Merrill Edge vs Fidelity: Comparison and Review (2020)

Merrill Edge vs. Fidelity

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Investors looking for a full-service brokerage that prioritizes customer service will be interested in both Fidelity and Merrill Edge.

Both brokerages have easy-to-use tools and mobile apps for stock trading. With zero commission fees, both platforms make it easy to find new stocks, monitor stock performance, and diversify their portfolios, but which one has the tools for your investor personality?

Merrill Edge is smaller – with fewer customers and assets under management – and not as well known for their adept trader tools, as is Fidelity. More services and educational tools, like Fidelity Go, make it easier for investors to set up a portfolio and monitor its performance.

Fidelity also offers more tools for different asset classes, including mutual funds and options.

Merrill Edge vs Fidelity – Quick Comparison 

Merrill Edge offers some basic tools and commission-free trades, but Fidelity has way more options with its desktop and mobile platforms.

Merrill Edge

  • $0 commission fees on stocks, ETFs, options, and no-transaction-fee mutual funds
  • Merrill Edge offers in-depth portfolio analysis tools and reports, as well as a mutual funds database
  • Most of Merrill Edge’s educational offerings can be found on the website, and there are hundreds of articles, reports, and tutorials available
  • Passive investors will get the most out of the browser-based platform
  • Merrill Edge’s mobile app lets traders check in on their portfolios on-the-go with basic order types available

Fidelity

  •  $0 commission fees on stocks, ETFs, options, and no-transaction-fee mutual funds
  •  Fidelity is a full-service brokerage well known for its high-quality trade executions, mobile apps, and zero cost mutual funds
  •  The Active Trader Pro desktop platform offers more tools for frequent traders and is fully customizable
  •  Customizable charting tools, options analysis, strategy testing, and educational resources available on the web, desktop platform, and mobile app
  •  Fidelity’s mobile apps sync up to the web and desktop platform thanks to its cloud technology
  •  Margin rates are lower than Merrill Edge but still high in comparison to other brokerages like Robinhood

Fees and Commissions

Fidelity and Merrill Edge both offer competitive commission-free trades on stocks, ETFs, and options. Both offer $0.65 per options contract. They also offer $0 trades on no-transaction-fee mutual funds, but the prices differ for no-load, transaction fee funds.

Merrill Edge advertises unlimited $0 online stock and ETF trades without any account minimums. With little differences in commissions and fees, here are some small differences between the full-service brokerages.

  • Both have no-transaction-fee mutual funds, you’ll pay $19.95 for no-load, transaction-fee funds
  • Fidelity charges $49.95 for all non-Fidelity funds
  • Broker-assisted trades cost $29.95 with Merrill Edge, and Fidelity charges more at $32.95
  • Merrill Edge has a higher 10.13% margin rate than Fidelity at 9.33%
  • Account fees at Merrill Edge are higher with $49.95 IRA closure fees, $30 returned ACH fees, and $500 stock certificate processing fee, and fees for paper statements, paper confirmations, and wire transfers
  • Fidelity only charges a $100 stock certificate delivery fee

Overall, Fidelity is the lower-cost brokerage, while Merrill Edge combines banking tools with trading. The result is that Fidelity operates with less fees and offers more research tools.

Winner: Fidelity has the better platform for investors when it comes to account fees, margin rates, and commissions.

Investment Selection

Investment selections are pretty straightforward for Merrill Edge, mostly because it combines banking with trading. It’s not meant to be used as a high-velocity trading platform, which is why passive investors saving for retirement will like it more.

Merrill Personal Investing Trading

Merrill Edge customers are able to buy and sell fixed-income securities, as well as ETFs, closed-end funds, options, stocks, and mutual funds. You can trade them with taxable and non-taxable accounts.

As for options, Merrill Edge only offers a max of 2 legs in comparison to the 4 legs for Fidelity’s complex options.

