Merrill Edge Review: Commissions, Fees, and Minimum Deposit
|Stocks and ETFs|| $6.95|
|Stocks and ETFs broker assisted|| $29.95|
|Stocks and ETFs automated phone trades|| $32.50|
|Options|| $6.95 + $0.75 per contract|
|Mutual funds|| $19.95|
|Merrill Edge self-directed mutual funds|| 0.75% gross proceeds, $50 minimum, $250 maximum|
|Bonds|| On a net yield basis|
Opening a Merrill Edge account is easy, involving the usual filling out of forms on line and then a quick "Yes or No" decision regarding approval of your account.
The problem comes in getting the first deposit into the account. Where most on-line brokers ask for the routing number and account number of a checking or
savings account for funding, Merrill Edge account holders are not afforded this convenience. Merrill Edge would rather have you fill out a paper form that authorizes
the future transfers of funds between listed bank accounts and the newly opened Merrill Edge account. This fact is not revealed to the account holder until the account
is fully opened, however. This new account funding process is not exactly state of the art and has the effect of causing a delay in the end goal: funding the account and
buying securities. Merrill Edge needs to move to a system of confirming an account by making two small deposits and then receiving a confirmation from the account holder.
Nearly every other financial institution these days uses this method to everyone’s satisfaction.
Once the funding paperwork has finally been forwarded to the offices of Merrill Edge, moving money into and out of the brokerage account is very easy.
If the account holder has a cash balance in the account, a Merrill Edge debit
card can be used to withdraw funds directly from the account wherever VISA cards are accepted worldwide. Check writing against a cash balance is also offered to Merrill Edge account holders. Securities can be sold to raise additional amounts of cash for withdrawal, but funding with an equity or mutual fund sale requires a number of days for the cash to “settle” before it becomes available for withdrawal.
MerrillEdge.com Website/Trading Platform/Tools Review
The MerrillEdge.com website is well designed and easy to use even for beginner investors. Trading screens get the job done for most users though
the firm is not offering a lot of advanced functionality (for example, advanced order types) that can be found with many other online brokers.
Merrill Edge offers an advanced, full-screen, highly customizable trading platform called Market Pro. Among others, Market Pro provides the
Technical Insight tool which helps clients locate patterns in individual investments based on bullish or bearish technical events. Also included
is the Strategy Builder tool which allows users to screen investments based on a whole host of metrics. Active day traders may employ the
Intraday Trader tool to receive alerts from technical signals that are triggered throughout the day.
For customers who want to monitor their investments on smartphones, there are apps available for most major hand-held devices: iPad, iPhone,
Android, and Blackberry. These apps are rated 3 stars at iTunes and 4 stars at Google Play. With the apps users get access to their portfolio, quotes,
news, alerts, watchlists, mobile trading, and real-time transfers.
Merrill Edge / Merrill Lynch Pros
- Free trades if the account meets certain conditions
- Good banking services including a free checking account
- No surcharges on penny stocks, large orders, or extended-hours trading
- No account maintenance or inactivity fees
- Good investment research tools from Morningstar, Bank of America Merrill Lynch, S&P Capital IQ, Thomson Reuters, and Recognia
- Free DRIP (dividend reinvestment; client must call customer support to set it up)
- No-fee IRA accounts
Merrill Edge / Merrill Lynch Cons
- Technical issues (unusable login cards, website going down, etc.)
- High margin rates
- Mutual funds subject to self-directed short-term redemption fee of $39.95 if held less than 90 days
Merrill Edge Review Summary
Merrill Edge is a discount brokerage firm created by Merrill Lynch, which is now owned by Bank of America. The company offers self directed
accounts, and charges average in the industry rate of $6.95 per trade for stocks and ETFs. Mutual funds are priced at $19.95 per transaction.
Unlike some other online brokers, Merrill Edge does not impose surcharges on large orders, penny stocks, or extended-hours trading. There are no
maintenance or inactivity charges for all accounts.
The one thing that makes Merrill Edge stand out from the competitors is an offering of 30 free stock or ETF trades per month for customers who
meet any one of the following criteria:
1. Total combined balances of $25,000+ in Bank of America deposit accounts: checking, savings, FDIC-insured CDs or FDIC-insured IRAs.
2. Maintain total combined balances of $25,000+ in CASH balances in Merrill Edge account(s).
Essentially it means that to get free trades client must keep $25,000 in cash uninvested or earning tiny interest. Also, we don't see how a
brokerage firm could make any money with these free trades. We believe this is the same marketing trick that Zecco brokerage used to grow customer
base. The firm dumped "free trades" offering once it had enough clients.
There are a lot of complaints from Merrill Edge's customers on the whole range of issues: trading tools bugs, defective login cards (SafePass cards),
website going down, and order executions.
In conclusion, Merrill Edge is a natural choice for Bank of America customers, especially if they have enough cash available to qualify for free
trades. But even without relationship with a banking giant Merrill Edge offers attractive value for long term and retirement investors. Active
investors and bargain seekers, however, have more appealing options.
Reviewed by Brokerage-Review.com on
Reviewed by Editor and Merrill Edge customers.