Charles Schwab Overview
Despite offering low commissions on stock and ETF trades, Schwab maintains a high standard in brokerage services, keeping pace with top industry competitors. Here’s a closer look at this leading broker:
Charles Schwab Pricing and Minimum Deposit
| Investments | Commissions |
|---|
| Stocks and ETFs | $0 |
| Options | $0.65 per contract |
| Mutual funds | $0/$49.95/$74.95 to buy, $0 to sell |
| Futures | $2.25 per contract |
| CDs, Corporate Bonds, Municipal Bonds, Government Agencies, Zero-Coupon Treasuries,
including STRIPS and Mortgage-Backed Securities | $1 per bond, $10 minimum, $250 maximum |
| Preferred Stocks and REITs | $0 |
| Commercial Paper and Foreign Bonds, Unit Investment Trusts | call for pricing |
| Investments |
stocks, bonds, mutual funds, futures, Treasury issues, options, CDs, insurance, ETFs,
forex, annuities, non-U.S. securities and ADRs, WEBs and Canadian foreign orders
|
| Charles Schwab minimum deposit to open account | $0 for cash account, $2,000 for margin account |
| Fees | Charles Schwab fees |
| Promotion link | Charles Schwab promotions |
Bulls Mention...
Excellent pricing. While not the cheapest in the market, Schwab’s commission schedule is affordable and competitive.
Free software. Schwab provides access to all its trading platforms at no extra cost.
Great banking features. Schwab’s banking services rival many traditional banks.
Foreign stocks are available. Schwab offers access to international exchanges, which is rare among brokers.
Bears Mention...
Some investment vehicles aren’t available.
Limited selection of mutual funds. However, many come with no loads or transaction fees.
Investment Vehicles
Schwab offers a wide range of investment options, including stocks, ETFs, mutual funds, closed-end funds, options, futures, currencies, and fixed-income securities. Fixed-income offerings include municipal bonds, zero-coupon Treasuries (STRIPS), foreign bonds, CDs, mortgage-backed securities, preferred stocks, and UITs. Futures include bitcoin futures on the Cboe (/XBT), though CME futures (/BTC) are not available.
However, Schwab doesn’t offer precious metals, cryptocurrencies, warrants, or contracts for difference.
Learning Resources
Schwab provides robust educational resources, including articles, videos, branch workshops, and a quarterly newsletter called *On Investing*, available to everyone.
Another learning resource at Schwab is its security profiles. These contain data such as earnings history, peer comparisons, major news, and stock reports from providers like Ned Davis, Market Edge, Argus, and Morningstar. Schwab also creates its own stock report cards.
The platform offers screeners with many criteria for searches, including payout ratios, Credit Suisse ratings, earnings surprises, and price-to-book ratios. Schwab provides pre-defined screens for quick searches.
Options traders will find plenty of educational content and tools on Schwab’s platform.
Customer Service Options
Schwab offers 24/7 phone and online chat support. While it doesn’t have a robo-chat service like some competitors, it does offer support in Chinese.
Schwab’s extensive branch network includes over 300 locations, with some international offices.
Self-service resources are available through the website’s “Service” tab, offering paperless settings, wire transfers, and tools for managing contacts.
Account Types
Schwab’s main account type is the Schwab One® brokerage account. It also offers 529 plans, UGMA/UTMA accounts, trusts, estates, and institutional accounts.
For retirement savers, Schwab provides multiple IRAs, including SEP, SIMPLE, Roth, traditional, rollover, and inherited IRAs. It also offers PCRA (Personal Choice Retirement Accounts®) and self-employed 401(k) plans.
All of these accounts are fee-free and have no minimum balance requirements (except for charitable accounts).
Free Charles Schwab Account
Visit Schwab Website
Website
Schwab’s website is easy to navigate with a top menu and a trade bar that shows real-time data. A mini chart is available above the bar, though trades must be placed on a separate web page.
Schwab also offers a browser-based platform launched from the website. Its All-In-One Trade Ticket supports orders for stocks, ETFs, futures, and options.
Charting tools provide various styles like renko, kagi, and point and figure. Options traders can access pre-installed multi-leg strategies.
Mobile Trading
Schwab offers two mobile apps: the regular Schwab app and thinkorswim Mobile. The latter is modeled after the thinkorswim platform and offers advanced tools, though some users may experience text alignment issues.
The regular Schwab app provides features like mobile check deposit, live CNBC streaming, bill pay, and funds transfer. It also includes extensive charting tools and can display stock price data dating back to 1980.
Desktop Software
Schwab’s flagship desktop platform is thinkorswim, known for its advanced features. Users can opt for direct-access routing and Level II quotes by adjusting settings in the top menu.