Fidelity offers the same range of investments, but you can also access international trading and forex. You can also access life insurance products, which is unique to Fidelity. In addition, you can trade with taxable and non-taxable accounts, and you can set up estate and trust accounts.

Fidelity Life Insurance

In addition, Fidelity has more mutual funds with over 3,900 no-load funds in comparison to just 2,471 from Merrill Edge.

There are also way more order types available with Fidelity. In comparison, you can’t make contingent, multi-contingent, OCO, OTO, or OTOCO orders with Merrill Edge.

Winner: Fidelity has expanded upon the basic offerings of 10 years ago, whereas Merrill Edge continues to offer just the basics for mainly Bank of America customers and retirement investors.

Online Advisors and Educational Offerings

Fidelity is a modern brokerage and offers all the tools that go with it, but Merrill Edge also offers extensive educational resources.

Merrill Edge Advisors and Educational Offers

While most brokerages offer a robo-advisor, Merrill Edge created Guided Investing, which offers low-cost managed account programs that cost 0.45% per year. However, it requires a $5,000 account minimum to start investing.

Guided Investing only offers clients the ability to buy and sell ETFs. Investors can go to Bank of America locations and talk to a broker for a 0.85% fee per year.

The broker’s website offers a variety of resources including webinars, tutorials, videos, and articles. You can learn more about fixed-income products, mutual funds, options, and annuities.

There are also plenty of tools for retirement, such as planners and calculators. You can access stock reports from S&P Capital and Morningstar.

However, Merrill Edge does not have the tools for analysis and streaming real-time data like other brokerages. Active traders will not benefit from these tools, which is why Merrill Edge is better for passive investors who want to save for retirement.

Fidelity Advisors and Educational Offers

Fidelity customers can access Fidelity Go – a top robo-advisor service -that helps clients invest in low-cost mutual funds and ETFs. The service costs 0.35% per year, which is deducted from your portfolio each quarter. Human advisors also monitor your portfolio and help to rebalance your investments for maximum return.

Portfolios are built from more than 10 funds and cover six different asset classes, but Fidelity primarily uses Fidelity Flex zero-cost index funds. While there is no tax-loss harvesting and rebalancing is done as needed rather than automatically, clients also have access to investment and retirement planning tools.

As far as educational tools, analysis, and screeners, Fidelity provides access to stock reports from Ford Equity Research, Zacks, Thomson Reuters, and more. You can access articles, videos, and webinars as well. You can also use tools to help for college planning, find the best ETFs, and get ideas for options strategies.

Winner: Fidelity offers more advisor and trading tools than Merrill Edge, but retirement investors may prefer the simple planning tools and integration with Bank of America accounts.

Trade Experience and Security

Investors can access Merrill Edge’s platform right on the website. There is a trade bar at the bottom that can quickly place orders for stocks, ETFs, and options.

There is also a small graph. There are some useful features, such as charting, technical studies, and a few drawing tools. However, most of the technology feels outdated and does not use real-time data.

Merrill Edge also offers a desktop platform, and while it can be used for more active traders, it’s not the greatest for high-velocity traders. In addition, Merrill Edge handles order flow and execution differently.

While investors do not have to pay for order flow, execution venues are used to compete and execute customer orders. This means customers are likely to get the best bid price for a trade.

While the site has not changed much, the menu system was updated recently so that it has tools and features comparable to most brokerages. Their MarketPro tool allows you to set up more customization than the website, such as a layout according to preferences for your news feed and charts.

Like Merrill Edge, investors can trade on Fidelity’s website, as well as a desktop platform and mobile apps. The online trading platform is easy to use and detailed with advanced screener tools and tons of research options. You can also find strategy testing tools that use 10 years of historical data.

Active traders can use Active Trader Pro, which is Fidelity’s downloadable desktop platform. All investors can use this platform free as of 2019. Investors can use the web-based version as well.

The platform is completely customizable with shortcuts, technical analysis filters, options filters, advanced tools, and a multi-trade ticket ordering system.

