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Fidelity Review From A Trader’s Perspective

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In A Nutshell 

Fidelity is one of the oldest and most renowned brokers in the U.S. and globally. It has been founded in 1946 and currently operates with $3T in client assets. It also provides a comprehensive online experience which is a subject of this review. 

The best parts: Fidelity offers customers the possibility of $0 stock trades, extensive researching and learning opportunities, comprehensive retirement services, and an easy-to-use mobile app.

Their fees are in line with most similar online brokers. The broker doesn't charge any commission for online equity, ETF or OTCBB (penny stock) trades.

There are no fees for inactivity, account closure or transfer, exercise/assignment, sending and receiving wires, sending checks, or paper statements and trade confirmations.

The broker makes money, among others, with interests on cash and stock loan programs.

We found their trading catalogue extensive; it ranges from stocks to bonds options, including international stocks. Notable exceptions: forex and futures trading are not available.

Fidelity is fully licenced and regulated by the Financial Industry Regulatory Authority (FINRA) and the Securities and Exchange Commission (SEC).

In terms of safety and reliability, Fidelity is one of our tops choices. It is regularly awarded as one of the best online brokers in the recent years.

A large set of tools, videos, educational resources, and low fees makes Fidelity one of the top online brokers for beginner - or experienced - traders. 

Good:

  • Reliable Research Tools
  • 0$ stock trading
  • Competitive costs
  • No inactivity fees
  • Excellent Web Trading Platform
  • International Stocks 
  • Several base currencies

Bad:

  • Not fully digital account opening
  • Third mutual fund fees are high
  • Financing rates are high
  • No debit/credit card option
Overall score: 9.5/10

1. Fees and Spreads  

Fidelity has low non-trading fees and low trading fees. Stock trading doesn't charge commissions.The rates for some financial instruments and mutual funds, on the other hand, can be high. 

Good:

  • Low non-trading fees
  • Free ETF and stock trading
  • Some mutual funds are free
  • No inactivity fee

Bad:

  • High financing rate
  • High costs for Non-Fidelity Mutual Funds


Fidelity, similarly to many other online brokers, recently eliminated their trading fees for online trading. They introduced zero commission fees in October 2019 as well as zero-expense Fidelity mutual funds and reduced index funds.

Margin rates, on the other hand, are relatively high at Fidelity; they begin at 4 percent. Trading on margin means that you borrow money from your broker and can purchase more shares than you could with just the available cash in your account. You have to pay interest on this borrowed money – the interest rate is called the margin rate. 

All the prices are transparent and listed on their website in full. See our breakdown below for more information on prices for specific assets:

Stocks:

  • $0 per stock or options trades
  • $0.65 per contract on option
  • international trades incur a fee, depending on the market

ETFs

  • $0 per trade for all ETFs

Bonds & CDs

  • $1 per bond or CD in secondary trading and free for US Treasuries traded online

Mutual funds

  • Several Zero expense ratio index Fidelity mutual funds available
  • No minimums to invest 
  • $49.95 per purchase on non-Fidelity funds

Let's look at the Fidelity price structure in comparison to the competition:

Header


Fidelity

Interactive Brokers


Charles Schwab

US Stock

$0.0

$1.0

$0.0

UK Stock

$10.8

$7.2

-

German Stock

$20.9

$4.4

-

Mutual fund

$37.5

$15.0

$24.8

US Treasury Bond

$0.0

$5.0

$0.0

US Stock Index Options

$6.5

$7.0

$6.5

How Fidelity makes money 

If “everything” is free, how does Fidelity make money then? There are ways and they include interest for cash, stock loan programs (loaning stocks for short sales) and portfolio margining. The latter means that some Fidelity clients who qualify can lower the amount of margin needed based on the overall risk calculated.

Non-trading fees

All the above are trading fees; most brokers also charge non-trading fees. The good news is that Fidelity’s non-trading fees are also relatively low or even non-existent. 

There are no fees for:

  • deposits
  • withdrawals
  • account
  • inactivity
  • account closure or transfer
  • exercise/assignment
  • sending and receiving wires in USD
  • sending checks
  • paper statements
  • trade confirmations

Non-USD wire withdrawals cost 3 percent of the amount you withdraw. 

There is also a currency conversion fee if you trade an international stock. The currency conversion fee depends on the amount you trade and it ranges from 0-1%. 

