Overview
Fidelity Investments offers an array of trading and educational tools that many first-time investors will find beneficial. With the availability of investment
advice and 24/7 customer service, traders hoping to learn the ropes seem to have good resources here. So, is Fidelity a good broker for a beginner? This article
will provide the answer.
The Fidelity Account
Fidelity’s flagship brokerage account is aptly named the Fidelity Account. Here customers have access to a rich range of products
and services and can link to other Fidelity Investments accounts, such as IRAs and cash management accounts.
Pricing, Fees, and Account Minimums
The cost of the Fidelity Account is good for first-time traders. There is no minimum balance requirement, and it comes with zero monthly account fees. There is a $2,500 opening deposit requirement.
Fidelity’s charge for stocks and ETF’s trading is $0. To place a trade over the phone costs $5, and trading with a living broker is a somewhat pricey $29.95.
Fidelity Investments provides over 10,000 mutual funds, many of which come with no load and no transaction fee when held more than 2 months. Such a selection of mutual funds is ideal for customers new to the world of investing who aren’t quite ready yet for the more volatile environment of stocks and options.
Fidelity Comparison
Cash Management
Fidelity also offers Cash Management Account, that comes with checks,
deposit slips, images of cleared checks, and a Visa Gold debit card. This gives the account all the benefits of a regular checking account.
New investors could use this account to learn Fidelity’s web site and to trade money market mutual funds.
Customer Service
Fidelity can be contacted through online chat system, phone, fax, or email. The phone service is staffed 24 hours a day, 7 days a week, and the reps have a history of being trained and actually knowing what they’re talking about, which of course is a big plus for traders who are new to the game.
Promotions
Currently, Fidelity Investments does not offer any promotions.
As an alternative, Ally Invest
currently has a promotion offering up to $2,500 cash bonus for depositing money into an account.
Trading tools
Fidelity offers trading by automated phone system, on-line, and with a live broker. As with
most low-cost brokers, the cheapest option is trading on-line. The web site is simple and easy to learn. Customers who have multiple accounts will see all accounts upon a single log-in.
Trading securities is trouble-free with Fidelity’s intuitive trade ticket or standard web browser platform. New investors without trading experience will have no problem catching on quickly. There are videos on Fidelity’s web site that instruct beginners on the ABC’s of placing trades.
Mobile trading
Fidelity offers apps for iPhone, iPad, Android, and Windows Phone 8. The apps interface is intuitive and user friendly. Users can easily
transfer funds between accounts, make mobile check deposits, place trades, pay bills, and contact customer service. It’s great for traders just starting out.
Pros
Fidelity has actual brick-and-mortar branches, which could come in handy for a noobie. Local branches offer investment advice and retirement
planning. Some of Fidelity’s competitors, such as Firstrade and TradeStation, don’t have local branches.
Cons
Fidelity’s standard commission on stocks of $0 is the same as at rivals. But the broker does charge
commission on options and mutual funds, while
Firsttrade and Webull are both at $0.
Fidelity's margin rates are higher than at many competitors, such as
M1 Finance and Webull.
Access to Fidelity’s advanced trading platform, Fidelity Active Trader Pro, is only available to traders placing 36 or more trades in a 12 month period,
a real turn off to new investors who probably won’t start out trading so frequently.
A practice account would be great for new investors to who need to experience trading without risking actual money. Unfortunately, Fidelity doesn’t offer
such a platform. TD Ameritrade and Webull do offer such virtual platforms, and they have no monthly account fees.
Finally, there is no promotion offer for investors opening an account. M1 Finance, Webull, and Firstrade
all offer incentives for new customers.
M1 Finance Promotion
Open M1 Finance Account
Firstrade Promotion
Open Firstrade Account
So Is Fidelity Good for Beginners?
Fidelity offers unique advantages to first-time investors; although they may want to check out a different broker to gain access to a
virtual trading platform.
Webull Promotion
Open WeBull Account
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