Fidelity Investments is an excellent match for both beginners and experienced investors because of its investor-friendly approach. Fidelity tops in all areas, including customer service, fee-free mutual funds, cheap expenses, an abundance of information, and the newly added opportunity to purchase fractional shares. The broker also allows you to avoid costs that other brokers still charge, and you don’t pay for it with a difficult website or a negative experience. And did we mention assistance for customers? You may connect with a real person in minutes and, more importantly, get answers to your questions and be on your way.
As a result, Fidelity is an excellent pick for your broker, and since it offers so many financial services, you will be able to expand your connection as your wealth grows. In fact, according to Bankrate’s assessments, Fidelity excelled for novice and retiree investors.
List of Contents
Minimum Balance: $0
Cost per stock trade: $0
Cost per options trade: $0.65 per contract
Commission-free: Every ETFs
No-transaction-fee mutual funds: 3,400+ NTF mutual funds
Securities: Options, stocks, ETFs, bonds, and mutual funds
Customer service: 24/7 telephone, email, and live chat M-F 8 a.m.-10 p.m. ET, and Sat/Sun 9 a.m.-4 p.m. ET.
Account fees: No
Mobile applications: Apple App Store, Google Play Store, and Amazon devices.
Fidelity is the premier internet broker. It stands out as an excellent, all-inclusive platform ideal for aggressive traders, long-term investors, and novice investors.
Fidelity was established in 1946 and made its online debut in 1995. The firm has become a significant player in the internet brokerage industry. Fidelity has always provided investors exceptional research, practical tools, and substantial instructional materials. Moreover, the organization has continued to enhance its platforms and is devoted to reducing investment expenses.
Fidelity offers the most affordable transaction execution of the highest quality. It is uncommon for a broker to allow you to trade stocks, ETFs, and options commission-free and without selling order flow. In 0.07 seconds on average, 85% of orders are completed at a more excellent price than the National Best Bid and Offer (NBBO).
At other brokerage companies, selling order flow helps compensate for the money lost from commission-free transactions, but it often results in a decline in execution quality.
Fidelity charges very cheap fees. It is the only broker we researched that does not charge a fee for outgoing wire transfers. This is a minor detail that demonstrates its overall functionality.
Fidelity has been in the business of mutual funds for seven decades, making it an industry leader. In 2018, the firm introduced index funds with no cost ratios. This demonstrated their dedication to quality and competitive pricing. There are no purchase minimums or transaction fees associated with these ETFs.
Fidelity allows you to trade fractional shares of over 7,000 U.S. equities and ETFs (ETFs). Charles Schwab, a rival, offers only fractional S&P 500 shares. In addition, Fidelity distinguishes itself in worldwide stock trading by giving clients access to the marketplaces of 25 nations.
Two instances of independent research sources that provide studies are Argus and Zacks. In addition, the Fidelity stock screener, the stock research dashboard, and the Active Trader Pro platform’s strength all assist users in identifying potentially successful trading opportunities.
- 24/7 phone line
- Online conversation with a real person
- You may speak with a live broker (there is a surcharge for any trades placed via the broker)
- The chatbot (Fidelity Virtual Assistant)
- Fidelity no longer monitors the average customer support wait time.
Fidelity provides various assets, including stocks, ETFs, options, fixed income, currency, and mutual funds. If forex is your favourite trading instrument, it is preferable to contact Fidelity for information since forex-specific information is not posted elsewhere on the Fidelity website. The mobile app has the same asset classes as Fidelity’s online and Active Trader Pro platforms, making creating and managing trades from any location simple. Fidelity’s product lineup does not include futures, options, or cryptocurrencies. Among Fidelity’s offerings are:
- Longs and shorts of stocks (2,800 on the easy-to-borrow list)
- OTCBB (penny stocks)
- Mutual funds (about 3,500 no-load, no transaction fee)
- Corporate, municipal, federal, and municipal bonds, together with certificates of deposit
- Options with a single leg or many legs
- Robo-advisory built into the website and mobile application
- Geographical (access to 25 countries in 16 different currencies)
- Forex (16 pairs)
- Partial ownership
- Other investments include exchange-traded products, initial public offerings, foreign ORDs, foreign ADRs, preferred shares, rights, warrants, Treasury Inflation-Protected Securities (TIPS), municipal reset bonds, and high yield corporate bonds, precious metals, and principal-protected notes.