Highlights include Recognia’s technical analysis, streaming news, a block trade indicator, and a versatile All-In-One Trade Ticket.
Other Software
Schwab extends its software offering to Amazon Echo devices, allowing users to get market updates and investment quotes.
Schwab also has a smartwatch app that provides mini charts and price data. However, the broker doesn’t offer an Apple TV app.
ETF’s
Using Schwab’s platforms, traders can buy and sell ETFs with ease. The ETF center on Schwab’s website offers useful tools, including a comparison tool that displays potential investments side by side. A keyword search tool helps users find funds by specific terms. For example, typing in "silver" returns SLV (iShares Silver Trust) and other funds related to silver.
ETF profiles include details on holdings, distribution history, available options, and analyst reports. Schwab provides some of these reports, along with analyses from other sources.
Mutual Funds
Schwab clients can access the mutual fund hub under the "Research" tab. This hub provides a search tool to filter funds by Morningstar rating, minimum investment, transaction fees, and more.
Schwab also offers a Select List of mutual funds, which are pre-screened by licensed advisors for strong performance potential.
The fund screener offers various filters, including sector exposure, maturity, annual returns, and top holdings. When filtering only for funds open to new investors, the screener returned 5,704 results. Although this is a relatively small list, 3,353 of these funds come with no load or transaction fees.
Commission Schedule
Schwab charges $0 for online stock and ETF trades. Trades made through the automated phone system cost $5 (except REITs, which are $0). Trading with a live agent costs $25. Option trades have the same base rate, with an added 65¢ per contract per side. There are no discounts for frequent traders.
Futures cost $1.50 per contract per side, with no extra fee for phone-assisted trades. Mutual funds with transaction fees are priced at $49.95.
New bond issues include a markup, disclosed in writing. Most Treasury securities are commission-free, while corporate bonds cost $1 per bond.
Free Charles Schwab Account
Visit Schwab Website
Portfolio Management
Schwab offers several account management options. Its robo-advisor service is free but requires a large cash balance. Some of the ETFs used are Schwab funds, which may raise concerns, and there is a $5,000 minimum to open an account.
For traditional account management, Schwab Private Client™ starts at 0.80% annually for a $500,000 investment, with rates decreasing for higher balances. A dedicated team of advisors manages these accounts, allowing investments across multiple asset classes. You can compare this service to other financial advisors in your area.
Schwab also offers a hybrid service that combines automated management with human advice for $30 per month, plus a one-time $300 financial planning fee.
Banking Tools
Schwab’s banking services are outstanding. Its checking account includes free checkwriting and a debit card. Schwab reimburses all ATM fees worldwide without limits, making it the only broker we know to offer such a benefit. There are no fees or minimums, although the checking account must be linked to a brokerage account.
Global Stocks
Schwab provides access to 12 foreign exchanges through the Global Account™. Although there are no minimums or fees, commission rates can be high.
For example, trades on the Tokyo Stock Exchange cost ¥2,000. Additional international exchanges are available through regular brokerage accounts, but these trades must be made over the phone, increasing the cost.
Other Services
Schwab supports both dividend reinvestment and automatic mutual fund purchases at no extra charge.
Awards
Charles Schwab Review Summary
With 4 stars and above in every single category analyzed, Schwab is a consistent outperformer. With a
low commission schedule, it also is a very good value.
Free Charles Schwab Account
Visit Schwab Website
Charles Schwab Questions and Answers
What investments can clients make through Charles Schwab?
Charles Schwab customers can trade the following asset types: stocks, bonds, mutual funds, futures, Treasury issues, options, CDs, insurance, ETFs, annuities, non-U.S. securities and ADRs, WEBs and Canadian foreign orders.
How much are Charles Schwab's fees?
A list of all the fees Charles Schwab brokerage is charging is under this link.
What are Charles Schwab IRA fees?
A list of all the IRA fees Charles Schwab is charging is under this link.
What interest does Charles Schwab pay on cash?
Charles Schwab interest rates on uninvested cash are discussed in Charles Schwab cash sweep options article.
What are Charles Schwab margin interest rates?
Current Charles Schwab margin interest rates could be found here.
What is Charles Schwab account minimum requirement?
Charles Schwab does not have minimum requirements for brokerage accounts.
What minimum deposit is required to open a Charles Schwab account?
Charles Schwab minimum deposit requirement to open a taxable or an IRA account is $0 for cash account and $2,000 for margin account.
What is Charles Schwab clearing company?
Charles Schwab is self clearing.
How to close Charles Schwab account?
You could learn how to close or transfer your Charles Schwab account under this link.
Updated on 10/29/2024.
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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