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Merrill Edge vs Charles Schwab (2025)
Compare Charles Schwab versus Merrill Lynch (Bank of America Merrill Edge): which is better for
IRA/Roth accounts, brokerage fees, online stock trading, and mutual funds investing?
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Merrill Edge vs. Schwab
Highlights:
• Many investment services can be obtained through Merrill Edge and Charles Schwab.
• Besides brokerage accounts, both firms offer financial planning and advisory accounts.
• Only Schwab offers trading in futures and forex.
Are you interested in opening a brokerage account? If so, you should have a look at Charles Schwab and Merrill Edge. These two financial powerhouses offer brokerage accounts and a lot more.
Commissions
| Broker Fees |
Stock/ETF
Commission |
Mutual Fund
Commission |
Options
Commission |
Maintenance
Fee |
Annual IRA
Fee |
|
Charles Schwab
|
$0
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$49.95 ($0 to sell)
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$0.65 per contract
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$0
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$0
|
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Merrill Edge
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$0
|
$19.99
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$0.65 per contract
|
$0
|
$0
|
Services
Promotions
Charles Schwab: $0 commissions + satisfaction guarantee at Charles Schwab.
Merrill Edge: Get $0 stock commissions at Merrill Edge.
Available Assets
Schwab offers self-directed trading in the following investment products:
• Stocks
• Options
• Exchange Traded Funds
• Closed End Funds
• Mutual Funds
• Bonds
• Futures
• Forex
• Real Estate Investment Trusts
• American Depository Receipts
Schwab’s stock category includes both OTC securities and foreign equities.
Merrill Edge trims the list somewhat; missing are futures, forex, and foreign stocks. Everything else on Schwab’s list is available, though.
Then there is investment advice. Both firms offer managed accounts. Robo and full-service accounts are available along with one-on-one financial advice, which can be obtained at a local branch office.
Both firms also have a variety of account registrations. We’re talking custodial accounts, 529 plans, trust accounts, and 401k plans.
Winner: Schwab
Margin Services
Both firms offer margin trading in advisory and brokerage accounts. Short and long positions can be established, and advanced option spreads are on the table, too. Schwab’s equity profiles (but not Merrill’s) show the maintenance margin requirement for long stocks.
If margin is never used, a margin account will not see any fees. Using margin, however, does come
at a cost. Traders at Schwab pay margin interest on a tiered schedule. It is from 12.575% to
10.825%.
Merrill Edge has a somewhat more complicated schedule. Like Schwab’s system, it looks at the loan
balance; it also takes into consideration the customer’s total assets within the Bank of America
family of companies and adds in a variable lending rate, which adjusts once a week.
Winner: Schwab
Computer Tech
On Schwab’s website, we found an easy-to-use order form called SnapTicket. It stays hidden on the right-hand side of the site; clicking on a trade button on a security’s profile expands the ticket. On SnapTicket, there are three classes of securities that can be traded: options, stocks/ETFs, and mutual funds.
A more thorough trade ticket is available on its own web page; Schwab calls it the All-In-One Trade Ticket. Here, there are more advanced trade choices. During our probing, we found OCO and contingent orders.
For an even higher level of trading, Schwab offers thinkorswim. Found under the Trade tab on the website, this browser platform offers live and simulated trading. There are some really good tools, including Level II quotes and a price ladder.
Last, but definitely not least, is thinkorswim in desktop mode. This advanced program delivers the highest possible level of trading at Schwab and boasts some really advanced trading tools, including hundreds of technical studies and live streaming of video news.
Merrill Edge does not offer video news on any platform. It doesn’t have a desktop program, although it does have a web-browser system called MarketPro. This really useful program has a lot of helpful trading tools, including an advanced options platform. The website has fewer tools but is still effective for basic trading and manages to throw in some sophisticated derivative tools.
Winner: Schwab
Mobile Trading
Schwab clients get to use two apps. There is a main app and a thinkorswim app. The latter platform is designed for heavy-duty trading and is the only one of the two that can submit orders for futures and forex. Really advanced charts will be found on the thinkorswim app with more than 400 technical studies. Both apps have mobile check deposit and a great deal of market news.
Merrill Edge has just one app. It delivers a lot of personal-finance tools, thanks to its partnership with Bank of America. For example, we found a Life Plan® device that is useful for goal setting. For actual trading, there are horizontal charts with many graphing tools, option chains, and a trade ticket with trailing and stop orders.
Winner: Schwab
Additional Services
IRAs: Both Schwab and Merrill offer retirement accounts. Merrill, but not Schwab, charges $49.95 to close an IRA.
Fully-Paid Securities Lending: Schwab customers can earn extra cash by loaning out their stock shares.
DRIP Service: Cash dividends can be reinvested as additional shares of the securities that paid them at either firm.
Extended Hours: Available at both firms. At Schwab, futures and forex can be traded day and night. Foreign stock exchanges create 24-hour trading, too.
Initial Public Offerings: Schwab has IPOs.
Fractional Shares: Stock trades at Schwab can be made using whole dollars (for stocks outside the S&P 500, traders need to use Schwab’s Investment Themes).
Systematic Mutual Fund Purchases: Both brokerage firms offer autopilot purchases of mutual-fund shares; Schwab also offers the service on the exit side.
Winner: Schwab
Recommendations
Retirement Planning & Long-Term Investing: Both companies have lots of articles and calculators on their sites devoted to retirement. Financial planners are available online and at branch locations. Neither one would be a bad choice.
Small Investors: Schwab requires $5,000 for its automated service, while Merrill requires $1,000. Neither works for small accounts. For self-directed trading, neither firm has a minimum.
Active Equity Trading: We defend Schwab with the thinkorswim platforms.
Beginners: We suggest an investment-advisory account (preferably with a human advisor) at either investment firm in this competition.
Mutual Funds: At Schwab, we found 5,817 funds. At Merrill Edge, we found 2,558. We would go with Schwab.
Promotions
Charles Schwab: $0 commissions + satisfaction guarantee at Charles Schwab.
Merrill Edge: Get $0 stock commissions at Merrill Edge.
Merrill Edge vs Schwab: Summary
Schwab is the clear outperformer in this comparison, although Bank of America customers may prefer Merrill for convenient account linking.
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Updated on 1/26/2025.
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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