Fidelity vs Merrill Edge

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    Fidelity and Merrill Edge are two online brokers that offer different financial products for US and international investors. 

    Merrill Edge, the Bank of America broker, managed to earn the trust of users thanks to its customizable trading platforms and security measures. 

    Fidelity highly focuses on customer support, and on offering a wide variety of investment products. 

    In this article, we will cover the characteristics of these brokers, along with their fee schemes, investment platforms, available products, the security measures they take, and the quality of their customer support services. 

    Fidelity vs. Merrill Edge – it’s not easy to establish which one is better, and users should choose according to their needs (basing their opinions on objective data and the attention paid to security).

    Overview of Fidelity & Merrill Edge

    FeaturesFidelityMerrill Edge
    💰 Account Minimum$0 for brokerage accounts and $2,500 for managed accounts$0
    💸 Commission Fees$0 for stocks, ETFs, and options trades. $0.65 per options contract. Mutual funds have $49.95 transaction fees.$0 for online equity and ETF trades; $0.65 per options contract; other fees may apply
    💼 Investment OptionsStocks, bonds, ETFs, mutual funds, options, and CDsStocks, bonds, ETFs, options, mutual funds, and more
    🤖 Robo-AdvisorFidelity Go, which charges a 0.35% annual advisory fee and has a $10 minimum investmentMerrill Edge Guided Investing offers a robo-advisory service with a minimum investment of $5,000 and an annual fee of 0.45% of your account balance
    📊 Research and AnalysisExtensive research and analysis tools, including reports, screeners, and educational contentMerrill Edge offers a range of research and analysis tools, including stock and fund screeners, market insights, third-party research reports, BofA Global Research, and more
    📱 Mobile AppFidelity Mobile AppMerrill Edge mobile app is available for iOS and Android devices, offering trading, research, and account management features as well as access to your Bank of America accounts
    🏦 Retirement AccountsTraditional and Roth IRAs, SEP IRAs, SIMPLE IRAs, and 401(k) plansTraditional IRA, Roth IRA, rollover IRA, SEP IRA, SIMPLE IRA, and individual 401(k) with no minimum investment and no annual account fees
    📈 Trading PlatformFidelity offers a web-based trading platform and the Active Trader Pro desktop platform for frequent tradersMerrill Edge offers a web-based platform, as well as a mobile app, for trading and account management
    📞 Customer Service24/7 phone support and online chat. Over 190 branch locations for in-person support24/7 phone support, live chat, email support, and more
    📚 Educational ResourcesExtensive educational resources, including articles, videos, webinars, and coursesMerrill Edge offers a range of educational resources, including articles, videos, webinars, and more
    🌕 Fractional SharesYes, through Fidelity’s mobile app and websiteNo
    🌱 Socially ResponsibleOffers ESG-focused funds and tools for socially responsible investingMerrill Edge offers a range of socially responsible investment options, including mutual funds and ETFs
    🌎 International InvestingNoMerrill Edge offers access to international markets, including Canada, Japan, and more
    💳 Cash ManagementFidelity Cash Management account offers FDIC-insured checking and ATM fee reimbursementsMerrill Edge offers a cash management account, which includes a debit card and ATM fee reimbursement
    🔍 Margin TradingYes, with competitive ratesYes, margin trading is available with Merrill Edge. You need to have $2,000 in your account to start.
    ⚙️ Options TradingExtensive options trading tools and resourcesMerrill Edge offers options trading with $0 commission fees for online trades and $0.65 per options
    ₿ Cryptocurrency TradingNoMerrill Edge does not currently offer cryptocurrency trading
    🛡 Account SecurityTwo-factor authentication and advanced encryption technologiesMerrill Edge uses industry-standard security measures, including two-factor authentication, encryption, and more
    💹 LeverageNoMargin trading allows for leverage
    ⚖ RegulationFidelity is regulated by the SEC and FINRA in the US, and the FCA in the UK. It is also a member of SIPC.Merrill Edge is regulated by the Securities and Exchange Commission (SEC), the Financial Industry Regulatory Authority (FINRA), and other regulatory bodies in the US.

