Vanguard vs Merrill Lynch

Vanguard vs Merrill Lynch

Vanguard or Merrill Lynch - which is better in 2019? Compare IRA/Roth accounts, online investing fees, stock broker mutual fund rates, and differences.

Merrill Lynch vs Vanguard Introduction

Merrill Lynch and Vanguard are two very different brokerage firms. With distinctive commission schedules and range of offerings, they have unique strong and weak points. Let's take an in-depth look at these two firms and see if one can be considered the better broker.


Broker Fees Stock/ETF
Mutual Fund
Annual IRA
Merrill Edge $6.95 $19.99 $6.95 + $0.75 per contract $0 $0
Vanguard $7-$20 $8-$35 $20 + $1.00 per contract $20* see
Ally Invest $4.95 $9.95 $4.95 + $0.65 per contract $0 $0


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

Investing in Funds

More than 4,000 mutual funds are available to trade at Merrill Lynch. Less than 900 are no-load, no-transaction-fee products. Funds that do have a transaction fee cost $19.95. This charge is applied to purchases, sales, and exchanges. The broker also imposes a short-term trade fee of $39.95 if an NTF fund is held less than 3 months.

Vanguard has 16,000 mutual funds for its clients, more than four times what Merrill Edge offers. Some of these funds have no load and no transaction fee. Funds that do carry a transaction fee are $35 in a basic account (these are accounts that have $50,000 or less in Vanguard funds). Larger accounts are charged $20 or $8, depending on the account balance. Like Merrill Edge, the charge is applied to sales, purchases, and exchanges.

In addition to managing 127 mutual funds, Vanguard also offers 55 exchange-traded funds. Both types of funds can be traded with no fees or commissions in a Vanguard account. All of these funds have expense ratios below 1.0% with many below 0.20%. By contrast, Merrill Edge does not manage any mutual or exchange-traded funds, nor does it offer any ETF's commission free.

Vanguard takes this category easily.

Can You Buy Vanguard Funds At Merrill Lynch?

For investors wondering "Can I buy Vanguard funds on my Merrill Lynch account?", we wrote this article that explores Merrill Lynch's mutual funds offerings in detail.

Vanguard versus Merrill Lynch

Commissions and Account Minimums

Merrill Edge has no fees for its brokerage accounts, although paper statements do cost $5 per copy. Vanguard does have a $20 annual fee for accounts under $50,000, although the fee can be waived by signing up for electronic delivery of account documents. There is no minimum deposit requirement to open an account at either firm.

Merrill Edge customers pay $6.95 for stock and ETF trades. Vanguard has a variable commission that is determined by account size. Equity trades are always between $0 and $20 for all customers. In a standard account, the first 25 trades in a year are $7. All trades thereafter are $20.

Derivative traders at Merrill Edge pay an extra $0.75 for each option contract purchased. Vanguard charges $1 per contract on top of a base charge, which varies from $1 to $20. The base charge is determined by the balance of Vanguard funds the account has. A standard account with less than $50,000 in Vanguard assets pays the $20 base charge.

Both firms offer live representatives to help clients execute a trade over the phone. Merrill Edge has a $29.95 fee for this service. As usual, Vanguard's price varies based on account size. It ranges between $0 and $25.

Because of its simple pricing, Merrill Edge wins here.

Retirement Accounts

Merrill Edge customers can open several different types of retirement accounts. These include Roth, Traditional, SIMPLE, SEP, and Rollover IRA's. The broker also offers annuities and a 401(k) plan. There are no on-going account fees for the firm's IRA's, although there is a $49.95 fee for closeouts and transfers.

Vanguard offers Roth, Traditional, SEP, SIMPLE, Rollover, and Inherited IRA's. The broker also has 403(b)(7) plans, and 401(k) and Roth 401(k) accounts. The Traditional and Roth IRA's have a $20 annual fee and another $20 fee for each Vanguard fund with a balance under $10,000. However, these charges can be eliminated by signing up for electronic delivery of statements.

Since most Merrill customers will choose e-delivery of statements, it's a tie here.

Merrill Lynch vs Vanguard

Trading Tools

The Merrill Edge website is intuitive and easy to use. Different topics are simple to find using drop-down menus. Trades can be placed within the web browser and with the broker's useful trade ticket, called TradeBar, which appears at the bottom of the browser. This tool can display a small chart and allows for quick order entry. The broker also has an advanced trading platform for frequent traders.

The Vanguard website is more difficult to navigate than the Merrill Edge site. Using the website's search field does help with navigation, however. The broker does not have an advanced platform or even a trade bar, so trading occurs with simple trade pages.

Merrill Edge takes this category.

Mobile Platforms

Traders at Merrill Edge can buy and sell securities using Android and Apple phones and tablets. An app for Apple Watch is also available. The platform has bill pay, funds transfer, and mobile check deposit. Business news articles are on the app, but it lacks streaming financial news.

Vanguard customers can use Kindle Fire, iPad, iPhone, and Android. Unfortunately, there is no platform for Apple Watch. The Vanguard app has a customer service contact, order entry, and mobile check deposit. Like Merrill Edge, the Vanguard app lacks streaming business news.

It's a dead heat here.

Banking Features

Checks and a Visa debit card are available with a Merrill Edge securities account. The card and checks are free of charge. Bank of America ATM's provide free withdrawals. Customers receive up to $200 in credit for non-Bank of America ATM's annually. Traders can also link a Bank of America checking account to a Merrill Edge account.

Vanguard has a hybrid investing-cash management account for its clients. However, there is a very steep $500,000 account minimum to apply. Checks and the debit card also come with fees.

Merrill Edge wins this category.


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

Vanguard: none right now.

Merrill Lynch vs Vanguard Results

Merrill Lynch (review) was victorious in three categories, Vanguard (review) took one category, and there were two ties. Merrill Lynch wins over Vanguard. Nonetheless, Vanguard is a good choice for investors who want to trade mutual and exchange-traded funds. Active investors and traders should take a look at Online Broker Reviews.