Fidelity vs USAA


Fidelity Investments against USAA - which is better in 2018? Compare IRA/Roth accounts, online investing fees, stock broker mutual fund rates, and differences.



Fidelity Versus USAA


If you’re planning to open a new brokerage account in the near future, you may want to take a look at Fidelity and USAA. Both brokers deliver a lot of investment services, while managing to keep prices down. This survey will compare and contrast the two firms and try to determine if one can be recommended over the other.


Fees, Commissions, and Account Minimums


Broker Fees Stock/ETF
Commission
Mutual Fund
Commission
Options
Commission
Maintenance
Fee
Annual IRA
Fee
Fidelity $4.95 $49.95 $4.95 + $0.65 per contract $0 $0
USAA $8.95 $45 $8.95 + $0.75 per contract $0 $0


When you buy or sell a stock or ETF at Fidelity, the broker charges $4.95 for each transaction. If you want to trade options, Fidelity adds 65¢ to this base charge for each contract. Ten contracts in a multi-leg strategy would be $11.45 ($4.95 + $6.50). Fidelity does not provide reduced commissions for large accounts or frequent traders.

An investment account at Fidelity does not have an annual fee or any other type of on-going fee. The broker requires a $2,500 deposit to open a taxable account.

USAA is more expensive than Fidelity for most trading activities. ETF and stock trades are $8.95. This rate goes down to $5.95 after you reach 25 trades in a quarter. This is still more than Fidelity clients pay, however. Derivatives at USAA cost 75¢ on top of the base charge; so once again, Fidelity is cheaper.

USAA focuses on soldiers and their families, but a securities account can be opened by anyone. There is a $3,000 minimum opening deposit requirement. There is also a $10 closeout fee if an account has no activity for twelve months and has less than $100 in it.


Customer Service Availability


Traders who need the best customer service will be very pleased with what Fidelity has to offer. The brokerage house has associates on the phone all hours of the day and night, including weekends. Fidelity’s website has a really nice on-line chat feature; it’s handy when you’re already on-line. And we shouldn’t fail to mention the company’s extensive network of branch locations throughout the United States.

USAA is less impressive here, providing service from morning till evening during the week plus more limited hours on Saturday. Because the broker caters to military families, it offers a long list of international phone numbers; although Fidelity has a similar collection. There is just a handful of USAA branch offices, which is dwarfed by Fidelity’s 190 locations.


Trading Software


Fidelity’s website offers a basic trading platform that can be used to buy and sell all the investments the broker offers, including not just stocks and funds, but also derivatives and fixed-income products. I especially liked the broker’s simple trade ticket. It pops up and sits in the left-hand side of the screen after you click on a buy or sell button.

If you need more powerful trading tools, Fidelity doesn’t disappoint. Active Trader Pro is its flagship desktop platform, and I found it very sophisticated. The software comes with advanced charting that incorporates many technical studies and a decent amount of customization.

Fidelity is one of the few brokerage firms to roll out a skill for Amazon Echo. Using Fidelity’s program, Alexa can return important market data, such as the day’s biggest movers. Fidelity also has an app for Apple TV.

Once again, USAA fails to live up to Fidelity. There is no desktop platform available, so there was nothing to test out there. USAA clients buy and sell on the broker’s website, which is fairly simple and doesn’t have the same level of sophistication as Fidelity’s website.

I thought USAA’s charting was fairly rudimentary, for example. I did like the amount of financial services available through the USAA site, though. These include flood insurance, annuities, boat insurance, mortgages, health insurance, and much more.


Fidelity Investments vs USAA



Buying and Selling on Mobile Apps


Fidelity’s mobile app is very nicely designed. One of the best parts is a live broadcast of Bloomberg News in HD. Even better, Fidelity charges nothing for it. The platform can be used to trade different security types, and stock ratings from Thomson Reuters are available.

I found USAA’s app to be far less advanced than Fidelity’s. There is no video news on USAA’s, for example. There are option chains and news articles. Argus provides equity reports, and options can be traded on the app. Like Fidelity, there is bill pay, check deposit, and funds transfer. Besides investing, the USAA app also incorporates a claims center for insurance.


USAA Brokerage   vs Fidelity


Promotions


Fidelity Investments: Get 500 free trades with $100,000+ deposit.

USAA: none right now.



Funds


I was impressed with both brokers’ fund selections. Fidelity customers have access to 10,908 mutual funds. Roughly 2,000 have no loads and no transaction fees. During our testing, we found the broker’s mutual fund screener to be helpful, but one flaw is the inability to search based on load status. Fidelity customers pay a slightly expensive $49.95 for transaction-fee funds.

Although USAA underperformed Fidelity in the other categories, it performed well here. We found over 14,000 funds in the broker’s fund marketplace; and nearly 2,000 of them were no-load, no-transaction-fee products. USAA charges a slightly lower $45 for transaction-fee funds. Like Fidelity, USAA manages its own lineup of funds, although Fidelity has more.

For ETF traders, Fidelity offers a large selection (93 at last count) that comes with zero commissions. These are from iShares and Fidelity. Some of these funds have very low expense ratios. The Fidelity health care fund charges just 0.084% annually, for example.

USAA traders also have some commission-free ETF’s, although the broker-dealer has just 24. They come from Fidelity and USAA.


Judgment


During our research, Fidelity (learn more) came across as the better broker in most categories. Fidelity would definitely be the better choice for active stock traders, due to its low commission schedule and desktop platform. But USAA (learn more) performed well in the mutual fund category, offering more products than Fidelity. Soldiers, including active duty, reserves, and retired, might find better service at USAA.



Updated on 3/29/2018.