    Fees and Commissions

    Both Fidelity and Merrill Edge aim to provide investment products at little to no cost. Nevertheless, the fee and commission schemes of the two online brokers differ, and different products can have different types of commissions and fees. 

    To dive deeper into the topic, let’s analyse the fees and commissions associated with the products offered by the two. 

    These are Fidelity’s fees and commissions: 

    • US stocks can be traded for 0% commission;
    • Options cost $0.65 per contract – but regulatory fees, not charged by the broker, apply (from $0.02 to $0.04);
    • No commissions are applied to ETFs (Exchange Traded Funds) and CDs (Certificates of Deposit);
    • No commissions are applied to new bond issues – but for secondary issues, traders need to pay $1 per bond;
    • No commissions are charged for Fidelity mutual funds, but commissions up to $49.95 can be applied to non-Fidelity funds;
    • Fidelity applies fees to foreign exchange wires (up to 3%), DTC (Depositary Foreign Trust Company) settlement fees ($50 per trade), transfers of stock certificates ($100 per certificate), foreign dividends (1% of the principal, calculated on each transaction), $32.95 is charged to accounts in case of margin liquidations;
    • For margin trading, fees are based on the margin balance of each investor’s account – the lower the balance, the higher the fee (from 8.75% to 13.075%). 

    Merrill Edge tends not to apply fees and commissions to its investment products. The exceptions are options ($0.65 is applied to each option contract trade), mutual funds (if held for less than 90 days, they can cost up to $39.95), secondary trades on bonds cost $1. Moreover, and this is one of the main differences between Fidelity and Merrill Edge, Merrill Edge charges $29.95 in every product if there is the assistance of a live broker.

    Both online brokers are cost-effective, but in the case of Merrill Edge this applies only in the case of self-directed, independent accounts – otherwise, Merrill Edge can result in higher costs. 

    Trading Platforms

    Both Fidelity and Merrill Edge provide users with tools that can allow them to analyse markets, get insights, do research, and trade or invest by using different devices. 

    Both online brokers consider the possible needs of investors who are beginning, and more experienced investors who need more complex tools. 

    To dive deeper into the topic, we will analyse the features of the trading platforms of both brokers. 

    Fidelity has both a desktop and a mobile platform. The two can be synced to allow any user to follow their trading activity even when they’ve no access to a PC.

    The desktop platform comes in the form of Active Trader Pro, a platform created by Fidelity with proprietary technology – it can be downloaded on PCs. 

    From there, users can: 

    1. Check price charts, 
    2. Read news, 
    3. Open orders – with different levels of complexity, 
    4. Check bid and ask prices, 
    5. Check volume and liquidity of the asset, 
    6. Get more information about the assets they want to invest in. 

    The sidebar allows users to have their watchlists constantly under control. 

    The online platform has the same functionalities – but it’s not downloadable. It can be used on both PCs and mobile devices, but if users prefer a mobile-designed platform, they can use the official application of Fidelity. 

    Also, Merrill Edge offers similar types of platforms: MarketPro and a mobile app. 

    The focus of Merrill Edge is on customization. The online trading platform is fully customizable – users can actually build their own almost from scratch. 

    They can save and use up to 25 layouts, built on predetermined characteristics, and mix the tools provided by the broker. For instance, they can choose to focus more on price charts, to add the details of their portfolios, to include watchlists, analysis, quotes and different assets. 

    An interesting aspect of Merrill Edge is that it also offers an idea builder. Users who are not sure about the type of assets they’d like to invest in can start from an idea – for instance, social responsibility – and get the suggestions provided by the broker according to data and analysis. 

    Both brokers offer valuable trading platforms, but with different focuses: while Merrill Edge is more oriented towards self-directed trading and allows for higher levels of customization, Fidelity built platforms that can be used by traders and investors with different levels of experience and don’t want to create fully customizable trading platforms.

