Merrill Edge vs. Schwab
Highlights:
• Many investment services are available through Merrill Edge and Charles Schwab.
• In addition to brokerage accounts, both firms offer financial planning and advisory accounts.
• Only Schwab offers trading in futures and forex.
Are you thinking about opening a brokerage account? If so, Charles Schwab and Merrill Edge are both worth a closer look. These two financial giants offer brokerage accounts and many additional services.
Commissions
| Broker Fees |
Stock/ETF
Commission |
Mutual Fund
Commission |
Options
Commission |
Maintenance
Fee |
Annual IRA
Fee |
|
Charles Schwab
|
$0
|
$49.95 ($0 to sell)
|
$0.65 per contract
|
$0
|
$0
|
|
Merrill Edge
|
$0
|
$19.99
|
$0.65 per contract
|
$0
|
$0
|
Services
Promotions
Charles Schwab: $0 commissions + ACAT rebate + satisfaction guarantee at Charles Schwab.
Merrill Edge: Currently, no promotions.
Available Assets
Schwab offers self-directed trading in these investment products:
• Stocks
• Options
• Exchange-traded funds
• Closed-end funds
• Mutual funds
• Bonds
• Futures
• Forex
• Real estate investment trusts
• American depositary receipts
Schwab’s stock lineup includes both OTC securities and foreign equities.
Merrill Edge trims the lineup somewhat; futures, forex, and direct trading in foreign stocks are missing. Everything else on Schwab’s list is available, though.
Investment advice is another important category. Both firms offer managed accounts. Robo and full-service accounts are available, along with one-on-one financial advice that can be obtained online or through branch-based resources.
Both firms also provide a variety of account registrations. These include custodial accounts, 529 plans, trust accounts, and retirement accounts.
Winner: Schwab
Margin Services
Both firms offer margin trading in self-directed brokerage accounts. Short and long positions can be opened, and advanced option spreads are available as well. Schwab’s equity profiles show the maintenance margin requirement for long stocks.
If margin is never used, a margin account will not have any interest charges. Using margin, however, does come
at a cost. Schwab traders pay margin interest on a tiered schedule. It ranges from 11.825% to
10.075%.
Merrill Edge uses a somewhat more complicated schedule. Like Schwab’s system, it considers the loan
balance; it also factors in the customer’s total assets within the Bank of America
family of companies and adds 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 a trade button on a security’s profile opens the ticket. On SnapTicket, multiple classes of securities can be traded, including stocks, ETFs, options, and mutual funds.
A more complete 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 review, we found OCO and contingent orders.
For a 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 several strong tools, including Level II quotes and a price ladder.
Last, but definitely not least, is thinkorswim in desktop mode. This advanced program provides the highest level of trading at Schwab and includes some very powerful trading tools, including hundreds of technical studies and live streaming video news.
Merrill Edge does not offer video news on any platform. It also does not have a desktop program, although it does have a browser-based system called MarketPro. This useful program has many helpful trading tools, including real-time market data, news, interactive charting, and multi-leg options trading. The website has fewer tools but is still effective for basic trading and manages to include some sophisticated derivative tools.
Winner: Schwab
Mobile Trading
Schwab clients can use two apps. There is a main app and a thinkorswim app. The latter platform is built for more advanced trading and is the only one of the two that can submit orders for futures and forex. More advanced charts are available on the thinkorswim app with 300+ technical charts and indicators. The main Schwab app has mobile check deposit, and Schwab’s mobile lineup offers a large amount of market news.
Merrill Edge has one main investing app. It provides many personal-finance tools through its connection with Bank of America. For example, we found a Life Plan® tool that is useful for setting goals. 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. Schwab offers pre-market and after-hours trading, plus 24/5 trading in all S&P 500, NASDAQ 100, and Dow 30 stocks, plus more than 600 ETFs, on thinkorswim. Futures and forex have their own extended trading schedules.
Initial Public Offerings: Schwab has IPO access.
Fractional Shares: Schwab Stock Slices allow whole-dollar purchases for stocks and ETFs trading on the U.S. exchanges with a $1 minimum per stock. Merrill Edge does not offer regular self-directed fractional-share trading.
Systematic Mutual Fund Purchases: Both brokerage firms offer automatic purchases of mutual-fund
shares; Schwab also offers the service on the sell side.
Winner: Schwab
Recommendations
Retirement Planning & Long-Term Investing: Both companies have many articles and calculators on their sites devoted to retirement. Financial planners are available online and through branch-based resources. Neither one would be a poor choice.
Small Investors: Schwab requires $5,000 for its automated service, while Merrill Guided Investing requires $1,000 for growth-focused strategies. Neither works well for very small managed accounts. For self-directed trading, neither firm has a minimum.
Active Equity Trading: We prefer Schwab with the thinkorswim platforms.
Beginners: We suggest an investment-advisory account, preferably with a human advisor, at either investment firm in this comparison.
Mutual Funds: At Schwab, we found a much better mutual fund selection.
Promotions
Charles Schwab: $0 commissions + ACAT rebate + satisfaction guarantee at Charles Schwab.
Merrill Edge: Currently, no promotions.
Merrill Edge vs Schwab: Summary
Schwab is the clear winner in this comparison, although Bank of America customers may prefer Merrill for convenient account linking.
|
|
Updated on 5/29/2026.
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.
|