Fidelity ranks well in the Best for Low-Cost category every year on several websites. It provides commission-free online trading of U.S. stocks, ETFs, and options, and there are no account minimums or account fees to start a retail brokerage account. The costs of Fidelity are as follows:
- Online equities, ETF, options, and OTCBB trading at Fidelity are commission-free.
- The options contract charge is $0.65 per contract.
- A 50-contract order of options costs $32.50.
- A covered call consisting of 500 shares and five contracts would cost $3.25.
- The purchase fee for mutual funds not participating in the No Transaction Fee program is $49.95, whereas the sale commission is free.
- Interest on margin is 9.075% for a $10,000 balance and 7.575% for a $100,000 balance (as of June 2022).
- There are no costs associated with software, inactivity, account closure or transfer, exercise/assignment, domestic wires, checks, printed statements, or transaction confirmations.
- Most orders incur exchange costs, generally fractions of a cent per share or contract, which Fidelity passes on to its clients.
- Certain families of mutual funds, including Vanguard, CGM, Dodge & Cox, and Sequoia, have an initial purchase fee of $75.
- Each deal incurs a $32.95 live broker charge.
- Before placing an order, you should carefully examine the costs associated with international trading.
On the web and Active Trader Pro platforms, Fidelity provides various order types, including the conventional suspects (market, limit, stop, and trailing stop orders) as well as conditional orders such as one-cancels-the-other (OCO) and one-triggers-the-other (OTO). However, mobile does not presently support dependent ordering.
On the “Positions” page, you can quickly close a position or roll an options order. Using Fidelity’s basket trading services, you can choose up to 50 stocks to track, trade, and manage as a single entity. In addition, you can automatically split your investments among multiple securities with the same dollar amount or number of shares. This is not a feature that most online brokers offer.
If you bought a specific stock over time, you could choose the tax lot when closing a portion of your position. You can also set a default setting for your entire account for the tax lot option, such as average cost or last-in, first-out. You can also set a default setting for your whole account that will reinvest dividends.
Fidelity makes it easy to open a brokerage account, particularly if you have an existing Fidelity account of another sort (e.g., an IRA). However, if you want to add account features such as options trading or margin, you will need to complete extra documentation that might be time-consuming. After discovering the multiple submenus, Fidelity.com is straightforward to browse. There is a search box at the top of most pages if you are having problems locating what you’re searching for.
The web-based platform offered by Fidelity should be enough for investors who adhere to buy-and-hold strategies. Quotes, charts, watchlists, and other features are bundled into a simple, no-frills platform. For example, the “Positions” feature combines research into your portfolio, allowing you to access relevant analysis and news without leaving the site. One reason the web-based platform is more suitable for long-term investors is that order input is not quick. To get an order ticket, you must hover over “Accounts and Trade” and choose “Trade” from the main menu. In addition, a submenu in the account view provides a single-click link to the trade ticket.
Fidelity’s downloadable trading software is Active Trader Pro (ATP). ATP is entirely configurable, allowing you to configure your workplace according to your tastes. You may monitor key news streams, get real-time insights, configure personalized alerts, and trade right from the chart.
The intuitive Fidelity mobile app is accessible on Android, iOS, Amazon, and Google Assistant-enabled devices. With the exception of bonds, the same asset classes may be traded on mobile as on Fidelity.com or Active Trader Pro. The application provides streaming real-time quotations and news along with a limited selection of charting and research tools. In addition, all Fidelity platforms offer access to a customized watchlist.
You may connect to news and research from your portfolio or watchlist symbols on the platform’s user-friendly interface. Unfortunately, quotes and news do not refresh immediately; thus, you must click the refresh button at the top of the page to get current information. However, the streaming button may be toggled on to display streaming quotations in a watch list. You may establish a few trading defaults on the web, such as whether you want a market or limit order, but you must make the vast majority of decisions at the time of trade placement.
Active Trader Pro is more powerful and flexible than the web-based alternative. You may design individualized layouts to display the information that is most important to you. Additionally, you may configure trade defaults, create shortcuts, and use hotkeys to traverse the platform and expedite order input. You may stage orders for later execution and execute basket trades on this platform, which offers chart trading. Streaming real-time data is available across the site, including in watchlists, charts, order entry tickets, and options chains. In addition to a probability calculator, options analytics, and measurements of cross-account concentrations, the platform offers a variety of other features.
