You should compare the investing services offered by Merrill Edge and Charles Schwab if you already have a brokerage account with either firm. They’re nearly interchangeable in several respects, and the price difference will depend on your specific situation.
Charles Schwab charges no commission on stock or ETF trades and $0.65 per contract for options trades. There are zero setup, maintenance, or static charges.
Merrill Edge (a division of Bank of America) provides commission-free stock transactions and zero commissions plus $0.65 per option contract. No charges are made for account maintenance or inactivity.
Compared to Merrill Edge, our experts think Charles Schwab’s trading platform is not quite as good. They discovered that Charles Schwab clients get access to a smidgen more markets and goods. Conversely, Merrill Edge’s research and teaching tools are on par with the competition’s.
Merrill Edge Overview
When Bank of America bought Merrill Lynch, it created Merrill Edge to provide a more unified experience for Merrill Lynch customers. You may access your Merrill Edge, and Bank of America accounts with just one login.
Merrill Edge is a good option for investors searching for no fees on stocks and ETFs in addition to a robust research offering, first-rate customer support, and access to financial advisors at over 2,000 Bank of America branches. The MarketPro trading platform caters to novice and experienced investors, with a wealth of teaching materials for the former. Bank of America customers may quickly move money between their bank accounts and Merrill Edge and receive higher credit card points. Any investor, no matter their expertise, would do well to work with this broker.
However, rival brokers, such as Fidelity Investments, Charles Schwab, and Vanguard, provide more than 3,000 fee-free mutual funds, whereas Merrill only offers a few hundred.
Charles Schwab Overview
For consistent excellence, Charles Schwab is hard to beat. This broker excels in nearly every facet of the business and always puts the needs of its individual clients first. Superior research, commission-free stock, ETF trades, user-friendly trading platforms for novice and seasoned investors, responsive and knowledgeable customer service representatives, and a generous sign-up bonus are just a few reasons clients choose this broker. This comprehensive offering has Schwab near the top of our list year after year and at the very top in 2022; it should also be a severe contender for you. It is currently trying to integrate its recent acquisition of TD Ameritrade, with completion expected either this year or in 2023.
American discount broker Charles Schwab serves residents of the United States primarily. The United Kingdom, Germany, Australia, China, Hong Kong, India, Malaysia, Singapore, and the United Arab Emirates are just over 40 nations that can take advantage of its services.
Depending on the country, a different set of services may be offered. Stocks, ETFs, options, and bonds are all that customers in the UK and Hong Kong may trade; no futures or MFs. Charles Schwab may meet most investors’ demands at a reasonable rate.
When you work with a significant player like Schwab, you’ll be able to handle most of your financial needs in a single location. To take your engagement with Schwab beyond a simple brokerage account, you can open a Schwab checking account in a matter of minutes. You may open a bank account with us and still receive the excellent service for which we are known.
The Schwab Intelligent Portfolios service is available if you’d prefer a robo-advisor to handle your investments.
Merrill Edge vs. Charles Schwab Service & Feature Comparison
Costs
The disparity between online discount brokers’ trading commission rates has narrowed as trading expenses have decreased near zero. Let’s compare the prices at Charles Schwab and Merrill Edge.
When it comes to lowering the barrier to entry for the everyday investor, Charles Schwab has been a pioneer. They are the leader in terms of low costs. Charles Schwab has also been instrumental in reducing commissions for its competitors. It was the first principal online broker to do away with commissions for stock trades conducted over the Internet. Since then, everyone else, even Merrill Edge, has caught on.
Regarding pricing, Charles Schwab and Merrill Edge are identical: $0.00 for standard stock trades. Each option contract costs $0.65 at both Charles Schwab and Merrill Edge.
Account Types
Schwab’s Schwab One® account is their principal taxable brokerage offering. Other kinds of accounts, however, are readily accessible. There are 529 plans, UGMA/UTMA accounts, trusts, estates, and institutional accounts available through the brokerage firm.
Those putting money up for retirement also have options. SEP, SIMPLE, Roth, conventional, inherited, and rollover IRAs are some of the varieties of individual retirement accounts available. In addition to traditional 401(k) plans, the brokerage business now provides PCRAs (Personal Choice Retirement Accounts®) (k).
The lack of fees and, except for charity accounts, the absence of minimum balance requirements is perhaps the most vital feature of these accounts.
