Fidelity Review 2015: Commissions, Fees, and Minimum Deposit
|Stocks and ETFs|| $7.95|
|Stocks and ETFs broker assisted|| $32.95|
|Stocks and ETFs FAST (automated service phone)|| $12.95|
|Options|| $7.95 + $0.75 per contract|
|Mutual funds||$49.95 ($75 for some funds; Fidelity funds are commission free) to buy, $0 to sell ($49.95 if sold within 60 days)|
|Bonds (U.S. Treasury Auctions, including TIPS Auctions, U.S. Treasury Bills, Notes), primary market CDs|| on a net yield basis|
|GSE (Agency Securities), secondary CDs, Municipals, Corporates (BBB- or higher), CATS/TIGRS, Corporates (BB+ or lower)|| $1 per bond ($250 max.; $50 max if maturing in one year)|
|Commercial Paper|| $50 per transaction|
|Investments|| stocks, bonds, mutual funds, options, commercial paper, forex, foreign stocks, UITs, precious metals, ETFs|
|Fidelity minimum deposit to open account|| $2,500 ($0 for Rollover IRA; $2,500 or $200 per month. for ROTH and Traditional IRA)|
Fidelity's account opening process is very well designed and quick - it took only ten minutes to open a regular brokerage (non-IRA) account. The application
includes designating a beneficiary, setting up document delivery options (we always choose email) and ACH information to transfer money from/to a bank.
After the account is opened, transferring money from your bank is a simple matter of going to Accounts & Trade -> Transfer Money/Shares in the main menu of
the homepage. The main downside is that the ACH deposits you make with Fidelity will generally not be available for trading (or withdrawal) for up to 4-6 business days, which is much longer
than with many other brokers.
Fidelity Mutual Funds Review
Fidelity Investments is one of the largest mutual fund companies in the world, with 430 mutual funds under management, that target dozens of asset classes:
index funds, U.S. stocks and international stocks funds, asset allocation funds, sector funds and others. In total, the firm offers over 10,000
mutual funds for clients to invest in.
Fidelity's own mutual funds and funds in NTF program are commission free. All other mutual funds can be
purchased for $49.95 or $75. Selling mutual funds is free unless client sells within 60 days of purchasing - then Short Term Trading Fee of $49.95 applies
(does not apply to Fidelity family funds). There is a Low Balance Fee of $12 per year for each noncore Fidelity fund with balance under $2,000.
Fidelity.com Website/Trading Platform/Tools Review
Fidelity.com website is now much better designed, less cluttered, and more intuitive than it used to be. But some parts of it are still using old design
and parts of it are missing navigation menu. Fidelity can't even list all the fees on the website - instead provides
a 6-page PDF document
with all the charges.
The firm has many of the standard tools that other online brokers offer such as stock screeners and portfolio builders.
One of the best things about online trading with Fidelity is the ability to actually trade stocks in 25 countries via various stock exchanges
and 16 currencies around the globe with the flexibility to settle in either U.S. dollars or the local currency.
Fidelity research tools (such as stock screening, historical trading strategies,
daily market commentary, and individual stock research) are impressive. There are research reports from 12
different independent firms covering over 4,500 companies, as well as 36 tax, savings, and retirement calculators.
The company also offers two advanced trading platforms: first is Active Trader Pro that requires at least 36 trades in a rolling 12-month period,
and the second is Wealth-Lab Pro that requires at least 120 trades during the same period. Both platforms are excellent but most competitors
provide their advanced platforms with no conditions to all customers.
Fidelity offers applications for iPhone, iPad, Android, and Windows Phone. The interface is intuitive and user friendly. Users can transfer funds
between Fidelity and non-Fidelity accounts, make a mobile check deposit, place trades, pay bills, and contact customer service.
Fidelity Investments Review: Company Pros
- No surcharges on penny stocks, large orders, or after-hours trading
- Great investment research tools with large selection of independent research from 12 firms
- Huge selection of commission-free mutual funds
- Free DRIPs (dividend reinvestment plans)
- No account maintenance or inactivity fees
- Great customer service
- Rich selection of investment products
- Good banking services (checking, savings accounts, and credit cards)
- 84 commission-free ETFs
Fidelity Investments Review: Company Cons
- Very high commissions - $49.95 ($75 for some funds) - to purchase non-Fidelity mutual funds
- $12 annual Low Balance Fee for each noncore Fidelity mutual fund if balance is under $2,000
- High margin rates
- Foreign currency wires cost up to 3% of principal
- Advanced trading platform, Active Trader Pro, is available only to clients making 36+ trades per year
- High $2,500 minimum to open an account
Fidelity Review Summary
Fidelity Investments is one of the largest brokerage companies in the U.S., and as such, provides a wide array of services to their investors. Fidelity offers
advice in wealth management, investment guidance, charitable giving, and provides lots of educational content for novice and professional
investors alike. The firm is offering over 10,000 mutual funds, life insurance, college savings plans and more.
The Fidelity's commission for stocks and ETFs is $7.95 per trade, which is just slightly above the average in the industry. Options trading costs $7.95 plus
$0.75 per contract. The company does not charge account maintenance (except $25 year for SIMPLE IRA) or inactivity fees, and does not add surcharges on penny stocks, large orders or
extended hours trading. But the minimum initial deposit for most accounts is somewhat high $2,500.
Fidelity's mutual fund commission varies from $0 for Fidelity and NTF mutual funds to $75 per transaction for some non-Fidelity funds. Keep in mind
that there is a $50 short-term redemption fee for mutual funds sold less than 60 days after being purchased. There is also a $12 annual Low Balance
Fee for any non-core Fidelity fund with balance under $2,000.
Fidelity's website needs more work, but their independent investment research selection from third parties is among the best in the industry.
The firm created powerful, advanced trading platforms but they are only available to clients making at least 36 trades per year. In contrast,
the best trading platform on the market, TD Ameritrade's ThinkorSwim, is available to
all TD Ameritrade clients.
We recommend opening an account with Fidelity to someone who wants to invest in Fidelity ETFs and mutual funds for the long run, provided there is
enough money to avoid the Low Balance Fee.
Reviewed by Brokerage Review on
Reviewed by Editor and 40+ Fidelity customers.