Ally Invest versus Merrill Edge

Ally Invest vs Merrill Edge


Compare Merrill Edge versus Ally Invest - which online broker is better in 2020? IRA/Roth accounts, online investing fees, stock broker mutual fund rates, and differences.



Overview


Investors who are looking for a low-cost broker should take a look at Merrill Edge and Ally Invest (also known as TradeKing). In addition to low fees and commissions, these two firms also offer a variety of other financial services. Let's take a detailed look at these two companies and see which one is better - Ally Invest or Merrill Edge.


Cost


Broker Fees Stock/ETF
Commission
Mutual Fund
Commission
Options
Commission
Maintenance
Fee
Annual IRA
Fee
Ally Invest $0 $9.95 $0.50 per contract $0 $0
Merrill Edge $0 $19.99 $0.65 per contract $0 $0


Services


Broker Review Cost Investment Products Trading Tools Customer Service Research Overall Rating
Ally Invest
Merrill Edge


Promotions


Ally Invest: Up to $3,500 cash bonus + $0 commission trades.

Merrill Edge: Get up to $600 when you open new Merrill Edge account with at least $20,000.



Customer Service


Merrill Edge customers can reach a representative over the phone day or night, including weekends. There is a chat service for traders who are trying to open an account on-line, but not for regular customers. The broker does offer a phone number for clients who travel internationally. The firm has investment advisors at select Bank of America locations, although there are no retail brokerage locations.

Ally Invest offers phone support 7am-10pm ET, 7 days a week. The Ally Invest website has on-line chat during customer service hours. The broker does not have a network of branch offices, nor does it have financial advisors at bank locations.

The first category is a tie.


Cash Management Options


Merrill Edge offers checks and a debit card at no cost for all brokerage clients. These features are simply attached to an existing securities account. The card and checks do not create a separate cash account. There are no fees for withdrawals from Bank of America ATM's when using the Merrill Edge debit card. Merrill also reimburses up to $200 in ATM fees for non-Bank of America withdrawals. A second possibility for cash management is to link a Bank of America deposit account to a Merrill Edge brokerage account.

The best way to manage cash at Ally Invest is to open a no-fee account with Ally Bank, and easily link it to brokerage account. The broker reimburses ATM charges up to $10 per month, and the savings account pays a very high interest rate.

This category is a draw.


Mutual Funds


The Merrill Edge website has slightly less than 5,000 mutual funds that are open to new investors. Roughly 800 come with no transaction fee and no load. If one of these 800 funds is sold in less than 90 days after purchase, the broker imposes a $39.95 charge. There is a $19.95 fee for transactions of the other 4,200 funds.

Ally Invest customers have access to over 12,000 mutual funds. It does not offer a list of no-load, no-transaction-fee funds. Instead, the broker charges $9.95 per transaction if a fund is no-load. If a fund has a load, there is no transaction fee.

Overall, it's a tie here too.


Merrill Edge vs Ally Invest


Technology


The Merrill Edge website is easy to navigate and well-designed. There is a user-friendly trade ticket at the bottom of the browsing window. It can show a small chart, and orders can be placed on it. Charting on the website is fairly basic. A graph cannot be expanded to fill the entire monitor. The broker provides a desktop platform for active traders. Merrill Edge customers can also keep track of financial markets on tablets, phones, and Apple Watch. The tablet and phone app is able to deposit checks and pay bills.

Ally Invest's site isn't as advanced as Merrill's, but is simple to navigate nevertheless. A trade bar appears at the bottom of the browser, but it's not as sophisticated as the Merrill Edge version. Ally Invest gives all of its clients Ally Invest LIVE free of charge. This is a web-based trading system that has charting, account management, option chains, and more. A graph on the broker's website and on Ally Invest LIVE cannot be shown full screen. A more advanced platform called Quotestream is available for active traders. Ally Invest has a good mobile app for tablets and phones. The broker does not offer a platform for Apple Watch.

Ally Invest fails in this category.


Commissions and Fees


Ally Invest customers receive the lowest commissions in the industry — $0 for stock and ETF transactions. Option contracts are 50¢ extra. Ally Invest customer service reps can help clients complete a trade over the phone. The service is $24.95.

ETF and stock transactions at Merrill Edge are $0. Derivative contracts are 65¢. And executing a trade over the phone with a human broker is $29.95. Bank of America customers who have at least $20,000 in cash deposits and Merrill Edge accounts combined receive $0 commission stock and ETF trades.

A trading account can be opened at either firm with no minimum deposit requirement. There are also no on-going fees with either broker. This includes low-balances fee, annual fees, and inactivity fees.

Ally Invest wins here.


Ally Invest versus Merrill Edge


Managed Accounts


Ally Invest offers managed account option for customers who don’t have the time, confidence, or ability to make trading decisions. Ally charges 0.0% for its Cash-Enhanced Managed Portfolio. The pricing, obviously, cannot get any better. There is a $100 minimum to start the service.

Merrill Edge offers a robo-advisory service called Guided Investing that costs 0.45% of account balance annually and carries a $5,000 minimum. The money is invested in the diversified mix of ETFs and mutual funds.

Ally Invest is, obviously, better here.


Alternative Investments


Besides the usual line of securities, Ally Invest also offers forex trading. The broker provides its forex customers with a desktop platform used solely for currency trading. There is no charge for this software. Merrill Edge does not offer trading in forex or futures.

Ally Invest wins here.



Promotions


Ally Invest: Up to $3,500 cash bonus + $0 commission trades.

Merrill Edge: Get up to $600 when you open new Merrill Edge account with at least $20,000.




Merrill Edge vs Ally Invest: Results


Merrill Edge won one category, Ally Invest triumphed in three categories (including the most important Commissions and Fees category), and there were three ties. Ally Invest is a winner.

Thanks to a significant difference in pricing for mutual funds, stocks, and ETFs, which means savings of thousands of dollars over the years, Ally Invest has an edge in this online broker comparison for a majority of investors. Merrill Edge is a good broker for Bank of America customers.