Retirement Accounts
Both of the firms in our IRA comparison provide IRAs to their customers. In addition to the more common Roth and Traditional accounts, Schwab provides Inherited and Custodial options. Another viable option is rolling over a former employer’s plan into an IRA. In addition to traditional bank accounts, Schwab allows its clients to create trust, charity, SEP, and SIMPLE accounts. In addition, 401(k) plans are available to self-employed people.
Many of Schwab’s duplicate accounts are also available to Merrill Edge customers. On the contrary, Merrill does not provide any philanthropic account option. In addition, closing a retirement account at Merrill costs $49.95, but at Schwab, there is no such fee.
Education and Research
The Charles Schwab website included a wealth of information that proved to be quite helpful to us. To access these tools, go to “Guidance & Retirement” in the main navigation. Webinars and videos are available in plenty. Topics discussed include asset allocation, types of bonds, investing in technology, and dealing with market fluctuations and risk. Other than that, there are articles, self-paced lessons, and calculators for various issues. These included information on various financial topics, including stock market investing, personal finance, annuities, and options.
Merrill Edge also offers security screening tools for all of its available investments. The options strategy builder stood out to us since it includes a little success/failure chart with each plan.
Now let’s check out Schwab, where the instructional resources are slightly less spectacular. In this respect, the broker’s website may use some improvement. However, we did manage to track down resources on topics such as understanding options chains, fixed pricing income, understanding margin, and trading during off-hours.
Schwab, like Merrill Edge, has excellent stock screening tools. Schwab’s website has many stock reports and a wide variety of search options.
Range of Investments
Stocks, ETFs, mutual funds, CEFs, options, futures, and fixed-income assets are all available for trading with Schwab. The second group consists of municipal bonds, zero-coupon Treasuries (including STRIPS), foreign bonds, CDs, MBS, Preferred Stock, and UITs. Bitcoin futures contracts traded on the CME (ticker symbol /BTC) are not included in the definition of “futures,” with CBOE (ticker symbol /XBT) futures contracts are.
Gold, silver, cryptocurrencies, warrants, or CFDs are unavailable through Schwab.
Most investors will be satisfied with Merrill’s equities, bonds, options, exchange-traded funds, and mutual funds. Still, aggressive traders interested in futures and foreign exchange will need to go elsewhere. It’s important to note that Merrill Edge doesn’t sell shares in fractional amounts.
Portfolios & Robo Trading Accounts
Schwab’s Intelligent Portfolios are managed investment packages that include fee-effective exchange-traded funds. The portfolio’s asset allocation is determined by your responses to a questionnaire regarding those aims. These portfolios are overseen by an algorithm that will adjust your asset allocation as it sees fit. In addition, tax-loss harvesting capabilities are included in Schwab’s robo. You can use the proceeds from the sale of investments decreasing in value to pay for the capital gains tax that will be due when you sell equities for a profit. However, the $5,000 entry threshold may be too high for some investors. Robots requiring no or very low initial expenditures are available from companies like Fidelity.
Regarding portfolio development, Merrill Guided Investing does more than simply mirror the market using index funds. The CIO utilizes internal and external investing research to construct portfolios that compete with and hopefully exceed market-matching index funds.
Each model portfolio has three available risk levels, from low to high. Merrill Guided Investing Digital offers clients the option of market-tracking or sustainable investment portfolios. Investment portfolios are built and maintained using strategic and tactical asset allocations that change depending on the user’s objectives, risk tolerance, financial status, time horizon, anticipated returns, and market circumstances. To prevent any appearance of bias, the firm does not utilize any of its own money. Concern for openness and moral leadership is reflected in the absence of private capital.
Trading Technology
Clients of Schwab have access to a website that has been carefully designed. The main menu and the trade bar were both simple to utilize. Positioned in the browser’s footer, it displays up-to-the-moment information about the ticker symbol you’ve chosen to follow. Above the bar, you may view a little chart, but it cannot be used to make trades. A new webpage displaying the broker’s order ticket loads. Traders of stocks and options can make use of its many sophisticated tools.
Customers of both Charles Schwab and Merrill Edge are satisfied with the trading platforms available to them. Merrill Edge is compatible with desktop and mobile browsers. Confident investors use the brokerage’s more robust browser-based tool, Merrill Edge MarketPro. Free trades are available to customers who maintain a balance of at least $50,000 in qualifying accounts, perform 15 transactions each quarter, or meet other loyalty program requirements.
