Schwab vs. SoFi Invest Introduction
Charles Schwab has been in the brokerage business for several decades. It is being challenged by the much newer SoFi Invest. Could the upstart have the better investing experience? We’re fixing to find out.
Sofi vs 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 vs Schwab Services
Promotions
Charles Schwab: Get commission-free online stock trades.
Sofi Invest:
0% SoFi management fees. Plus, unlimited access to financial planners.
Tradable Assets
Schwab customers can trade these investment vehicles:
- Stocks
- Futures
- ETF’s
- Closed-end funds
- Mutual funds
- Fixed-income instruments
- Option contracts
SoFi Invest adds cryptocurrencies to the mix but subtracts futures contracts, bonds, mutual funds, and options. Both broker-dealers provide trading in OTC stocks. Only Schwab offers trading in a selection of foreign stocks.
Winner: Schwab
Margin
Many of the asset classes mentioned above can be purchased using leverage. It’s easy to open a margin account on either broker’s website. Both websites display margin requirements for an entered ticker symbol.
Currently, Schwab charges 9.825% to 8.075% for margin debits. SoFi Invest has eliminated the traditional tiered schedule and charges a flat 4.5% for loans.
Winner: SoFi Invest
Websites
So far, we have a tie, so we need to look at their websites. Schwab’s is really easy to navigate thanks to a well-designed top menu. During our probing, we found an order ticket with trailing and stop orders. There is a discrete button for sell short. There are several duration choices, such as fill or kill.
A chart on Schwab’s website can be expanded full-screen, which is a recent change. There are all sorts of tools, like comparisons, indicators, and company events.
Then there’s Schwab browser-based platform just in case the previous tools just aren’t enough. The platform has some really advanced features, like OTO (one triggers other) orders and futures trading.
The SoFi Invest website doesn’t have a browser platform. It also doesn’t have any advanced trade types. It uses market, limit, and recurring orders. The last choice doesn’t appear on Schwab’s software, so that is one strong point. But SoFi Invest doesn’t permit shorting.
Charts on the SoFi Invest site are on a very low level with zero tools of any kind. A graph cannot be displayed the full width of the screen, so charts are basically worthless.
Winner: Schwab
Desktop Software
Although Schwab has done very well so far with its software, it goes one step further with a very good desktop platform. StreetSmart Edge is free to use and delivers many advanced trading tools. During our test drive of the platform, we really liked these features:
- Full-screen charts with many technical studies, drawing tools, customizable colors, and several plot styles
- Level II quotes free of charge
- Stock screener with many predefined screens that can be updated every 15 seconds
- Live streaming of CNBC
- Free technical analysis from Recognia
- Profit-loss diagrams
SoFi tries to make investing as simple as possible. As such, it does not have an advanced desktop trading system.
Winner: Schwab
Mobile Apps
Although SoFi Invest fails in the desktop arena, it doesn’t fail here. It has a well-designed mobile app with lots of tools for budgeting and personal finance (it is the same app that other SoFi customers use). The brokerage side of things delivers the same trading tools the website has. These include very simple charting and a basic order ticket. One feature the app has that the website doesn’t is social networking.
Schwab’s app doesn’t have any type of social networking. But it does deliver excellent trading tools. These include an order ticket with multiple trade types and time-in-force choices. Option contracts and mutual funds have their own tickets. And to top everything off, Schwab’s app has an Artificial Intelligence, which SoFi’s app lacks.
Winner: Schwab
Stock Research
Equity profiles on SoFi’s website and mobile app have scant information on them. We found trade details like 52-week high and dividend yield. And there are news articles with thumbnails. The broker has no stock screener, although it does create collections of securities. Called Discovery, this section (available on the website and app) puts securities into groups, like International Stocks and Gold Miners.
Schwab delivers much more. It has stock reports in pdf format from multiple analysts. We also found short interest, data from financial statements, peer comparisons, historical earnings, technical analysis scores, ESG ratings, dividend history, and more. Schwab also has a very good stock screener, which makes finding stocks much easier.
Winner: Schwab
Other Services
Individual Retirement Accounts: IRA’s are available at both firms in this investigation. Schwab has more IRA types, including small business IRA’s.
Cash Management Features: Schwab Bank has checks, debit cards, and free cash withdrawals around the globe. SoFi has no checks and limits ATM withdrawals with its debit card to the Allpoint network.
Fractional Shares: Schwab offers fractional-share trading in the stocks that make up the S&P 500 Index. SoFi Invest goes much further by offering fractional-share trading in all stocks and ETF’s.
Periodic Mutual Fund Investing: Schwab has it.
Extended Hours: Schwab and SoFi Invest both offer after-hours and pre-market trading. Schwab has a longer pre-market period.
DRIP Service: Available at both investment firms.
Initial Public Offerings: Schwab and SoFi Invest both offer access to impending stock releases.
Winner: Schwab
Our Recommendations
ETF & Stock Trading: Schwab with its desktop program or browser platform.
Beginners: New investors will be well served with an automated account at either brokerage firm in this contest.
Small Accounts: Schwab has a $5,000 minimum deposit requirement for its robo account. SoFi Invest only requires $1 for its automated service. Neither broker-dealer has a minimum to open a self-directed account. Both firms have a $5 minimum for whole-dollar purchases of stocks.
Mutual Fund Trading: Schwab gets the endorsement.
Long-Term Investors and Retirement Savers: SoFi has large resources on auto loans, mortgages, budgeting, student loans, estate planning, and more. Schwab has self-employed 401k plans, annuities, and financial-planning services. Either broker would be a good pick.
Open Account
Sofi Invest:
0% SoFi management fees. Plus, unlimited access to financial planners.
Webull:
12 FREE stocks valued $34-$30,600 give-away at Webull.
Charles Schwab: Get commission-free online stock trades.
Schwab vs Sofi Results
No, SoFi Invest does not deliver a better investing experience compared to Schwab, at least not
overall. We do like its cryptocurrency-trading service, however. And its margin pricing is very good.
Anyone looking for the top-rated brokerage firm on the market
should go with TD Ameritrade
or read TD Ameritrade review.
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Updated on 8/9/2022.
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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