On the mobile app for Fidelity, you may trade stocks (including fractional shares), ETFs, options, and mutual funds, but not fixed income. The mobile offering is substantial, with the majority of the same features as the desktop version. Moreover, fundamental analysis and charting are restricted, and you cannot make conditional orders.
Fidelity has just launched a test experience for mobile that provides several of the most-requested features for new consumers, including:
- A redesigned home screen with a streamlined, modernized look.
- A fresh quoting experience that includes faster information.
- A new, simplified trade ticket that is simpler (and quicker) to use.
Security, Reliability, and Transparency
The security at Fidelity meets industry standards:
- Every platform offers two-factor authentication.
- Two-factor authentication is required for high-risk transactions like wire transfers.
- In addition, biometric authentication (facial or fingerprint) is available for mobile app users.
- When customers log in from an unfamiliar browser, they are prompted with security questions.
- Fidelity holds Securities Investor Protection Corporation (SIPC) insurance with a maximum of $1.9 million on uninvested capital. According to Fidelity, this is the most significant excess SIPC protection presently offered by the brokerage sector.
- Fidelity’s Customer Protection Guarantee protects you against damages due to illegal activity in your covered accounts that occurred through no fault of your own.
- In 2021, Fidelity did not record any significant or widespread platform failures.
- In 2021, the Identity Theft Research Center reported no significant data breaches.
Fidelity’s pricing structure is one of the most open and straightforward in the business. 10 No minimums are required to start an account, and the margin rates are among the most competitive in the industry. Commission, fees, and margin rates are all clearly provided in a single location. Commissions on stocks, ETFs, and options are nil, and several expenses that brokers once assessed, such as account transfer fees and bank wire fees, have been removed. The only costs you may need to search for are to foreign exchange; the corporation does not publish information about this asset class on its website, so you must contact for specifics.
In addition to Active Trader Pro, Fidelity has several other tools you can use to improve your trading or get better trade ideas.
Real-time Analytics: In addition to Active Trader Pro, Fidelity offers several other tools to help you improve your trading or get better trade ideas.
Trade Armor: You can see your trading opportunities on a chart using Trade Armor. You can set up alerts to keep track of price changes and figure out the best time to get into and get out of a position. You can also enter orders directly from the tool, among other things.
Daily Dashboard: When you open Active Trader Pro, this tool pops up and gives you real-time news, earnings, and economic news, so you know what’s happening in the market and how it affects your portfolio.
News and Education
On all platforms, the news is accessible from several sources, including Briefing.com, Business Wire, Market Wire, MCT Business News, PR Newswire, Reuters, and SourceMedia Bond Buyer. However, only Active Trader Pro provides real-time streaming news.
The Fidelity Learning Center provides instructional information in various media, such as articles, videos, webinars, infographics, and recorded webinars. In addition, there is a mixture of Fidelity and third-party material, such as courses designed to advance learners. Entering a few keywords in the “What can we help you find today?” box is a simple method for discovering subjects.
Fidelity also offers coaching sessions via the “Trading Strategy Desk,” where you may address trading-related topics with a trained trading coach. The workshops are usually participatory and have fewer than one hundred attendees. Sessions are divided into six categories: daily market updates, options trading, trading tools, trading fundamentals, technical analysis, and live webinar follow-up.
The “Life Events” page (under the “Planning and Advice” menu) is designed to help you through significant life transitions, such as marriage and cohabitation, divorce, navigating the college route, losing a loved one, and purchasing a property, etc.
The mobile applications include “Learning Programs” to assist novices in comprehending market and investment principles. In addition, Fidelity introduced a second mobile app, Fidelity Spire, in July 2020, intending to help users “plan, save, and invest intelligently.” You may establish and prioritize objectives, and the app’s decision-making tool will assist you in determining where to invest to maximize your return on investment. Additionally, Spire provides goal-relevant content.
Fidelity’s instructional services are rounded up with an investment dictionary, a thorough FAQ section, and guest access, enabling non-customers to utilize its research and education.
Pros & Cons
✔ Great trade execution
✔ Efficacious research and asset screening
✔ Numerous academic options
✘ No trading in futures, commodities, or cryptocurrencies.
✘ Restricted to U.S. and principal island residents only
✘ There is no live news or data on the website.