Charles Schwab’s trading platforms can be accessed using a web browser, a desktop application, or a mobile app. In addition to tabbed navigation and real-time quotations, Trade Source is a web browser platform with news for your portfolio holdings. The ability to switch between equities and funds is instantaneous. Its StreetSmart Edge software is a viable option for anyone looking for a comprehensive desktop trading platform. It has better graphing, access to data, and a flexible interface. The best part is that there are no limits on your trading volume or the amount of time you spend on its desktop platforms.
Mobile Apps
And now we reach Schwab’s mobile apps, of which there are two. The first is the StreetSmart Mobile app based on the Central platform. A few problems were discovered during our testing of the program. For example, text occasionally overlapped other text in various modes. However, the app’s robust choice tools and sophisticated trade tickets are much above our anticipations.
The conventional Schwab app, on the other hand, has features like mobile check deposit, live CNBC streaming, bill pay, audio market updates, and money transfers that the StreetSmart app doesn’t have.
For equities that are old enough to have such data, the app’s charting functionality provides price history dating back to 1980. Many technical research tools were located, as well as a variety of graph types. A chart can be flipped horizontally to compare data or to see it from a different perspective.
Banking Tools
While both brokers provide cash management features, they differ significantly in critical respects. Schwab is connected to a banking network. Therefore, it provides brokerage clients with access to checking and savings accounts. A Schwab bank account is available to the general public. Still, the ability to link deposits to brokerage accounts is exclusive to brokerage clients. The Schwab checking account reimburses you for international ATM fees as often as you like. Only Schwab, to our knowledge, has such a liberal policy. Both checks and debit cards incur no fees.
Bank of America owns Merrill Edge. To this day, the broker-dealer does not provide checking or savings accounts for any reason. However, it links a checking account or debit card to a securities account. This service does not have any associated fees. Plus, all ATM withdrawals made at any Bank of America branch are gratis. B of A provides checking and savings accounts that can be linked to a Merrill Edge trading account if you truly need one. However, it won’t give duplicate reimbursements for international ATM fees as Schwab does.
Customer Support
Both brokerages boast around-the-clock support for their clients. We have used Schwab’s chat service many times and found it available at all hours of the day and night. Merrill Edge’s website occasionally offers a live chat feature, which is frequently unavailable. Schwab is the only major brokerage firm that provides customer support in Chinese, while Merrill does not.
Both of those brokers have sizable self-service areas on their respective websites. We uncovered many options for notifications, communication, going paperless, filing taxes, and more.
Suppose you’d prefer not to interact with a robot. In that case, Schwab offers more than 300 physical locations you may visit during business hours to speak with a natural person about your investment needs. Bank of America has more branches than Schwab, but none serve as Merrill Edge customer service locations.
My Preference: It’s a Draw. Both are Winners
Whether you choose Charles Schwab or Merrill Edge may come down to style and personal likes. The advantages and disadvantages of each option are worth considering. Anyone with a Bank of America deposit or investment account benefits significantly from using Merrill Edge, as doing so may streamline several processes.
Conversely, Charles Schwab provides its customers a long list of no-transaction-fee mutual funds. Due to the OneSource platform’s low entry point for investing in many well-known mutual funds, it is a popular choice among new investors. Many investors would benefit significantly from access to non-U.S. stock markets and the option to purchase fractional shares.
FAQ
Do you recommend Schwab?
With almost $8 trillion in assets, Charles Schwab understands how to consistently deliver value to its customers. Among the many notable features are commission-free trading, comprehensive stock analysis, a wide range of trading platforms, and a financial planning service unrivaled field.
Is Merrill Edge any good?
Merrill Edge provides excellent research tools, notably ESG research, and outstanding customer service, all while offering commission-free trading. Furthermore, Merrill Edge’s parent company, Bank of America, has the most generous rewards program in 2022: Preferred Rewards.
What kinds of investments does Charles Schwab offer?
Stocks, bonds, mutual funds, futures, Treasury issues, options, certificates of deposit (CDs), insurance, exchange-traded funds (ETFs), annuities, non-U.S. securities, ADRs, and annuities are just some of the assets that Charles Schwab clients can trade.
Should you sign up with Merrill Edge?
Suppose you’re an investor of any skill level. In that case, this broker probably provides much of what you’d want: reliable research, a wide range of investments, responsive support staff, and cutting-edge features. When it comes to online brokers, this organization is right up there with the best of them.