In addition, Wealth-Lab Pro is a desktop strategy testing program that allows traders to customize strategies and utilize more than 20 years of historical data. However, this product is only available to investors who trade at least 36 times in a year and have $25,000 in assets.

Both offer security through two-factor authentication and offer fraud coverage through SIPC. Fidelity offers an account security guarantee and protects clients with security challenges if a change is detected with their device.

Winner: Fidelity offers the better trade experience with high-quality trade execution. Both offer amazing, browser-based trading platforms, but Active Trader Pro and Wealth-Lab Pro offer more options and resources for investors.

Mobile and New Trade Tech

Both brokerages offer mobile apps that can be used to trade on iOS and Android. Merrill Edge also offers an Apple Watch app. You can check on all of your accounts with Merrill Edge’s app, and investors can also monitor streaming quotes.

Merril Apple WatchAll apps have access to Bank of America and Merrill Lynch research reports. While you can trade on the mobile app with simple order types, you can also access trading on the watch. However, traders have to finish the order on the website.

Fidelity has multiple apps, including the Active Trader Pro app, which allows you to access all asset classes and order types. You can even input complex order types.

The startup screen can be customized on all of Fidelity’s mobile apps, and guidance is available for all trade tickets in case investors need additional help. Watchlists also sync up on mobile devices and the website, and there are a few research tools and basic charts you can access within the Fidelity mobile app.

Winner: Both mobile apps allow you to monitor accounts, but Fidelity has the better trading tools for mobile.

Frequently Asked Questions: Merrill Edge vs Fidelity

Which is better for retirement accounts: Merrill Edge vs Fidelity?

Merrill Edge is known for its retirement planning and portfolio analysis tools. Merrill Edge’s clients can invest in a variety of mutual funds for free. There are more than 7,500 mutual funds, which includes 2,700 plus no-load, no-transaction-fee funds.

You can access account management tools and even visit branches to talk to a broker. With the online database, you can search through reports bonds and equities to help you diversify your portfolio.

The Portfolio Story tool on Merrill Edge’s website also allows you to analyze your portfolio, including regional and sector analysis. You can see how your assets are allocated and also look for ways to improve.

There are a variety of retirement planning tools available with Fidelity as well. You can pull all of your accounts into FullView for a portfolio analysis, and you can access a broker for more analysis.

There are more than 3,500 NTF mutual funds. There are over 11,000 funds in total, so it’s easy to pick and choose what you want to invest in.

If you choose Fidelity Go as your robo-advisor, you can set up a retirement portfolio in minutes based on your goals, timeline, and risk tolerance. It’s easy to start earning, and the robo-advisor does everything for you.

Does Merrill Edge or Fidelity offer better customer support?

Fidelity offers 24/7 customer support through live chat, phone support, and email. You can reach a person to talk about your accounts at any time of day or night. Their responses are quite fast and helpful.

Merrill Edge does not offer the same 24/7 customer, but you can access phone support Monday through Friday or visit a branch location.

Which One is Right for You?

Depending on your retirement plan and how you want to invest, there is something for passive investors with Merrill Edge. If you are a Bank of America customer, it makes sense that you would want to create a retirement plan with Merrill Edge.

However, if you want to do more than invest and want access to more mutual funds with zero cost, Fidelity has a few more tools and options. For instance, you can use their downloadable platform Active Trader Pro and set up multiple accounts with complex order types.

If that sounds a bit overwhelming, Fidelity has several education tools and resources to help you learn more about these other assets.

Ultimately, Fidelity may be able to help you expand your investments and analyze your portfolio in-depth in a more intuitive way.

About Author

Tim Fries Tim Fries is the cofounder of The Tokenist. He has a B. Sc. in Mechanical Engineering from the University of Michigan, and an MBA from the University of Chicago Booth School of Business. Tim is also the co-founder of Protective Technologies Capital (protechcap.com).