✘ High brokerage transaction costs
- Fidelity enables commission-free online trading of common stocks, penny stocks, ETFs, and options. Nonetheless, there is a $0.65/contract cost. Additionally, the firm has eliminated the majority of the expenses that brokers typically charge for account services, including transfer and account closure fees, domestic wire fees, and check fees.
- Fidelity has fine-tuned its trade execution algorithms with an emphasis on price enhancement. After accepting an order and sending it to a market centre, Fidelity receives the National Best Bid and Offer (NBBO) quotation. The organization transmits orders to as many as fifty market centres, including exchanges, market makers, and automated trading systems that compete for client orders by decreasing prices.
- Fidelity provides a collection of potent research tools and asset screeners to help you choose your next investment. You can use stock, ETF, option, and fixed income screeners as they are or change them to fit your needs. The stock screener includes more than 140 parameters and around 20 topics, including artificial intelligence, drones, and cloud computing. The research on ETFs is exhaustive and provides analyst ratings, themes, and the possibility to search for funds based on a particular stock.
- Fidelity routinely rates well in our Best for Novices category because it provides various instructional resources. For example, the learning centre offers articles, videos, webinars, infographics, and recorded webinars, among other learning resources. Additionally, there are live, interactive sessions with the “Trading Strategy Desk”, where you may connect with experienced coaches and ask them about trading-related issues.
- Fidelity provides the standard investment kinds, including stocks, ETFs, options, and mutual funds. However, the absence of futures, commodities, and cryptocurrencies may discourage some traders.
- To create a Fidelity account, you must reside in the United States or one of the “principal islands,” including Puerto Rico, Guam, and the U.S. Virgin Islands.
- On the mobile application and Active Trader Pro platforms, news and stock quotations are broadcast in real-time, but not on Fidelity.com. You may manually refresh a ticker on the web-based platform by clicking the refresh button next to the ticker symbol.
- A person-to-person trade placement service will cost you $32.95. This broker-assisted charge is above average for the industry and is the highest of all the brokers we examined. For comparison, this cost is often between $0 and $20.
Is Fidelity Investment A Worth Broker to Get?
Fidelity is one of the brokerage businesses with the most excellent alternatives, making it suitable for investors and traders of all skill levels. The majority of the tools buy-and-hold investors need are available on the online platform. Active Trader Pro is for active traders and investors since it includes additional bells, whistles, and customization options. Fidelity shines out due to its cheap fees, potent screeners, excellent trade executions, and extensive educational offerings.
Nonetheless, Fidelity may not be the optimal choice for everyone. Those interested in trading futures, commodities, or cryptocurrencies must seek elsewhere. And although there are tools for options traders, other platforms are more effective at locating trading opportunities. Nevertheless, Fidelity’s extensive array of tools and dedication to helping you earn and save money make it a strong contender for the best online brokerage for the ordinary investor.
Fidelity is likely to be on your short list of probable new brokers, and it’s an excellent pick for practically everything, particularly as your financial demands expand:
- The broker steers an investor-friendly vessel. As a result, there are no account minimums, stock, and ETF trading is accessible, options costs are inexpensive, and there are few fees for essential services.
- Fidelity provides a wealth of information and education to assist you in making informed choices, and if you have any issues, you may get immediate assistance.
- With fractional shares, no-fee mutual funds, several account kinds, and a robust mobile and trading interface, Fidelity delivers its A-game.
Investors seeking another full-service broker might choose Charles Schwab or Interactive Brokers, notably Interactive Brokers’ no-fee service level. Merrill Edge is a wonderful option if you want to do research or merge your Bank of America accounts. Lastly, if you want cryptocurrency access but do not require a premium level of service, you can use other brokers instead of Fidelity.
Once you have completed the registration form to request an account, your application will undergo a verification process that typically takes between one to three days. Once your application has been approved, you will be able to make a deposit and commence trading.
Yes, Fidelity Investment Broker enables you to trade international stocks with access to more than 25 countries’ stock exchanges. However, it’s important to note that there may be extra fees and conditions associated with trading international stocks, such as currency conversion fees and following local tax laws.
Yes, it is possible for you to trade options through their brokerage account as long as they are approved to do so. In order to gain permission to engage in options trading at Fidelity, it is necessary to fulfill certain requirements. This includes filling out an options application that assesses your financial status and prior investment experience, as well as signing an options agreement.
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Source: Bankrate, Investopedia