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Research-backed wealth management and brokerage services with help from a dedicated advisor.
Fidelity Investments is designed for both beginner and experienced investors. It offers tools to customize and analyze your trades, and guidance supported by stock research. But watch out for high management fees and costs for broker-assisted trades.
Peter Carleton is a writer that covers banking and investing, breaking down what you need to know about where you put your money. When Peter's not thinking about cutting-edge banking apps and robo-advisors, he runs a creative agency and spends his spare time cooking or reading.
Who is Fidelity best for?
Fidelity empowers investors to make informed trades backed by research and professional insights, making it best for:
Beginner investors. Fidelity’s website is geared toward new investors with a suite of trading tools and easy-to-digest educational resources. It also offers 24/7 customer service for peace of mind.
Long-term investors. The retirement score tool along with financial planning, advice and wealth management make Fidelity a good fit for those investing for retirement.
Experienced investors. Active Trader Pro is a customizable desktop platform that allows traders to research and execute trades with real-time market data, advanced charting, one-click trading and more.
What are the benefits of Fidelity?
There are a number of reasons why Fidelity is widely considered a solid investing platform:
Commission-free trades. Each US stock, ETF and option trade comes with a $0 commission. Fidelity charges an additional $0.65 per contract on options.
Competitive margin rates. Fidelity has lower-than-average margin rates compared to some of its closest competitors, such as Ally Invest and E-Trade.
Mutual fund advantages. Most of Fidelity’s mutual funds now have no account minimums. You’ll pay no commissions on Fidelity funds. For No Transaction Fee (NTF) non-Fidelity funds, you’ll pay $0 on purchase and $49.95 on redemption if you hold them for fewer than 60 days.
Versatility. Fidelity’s platform is a strong choice for new investors, but the desktop version can be customized to suit the needs of more experienced investors.
Tools and resources. Get access to a suite of resources like Full View, which gives you a snapshot of all of your assets, a free retirement score and more.
Research. Fidelity gets stock research from 19 providers, ETF research from six providers and has a quiz to help customers choose insights from providers that match their investment style.
Easy access. Fidelity allows users to manage their accounts online or via mobile app and offers a Cash Management account — an investment account with checking and ATM access.
Customer service. Fidelity has a reputation for its accessible customer service with 24/7 access and over 140 branches.
What to watch out for
Despite its solid reputation and long list of benefits, there are a few things to look out for if you decide to use Fidelity:
Trade minimum. Fidelity’s active trading platform, Wealth-Lab Pro, requires a minimum of $25,000 in eligible funds in your brokerage account and 36 trades per year.
High fees on certain mutual funds. There’s a $49.95 purchase fee on non-Fidelity mutual funds.
Management fees. Fidelity portfolio advisory and wealth management fees are similar to what is charged by standard investment advisors.
Broker-assisted fee. If you need the help of a broker to make a stock or ETF trade, expect to pay $32.95.
Robo-advisor. Fidelity’s robo-advisor has higher fees than some competitors, and it doesn’t offer tax-loss harvesting.
Case study: Liza’s experience
Liza Schneider Client Services
I rolled my 401(k) into a Fidelity IRA a few years ago. The product is as advertised: I manage the account and research, buy and sell all of my own stocks. Every year I contribute the max allowed by law before taxes kick in (in 2019, it’s $6,000), but no more, and then I let the market do its thing.
This kind of account works well for people who don’t have a large enough portfolio to justify managed service, but have the time and ability to choose their own stocks and the appropriate portfolio mix.
Fidelity provides a few handy research docs and daily tips. But, otherwise, you’re on your own, in my experience. The interface is easy to follow, and I appreciate that it shows me if I’m too heavily invested in one sector versus another.
What do other investors say about Fidelity?
While Fidelity has won awards from various review websites and has many satisfied customers, it doesn’t have a great reputation on the BBB website. It isn’t BBB-accredited, holds a C- rating and has a 1 out of 5 star customer review score.
However, keep in mind that many customers will only take the time to leave a complaint if they have a negative experience, which could be why you don’t see as many positive reviews online.
Compare with other robo-advisors and stock trading platforms
You can fund your account with a transfer from an existing bank or brokerage account. Submit your funding information during your application, then make a deposit into your Fidelity account to start trading.
Money invested in stocks, bonds and other assets is not insured. However, uninvested cash is covered for up to $1.25 Million through FDIC insurance across multiple program banks.
You can send an ETF to your bank, request a check to be sent to your address or send a wire to your bank.
Call the number on your account statements or the general customer service number and let them know you’d like to close your account. Otherwise, you can send a letter with your account number, contact information, account holders and all other important account-related details.
Fidelity offers a lineup of its own mutual funds and ETFs that are free to trade, but any products that are not in this program will be subject to fees.
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