Merrill Edge vs. Ally Invest Introduction
Merrill Edge and Ally Invest are both backed by large U.S. banks. But that doesn’t mean they’re equal. Check out this review before choosing one of them.
Cost
| Broker Fees |
Stock/ETF
Commission |
Mutual Fund
Commission |
Options
Commission |
Maintenance
Fee |
Annual IRA
Fee |
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Ally Invest
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$0
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$9.95
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$0.50 per contract
|
$0
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$0
|
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Merrill Edge
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$0
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$19.99
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$0.65 per contract
|
$0
|
$0
|
Services
| Broker Review |
Cost |
Investment Products |
Trading Tools |
Customer Service |
Research |
Overall Rating |
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Ally Invest
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Merrill Edge
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Promotions
Ally Invest:
Up to $3,000 cash bonus + $0 commission trades.
Merrill Edge: Get up to $600 when you open a new Merrill Edge account with at least $20,000.
Investment Strategies
Merrill Edge customers can sign up for either self-directed or managed investing. In the former service, there is an ETF package with an online human advisor and one without. The prices are 0.85% and 0.45%, respectively. Neither program is a robo service.
Merrill also has traditional packages that deliver one-on-one in-person financial advisory services with fee schedules that are determined at the point of sale.
Merrill Edge’s self-directed accounts have no fees and come with a larger selection of tradable assets. These include stocks, option contracts, fixed-income securities, mutual funds, ETFs, and closed-end funds.
Ally Invest offers the same lineup of investment vehicles for its self-directed accounts. On the managed account side, Ally Invest has something that Merrill Edge doesn’t: a robo service. It costs 30 basis points annually if there is no cash position (free with a cash position). But Ally Invest doesn’t have something that Merrill Edge does: multiple human advisor options.
Winner: Ally Invest
Websites
For charting, order entry, and account management, both firms in this matchup have useful websites. On the Merrill Edge site, we found asset profiles with lots of information on them, including stock reports with price targets. The broker’s trade ticket has 8 order types, 4 of which are trailing orders. Charts on the Merrill site have up to 15 years of price data, technical indicators, company events, and comparisons. A chart cannot be displayed the full width of the monitor, however.
On the Ally Invest site, charting looks much the same with lots of tools but no full-screen mode. This situation is rectified with a browser platform (something that Merrill Edge doesn’t have) where a chart can be expanded horizontally.
Ally Invest’s trade ticket, whether on the website or browser platform, has 5 order types, one of which is market on close, an order type that won’t be found at Merrill.
Winner: Pretty even overall
Mobile Apps
Traders who can’t always be at their laptops and desktops will find much to like about the two firms’ mobile apps. On the Ally Invest platform, there is a watchlist that syncs with the watchlist on the website. Horizontal charting is available with several tools, and we really like the inclusion of option chains (available only for calls and puts).
The Merrill Edge app also has chains for puts and calls only. Unlike the Ally Invest app, the Merrill app can trade mutual funds, a major advantage. Horizontal and vertical charting are both available with several tools, including technical indicators and four graph styles.
Because both apps are operated by major banks, there are several cash management and personal finance tools on both.
Winner: Merrill Edge
Desktop Platforms
Both brokerage houses in this competition continue their rivalry with desktop software. Ally Invest offers Quotestream but requires 10 trades per month to gain access to it. Merrill Edge, on the other hand, delivers MarketPro with no frequent trader requirements at all.
Despite the difference in policy, our research confirms that MarketPro is actually the better platform. It delivers more tools than Quotestream (review) in a more user-friendly package.
Winner: Merrill Edge
Research and Education
On the Merrill Edge site, we found lots of educational materials. These are in article, video, webinar, tutorial, and self-guided course formats. They can be sorted by three experience levels (beginner, intermediate, and advanced). Besides information on specific asset classes like options and stocks, Merrill also provides educational resources on retirement and college planning.
Over at Ally Invest, we found articles and on-demand videos covering a variety of investment topics. Here are a few examples:
- VIX Spikes as Market Tumbles
- Mutual Funds: What They Are, How They Work and How to Invest in Them
- Put Options Explained: Buying or Selling Puts (With Examples)
Winner: Merrill Edge
Margin
Margin trading can be added to either a Merrill Edge or Ally Invest account. Merrill charges between 8.864% and 9.989% for debits. Ally Invest is between 4.75% and 9.25% .
Neither broker’s software displays margin details on a ticker symbol, one of the major downsides here.
Winner: Ally Invest
Other Services
Individual Retirement Accounts: Both broker-dealers in this contest have IRAs. Merrill Edge has more account types than its rival.
Access to IPOs: Neither firm provides pre-market IPO trading.
Fractional Shares: Same story here.
Cash Management Tools: Ally Invest customers can link Ally Bank accounts to their securities accounts. Merrill Edge customers can do the same (with Bank of America accounts). Plus, Merrill Edge clients can also add checkwriting and a Visa debit card directly to a brokerage account, something that Ally Invest customers can’t do without fees and minimums.
DRIP Availability: Dividend reinvesting is possible at both firms with zero fees.
Extended Hours: Merrill Edge offers extended-hours trading from 7:30 am until 9:30 am, and from 4:01 pm to 8:00 pm. Ally Invest’s hours are a little shorter: 8:00 am till 9:30 am and 4:00 pm to 5:00 pm.
Winner: Toss up
Recommendations
Retirement Savers and Long-Term Investors: Mutual funds are $10 at Ally versus $20 at Merrill Edge. We recommend Ally.
Small Accounts: For robo investing, Merrill Edge has a $1,000 minimum. Ally Invest has a $100 minimum. Self-directed traders have no minimum.
Beginners: Either broker’s robo program will work.
ETF & Stock Trading: MarketPro is the place to be.
Promotions
Ally Invest:
Up to $3,000 cash bonus + $0 commission trades.
Merrill Edge: Get up to $600 when you open a new Merrill Edge account with at least $20,000.
Merrill Edge vs Ally Invest: Results
Ally Invest has lower margin rates, and it narrowly beats Merrill Edge in this broker comparison.
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Chad Morris is a financial writer with more than 20 years experience
as both an English teacher and an avid trader. When he isn’t writing
expert content for Brokerage-Review.com, Chad can usually be found
managing his portfolio or building a new home computer.
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