Merrill Edge vs. Fidelity

When you're ready to invest in the stock market, you'll need to open a brokerage account to buy and sell stocks, exchange-traded funds (ETFs), and mutual funds. These days, most people open an online brokerage account and do their stock trading from the comfort of their home.

Many investors consider Merrill Edge® Self-Directed vs. Fidelity -- two popular choices -- when picking a broker. They both rank highly among the best brokers for beginners and with experienced investors. Here's how Merrill Edge® Self-Directed vs. Fidelity compare on prices, research, trading platforms, and more.

Merrill Edge vs Fidelity: At a glance

Trading costs and commissions

Fidelity and Merrill Edge both offer competitive trading commissions. You can buy and sell stocks, ETFs, options, and mutual funds without breaking the bank.

Let's compare Merrill Edge® Self-Directed vs. Fidelity on commission prices by type of investment. Both Merrill Edge and Fidelity have no transaction fee for a stock or ETF transaction. Other fees are as follows.

As you can see, both brokerages have joined the $0-commission revolution and are evenly matched when it comes to options trading. Both charge commissions for broker-assisted stock trades, however.

How do Merrill Edge vs. Fidelity compare on commissions charged for mutual fund orders? They both have fees. But it's important to note that they both offer thousands of no-transaction-fee (NTF) mutual funds. It's very easy for fund investors to avoid them.

Mutual fund investing

Let's look at Merrill Edge vs. Fidelity on mutual fund investing.

Fidelity and Merrill Edge both maintain a list of NTF funds. That means they don't charge a fee to buy or sell.

The brokerage choice is a personal one. People who invest in mutual funds may consider fees the single most important factor. Both Fidelity and Merrill Edge offer thousands of mutual funds on a no-load, NTF basis. 

Fidelity has a suite of completely free index funds for its customers. These funds have no transaction fees to buy or sell, and they don't charge management fees. So you could open an account with Fidelity, pay nothing to invest in its Zero funds, and then pay nothing in ongoing management fees. The result: a completely free investment portfolio.

Account minimums

When it comes to account minimums, Merrill Edge vs. Fidelity is a close match.

Fidelity and Merrill Edge offer no-minimum accounts, which may be a good fit for investors who want to start small when they open a brokerage account. So, even if you can afford to deposit only $100 today and make small deposits over time, either broker could work for you.

You will need to have enough money to buy at least one share of a stock, ETF, or mutual fund to make a trade to invest with Merrill Edge. It's even better if you have enough money to diversify your portfolio. However, with Fidelity's Stocks by the Slice, you can buy fractional shares of more than 7,000 U.S. stocks and ETFs for as little as $1. 

Trading platform

Which trading platform is better, Merrill Edge vs. Fidelity? 

Both of these popular brands are online brokers. Active traders tend to demand more from a brokerage than long-term investors. Fidelity caters to both types, offering an easy-to-use browser solution as well as a fully featured platform for active traders. Its basic web interface offers streaming quotes through its watch list feature. You also get some basic charting tools. Fidelity's Active Trader Pro platform on desktop offers all the functionality you'd expect from a real trading platform. 

Merrill Edge offers a browser-based solution as well as its desktop trading platform Merrill Edge MarketPro. The platform offers many analytical tools, screens, and a customizable display. Nonetheless, some users lament a few missing features. For example, it doesn't have a way to make complex options trading or conditional orders. Investors who keep a combined balance of $50,000 in eligible Merrill Edge and Bank of America accounts or make 15 trades per quarter qualify to use Merrill Edge MarketPro.

As long-term investors ourselves, we don't obsess over trading platforms. The truth is that a "good" trading platform often comes down to personal preference. So try a few out (most have demo modes) before you decide.

International stocks and ADRs

Let's compare Merrill Edge vs. Fidelity on international stock trading and American depositary receipts (ADRs). 

Fidelity's clients can trade on international markets in 25 countries and in 16 currencies. Its customers can also trade ADRs. These are shares of a foreign stock that trade domestically. The only downside is that international trading costs more at Fidelity. Investors will pay a commission that varies by country and exchange.

Merrill Edge customers can trade ADRs, but the broker doesn't allow for trading directly on a foreign stock exchange. So, while you'll have no problem buying shares of BP or Burberry with an ADR, Merrill Edge isn't a good fit to trade stocks that trade only in London, for example.

Many investors get exposure to international markets simply by holding diversified mutual funds and ETFs. If that's how you plan to invest, there isn't a meaningful difference between Merrill Edge vs. Fidelity -- or any online discount broker, for that matter.

Penny stocks

In a Merrill Edge vs. Fidelity match on penny stocks, Fidelity has the advantage. You can't buy or sell penny stocks through Merrill Edge. Fidelity may allow you to trade penny stocks, but you'll need to enable penny stock trading on your account, which requires you to acknowledge the risks involved.

Research quality and tools

As a general rule, investors benefit from having access to a wealth of research tools and opinions. Looking at Merrill Edge vs. Fidelity, both have robust offerings.

Fidelity often takes the top spot in research among discount brokerages. It provides research from 12 independent research firms. The brokerage makes it easy to view analyst upgrades and downgrades. Fidelity provides access to Thomson Reuters StarMine. This service combines analyst ratings and weights them by the analysts' historical accuracy. Fidelity also offers its own proprietary "thematic" research, such as deep dives into certain sectors or investment themes (think a white paper on FANG stocks, for example).

Merrill Edge stands out for its relationship with Bank of America, offering access to BofA/Merrill Lynch ratings on more than 1,300 U.S. stocks. In addition, customers can tap into a wealth of research from Morningstar and Lipper for funds, as well as Merrill Edge's proprietary Stock Story feature for individual stocks. Merrill Edge also offers downloadable research for mutual funds and ETFs, which sets it apart for investors who prefer to invest in funds instead of picking individual stocks.

Merrill Edge also offers Merrill Guided Investing. This is an oversight and monitoring platform for investors who want input from experienced investment professionals. It's not quite a robo-advisor because this service combines technology with human insight from a financial advisor.

The Merrill Edge mobile app lets you access your linked Merrill and Bank of America accounts anytime on your mobile device. 

Not to be outdone, Fidelity also offers mobile apps that let you trade anytime, anywhere. Investors can view a personalized feed on either iPhone or Android.

Who wins: Merrill Edge vs. Fidelity

The Merrill Edge vs. Fidelity matchup leaves investors with two solid options.

Whether you invest in funds or individual stocks, you can find plenty to like about Fidelity and Merrill Edge's $0 commission stock trades, access to research, and highly rated mobile apps. In short, the Merrill Edge vs. Fidelity comparison is pretty close, and comes down to the features that are most important to you. 

Fidelity scores a win for having the only completely free Zero mutual funds, which let long-term investors build diversified portfolios of free investments. And Fidelity is the clear choice for investors who want direct access to international markets, although this isn't too common. On the other hand, Merrill Edge gets a win for people who have an existing relationship with Bank of America, as their accounts can be smoothly integrated.