    Investment Options

    Merrill Edge and Fidelity provide users with different investment products. 

    Merrill Edge allows traders and investors to access: 

    1. Stocks, 
    2. Options, 
    3. Fixed income products – like CDs and bonds, 
    4. Annuities (investment products designed for retirement), 
    5. Mutual funds,
    6. ETFs (Exchange Traded Funds),
    7. IRAs. 

    Also, Fidelity offers both general products and investment products focused on specific segments: 

    1. Investment products related to retirement – like IRAs and annuities;
    2. Mutual funds;
    3. Stocks; 
    4. Cryptocurrencies – but the Fidelity Crypto account is available only for citizens of eligible US states;
    5. Fixed-income financial products – like CDs and bonds;
    6. Life insurance;
    7. Options; 
    8. ETFs;
    9. Products related to health and college savings. 

    Also, Fidelity offers types of investments that involve assets in the same sector or industry and, like in the case of Merrill Edge, also Fidelity offers managed investing and trading. 

    So, both online brokers offer quality investment products, which can offer traders and investors a wide range of choices to meet their needs. 

    Generally speaking, Fidelity offers a higher number of products, as well as more specific investment products for health, life insurance, and other types of savings accounts.

    Customer Service

    Both Fidelity and Merrill Edge offer complete customer services, to help users solve any problem related to the broker, or to improve their customer experience and solve doubts. 

    The services offered by the two brokers differ. 

    Merrill Edge has an extensive knowledge base and education platform, which helps not only to solve issues and doubts related to the broker, but also to understand the different investment products provided. 

    Another means customers can use to get support is the phone call. A third method consists of the opportunity to schedule an appointment in-person – Merrill Edge is a Bank of America company, and customers can benefit from the offices of the bank. 

    Fidelity has a more complete customer service. Along with the help page, which contains information related to everything concerning the broker, Fidelity offers contacts via phone call, live chat with the customer care team, and the virtual assistant – powered by artificial intelligence – available 24/7. 

    So, even if the two brokers have valuable customer services, Fidelity offers more ways to contact the platform. 

    Security

    For security, both Merrill Edge and Fidelity take the necessary measures to protect customers. 

    Merrill Edge, as a company owned by Bank of America, is one of the FDIC members – even if investment, insurance and annuities are not FDIC insured. The broker falls under offered by the insurance company Merrill Lynch Life Agency Inc.

    Moreover, the company secures customers and data through a high level of encryption, fraud detection systems, a highly complex and secure process to authenticate users, and login codes. 

    Also, Fidelity uses security measures that can allow users to protect their accounts and data. 

    The broker enables 2-factor authentication to allow users to add another layer of security to their accounts. Fidelity also provides biometrics technology for verification – like the voice authentication, provided both via phone or devices’ microphones. 

    Moreover, users get instant alerts in case of suspicious activity. Users can also block their funds in case of unauthorised activity, and eligible users can be included in the Fidelity Customer Protection program to further protect their funds.

    Conclusion

    It is hard to assess which broker is better. Both offer different investment products, focus on the different needs of users – for what concerns both trading platform complexity and specific savings accounts, both take highly tech measures to protect their customers, and helpful customer care services. 

    If you consider elements like customer service and the variety of investment products offered, Fidelity seems to be slightly superior – but it’s always up to users to choose the best online broker according to their needs.

    FAQ

    Do Merrill Edge and Fidelity have trading platforms?

    Yes. Both brokers have proprietary trading platforms that can be used online, in the downloadable desktop versions, and as mobile applications.

    Which broker offers better customer service?

    When comparing the customer services offered by the two brokers, Fidelity is slightly superior – since it offers more means to reach the customer team, and the virtual assistant is available 24/7.

    Which broker offers the highest number of investment products?

    Fidelity offers more investment products than Merrill Edge – retirement products, mutual funds, stocks, cryptocurrencies, fixed income products, life insurance, options, ETFs and different savings products.

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