Ally Invest versus Charles Schwab

Ally Invest vs Charles Schwab

Charles Schwab or Ally Invest - which is better in 2018? Compare IRA/Roth accounts, online investing fees, stock broker mutual fund rates, and differences.


Charles Schwab and Ally Invest are two low-cost brokers that provide many similar services, and so they tend to attract the same types of clients. While Schwab advertises more heavily, Ally Invest offers breaks to active traders. Let’s try to find out which company is the better value - Charles Schwab or Ally Invest?

Broker Fees Stock/ETF
Mutual Fund
Annual IRA
Ally Invest $4.95 $9.95 $4.95 + $0.65 per contract $0 $0
Charles Schwab $4.95 $76 ($0 to sell) $4.95 + $0.65 per contract $0 $0

Broker Review Cost Investment Products Trading Tools Customer Service Research Overall Rating
Ally Invest
Charles Schwab

Fees and Commissions

Ally Invest customers pay $4.95 for stock and ETF transactions. Active traders pay only $3.95. To qualify, the broker requires a very steep $100,000 account balance or 10 commissionable trades per month. Option contracts cost 65 cents, and clients who meet the above requirements pay 50 cents.

Equity trades at Schwab are also $4.95. However, the broker-dealer does not provide any discounts. Derivatives cost an additional 65 cents per contract.

An account at either brokerage firm has no on-going maintenance fee. There are no surcharges for minimum balances or inactivity. Ally Invest has no minimum deposit requirement to open an account, while Schwab customers must deposit $1,000 to open an account. This requirement can be waived by opening a checking account with Schwab Bank.

Ally Invest wins the first category.

ETF’s and Mutual Funds

Schwab’s mutual fund screener generates more than 5,000 securities that are open to new investors. Over 3,000 of these funds are no-load, no-transaction-fee funds, which Schwab calls OneSource funds. The broker charges $76 for the purchase of a fund that isn’t on its NTF list. The charge is not applied to sales. An NTF fund that is sold in less than 3 months after purchase carries a $49.95 charge. Finally, the broker offers a list of more than 200 exchange-traded funds that are free to trade.

A larger list of mutual funds will be found using Ally Invest’s screener. There are roughly 8,000 securities available for purchase, with 1,700 having no load. The broker doesn’t offer any funds that carry neither load nor transaction fee. Ally charges $9.95 for no-load funds, and the fee is assessed on both the buy side and sell side. Load funds are always free to trade, and there is no short-term redemption fee at Ally. Unfortunately, the broker does not provide any ETF’s that are commission-free.

Because all popular mutual funds cost just $9.95 at Ally Invest versus $76 at Schwab, Ally wins this category.

Ally Invest vs Schwab

Customer Service

An Ally Invest representative can be reached any time of the day or night. Besides phone service, the broker also provides a chat function on its website. Customers who travel outside the US also can use an international phone number. The broker does not have any physical offices.

Schwab also provides 24/7 support over the phone and through its convenient on-line chat feature. The broker has customer service agents certain times of the day who speak foreign languages, and there are international phone numbers available. Unlike Ally, Schwab has a nationwide network of branch locations; the broker even has offices in Puerto Rico and the UK.

This category is a tie.

Promotion Links

Ally Invest: Get a $200 cash bonus or $500 in commission-free trades.

Charles Schwab: Make $100,000 deposit and get 500 commission-free online equity and options trades.

Trading Technology

The Ally Invest website is contained within, although it has a different interface than the banking side of the company. The bank’s interface is actually more user-friendly, although there’s nothing specifically wrong with the brokerage software.

Investors who want to use a trading platform have access to Ally Invest LIVE, a browser-based program that is fairly simple. Charting comes with technical studies, comparisons, and multiple graph styles. There is no desktop platform here. The broker does provide a trade bar, and orders can be placed on it. Of course, the web site also has order tickets for all securities.

Like Ally, the Schwab website has a trade bar that sits at the bottom of the browsing window. But trades cannot be placed on it. It does display bid and ask prices, along with trade volume. A handy chart pops up after clicking on ‘Chart.’ Clicking on ‘Trade’ takes you to a web page where an order can be submitted.

Where Schwab really excels is in its advanced desktop trading system named StreetSmart Edge. This platform is free for all clients, and it comes with some very handy features, such as color customization, in-depth Nasdaq data, and sophisticated charting tools.

StreetSmart Edge gives Schwab the victory here.

Mobile Trading

There is one Ally mobile app, and it can be used for both banking and investment purposes. The brokerage side has watchlists, positions, market news, and option chains. Charts are also available, and the software has some technical indicators. There is no video news, unfortunately, nor does the broker provide a platform for Apple Watch.

Schwab does have an app for Apple Watch. It also has a platform for Kindle Fire, which Ally lacks. Ally, however, has an app for Windows, which Schwab lacks. There are useful features on the Schwab app, such as bill pay and live streaming of CNBC free of charge.

The two brokers are tied here.

Research & Educational Resources

Traders at Schwab will find a website with loads of resources. There are free equity reports available that come from several analysts. The broker provides a lot of educational materials on a variety of financial topics, such as estate planning and tax implications of investing. These resources come in both video and article formats.

The Ally Invest site has fewer resources. There are short articles on different types of investments, including bonds and options. There are fewer videos at Ally Invest, and the broker only offers stock reports from CFRA.

Schwab is a much better choice here.

Ally Invest vs Charles Schwab - Outcome

Ally Invest (read brokerage review) succeeded twice, there was one tie, and Schwab (read brokerage review) won three categories. Schwab wins by a small margin, while Ally takes the most important category - Fees and Commissions.