Overview
Schwab is an older brokerage firm that your grandparents might be using. SoFi, on the other hand, is a modern broker with different ideas on investing. Does that mean SoFi is better? Take a look at this comparison:
Sofi Invest and Charles Schwab Cost
| Broker Fees |
Stock/ETF
Commission |
Mutual Fund
Commission |
Options
Commission |
Maintenance
Fee |
Annual IRA
Fee |
|
Charles Schwab
|
$0
|
$49.95
|
$0.65 per contract
|
$0
|
$0
|
|
Sofi Invest
|
$0
|
na
|
na
|
$0
|
$0
|
Sofi Invest and Charles Schwab Services
Promotions
Charles Schwab: Make $100,000 deposit and get 500 commission-free online equity and options trades.
Sofi Invest:
Buy and sell stocks at no cost. Plus, there are no account minimums.
Available Investment Vehicles
Traders at Schwab have access to equities (including OTC stocks), fixed-income instruments, mutual funds, closed-end funds, ETFs, option contracts, and futures. The last offering includes bitcoin futures.
SoFi offers a smaller list: stocks, ETFs, closed-end funds, and three cryptocurrencies. The last item includes spot Bitcoin, Ethereum, and Litecoin. SoFi does not offer trading in over-the-counter securities.
All things considered, it looks like Schwab is the outperformer here.
Education & Research
Schwab customers get a treasure trove of learning materials. Accessed through the “Research” tab in the top men of its website, there is a Learning Center. We found many resources here, including materials intended for beginners. One example is a tutorial on stocks.
On top of learning materials, Schwab has a lot of great research tools. Screeners are able to scan the securities markets for stocks, funds, and options. Equity profiles include lots of data points. And we really like free pdf reports with trade recommendations.
SoFi doesn’t offer third-party analyst reports, or even reports from itself. Stock profiles have scant information. The broker-dealer does offer “Investing 101,” an educational section on its website. Articles are intended for investors who know virtually nothing about trading; so they would be a good resource for noobies.
This category goes to Schwab.
Trading Technology
Schwab clients start with the broker’s very good website. It has a trade bar at the bottom. The tool delivers real-time data on any entered ticker symbol. A small chart can be expanded from it.
A step up from the trade bar is StreetSmart Central, a browser platform. It has very good charting with several nice tools. An all-in-one trade ticket makes order entry for almost any asset a straightforward process.
Traders who aren’t satisfied with Central can move up to StreetSmart Edge, the company’s desktop software. It offers a lot of great features Central doesn’t, such as live streaming of CNBC and Level II quotes.
SoFi is a totally different experience. The broker-dealer doesn’t have a trade bar, desktop program, or browser platform. The website is it, and there’s not too much to it.
Charting is on a very elementary level with no tools. SoFi doesn’t have a trade ticket because customers don’t actually submit orders themselves. Instead, they send order requests to SoFi, who then sends all client orders to the exchanges at one time.
SoFi loses another category
Investment Advice
Besides self-directed accounts, both brokerage firms in this contest also offer portfolio management. SoFi has a hybrid robo-human service. A computer program makes trading decisions, and old-school managers offer guidance to customers who want it. There is no charge for either side, and only $1 is required to start.
Schwab offers a strictly automated service that is free with a $5,000 minimum. A portion of the portfolio is kept in a Schwab Bank account. A hybrid system, similar to SoFi’s, is available with a $25,000 deposit. It costs $30 per month.
SoFi wins a category.
Other Services
Dividend Reinvestment Program: SoFi and Schwab offer dividend reinvesting for self-directed accounts.
IRA’s: Both brokerage firms in this survey offer Individual Retirement Accounts. Schwab customers can open Inherited and Custodial IRAs, which aren’t available at SoFi.
Automatic mutual fund investing: Schwab offers this service, but SoFi doesn’t.
Schwab takes another victory.
Recommendations
Beginners: On top of its great educational resources, Schwab also has better customer service than SoFi.
Mutual Fund Investors: Schwab is the only choice.
Retirement Savers: Schwab has target-date mutual funds, more IRA choices, and a self-employed 401(k) plan. Easy choice.
ETF and Stock Trading: With its great software, $0 commissions, and the ability to place trades at any time during the market day, Schwab is our pick.
Promotions
Sofi Invest:
Buy and sell stocks at no cost. Plus, there are no account minimums.
Charles Schwab: Make $100,000 deposit and get 500 commission-free online equity and options trades.
Results
Although your grandparents may be Schwab customers, that doesn’t necessarily mean you shouldn’t be. SoFi has
tried to offer something new and different, but has mostly fallen flat. The older horse in this race is
obviously the better performer.
|