Header


Fidelity

Interactive Brokers


Charles Schwab

Account Fee

No

No

No

Inactivity Fee

No

Yes

No

Deposit Fee

$0

$0

$0

Withdrawal Fee

$0

$0

$0

2. Account Opening 

The account opening at Fidelity is fast and straightforward. The downside is that it isn't fully digital. 

Good:

  • No Minimum Deposit
  • Low Minimum Deposit
  • User-Friendly

Bad:

  • Not Fully Digital


Account registration with Fidelity is easy and it takes only a couple of minutes. In most cases the process is digital, but not everywhere. For instance, you have to mail or fax the account opening form and the photocopy of the relevant ID card to Fidelity. It can take up to three days to open a fully functioning account.

Here are the steps to open an account:

  • Select the account type
  • Add personal information
  • Select your investment/trading preferences
  • Review your information
  • Acknowledge the terms and conditions
  • Print and mail/fax the application

Account types

Fidelity offers dozens of different accounts, depending on how you plan to use the account. There are four categories:

  • retirement
  • education
  • general investing, trading, or saving
  • charitable giving

We looked at general investing and trading more in detail. Here you’ll find the following account options:

Account Type

Description

Brokerage Individual Account

Account is owned and used by a single individual

Brokerage Joint Account

Account is owned and used by two or more individuals

Business Accounts

Account is owned and used by a legal entity

Estate/ Trust Account

Account is held by a Trustee (separate legal entity) for your benefit

Roth / Traditional / Rollover IRA Accounts

Individual retirement accounts

Education Savings Account

Account is for educational purpose savings

Charitable Account

Tax-efficient account for a charitable giving

Medical Savings Accounts

Account is for healthcare purpose savings

Fidelity Managed Accounts

Accounts managed by Fidelity's technology and professionals Robo-advisor accounts managed by Fidelity

Minimum Deposit

The standard minimum deposit at Fidelity is $0, but it can be more if you opt for investing in portfolios or you trade on margin. Here is the breakdown:

Trading Preferences

Minimum Deposit

Basic Accounts Trading

$0

Margin Account*

$2.000

Day Trading**

$25.000

Fidelity Managed Accounts

$10 - 500.000

3. Withdrawals And Deposits 

Fidelity offers several base currencies in its portfolio. Note that debit/credit cards are not accepted. 

Good:

  • No Withdrawal Fee
  • No Deposit Fee
  • Various Account Base Currencies

Bad:

  • Debit/ Credit Card Not Available
  • Outgoing Wire Transfers are $10


Deposits

Fidelity offers several ways to deposit money into your Fidelity account. Deposits are possible in 16 base currencies, including USD, EUR GBP, AUD, DEN JPY and CHF.

Investors can make deposits, which are free, via a check, electronic (ACH), wire transfers and PayPal.

Please note, and this is important, that credit/debit cards are not available for deposits.

Header


Fidelity

Interactive Brokers


Charles Schwab

Total Base Curencies

16

19

1

Withdrawals

Withdrawals are also free of charge, but only for ACH and wire transfers in USD. There is a 3-percent fee on withdrawals in non-USD currencies.

Again, withdrawals via debit/cards are not possible at the time of writing.

4. Trading Platforms 

Fidelity platforms (web, desktop, mobile) are, generally speaking, user-friendly and easy-to-use. 

Good:

  • User-Friendly
  • Clear Fee Report
  • Two-Step Authentication

Bad:

  • Limited Customization (workspace, charts) 
  • Glitches here and then


Fidelity offers three trading platforms: web, mobile and desktop. They all include their versions of news feeds, alerts, notifications, and options to place orders. Fidelity platforms are only available in English.

Let's now look at each of the platforms more in detail:

Desktop

For active traders, Active Trader Pro is Fidelity’s flagship desktop platform. It is easy to use (the design is a bit outdated, though) and loaded with trading tools. Here are just some of them:

  • Website watch lists with streaming quotes and 48 total columns of data
  • Charting is cleanly laid out and includes 22 different drawing tools, 166 optional studies, custom user profiles, chart trading, alerts, notes, and more.
  • Active Trading features include several in-house brewed tools, including Real-Time Analytics (streaming trade signals) and Trade Armor (real-time position analysis).

Mobile

Mobile trading platform is available both for iOS and Android. It is friendly to use and it feels more up-to-date than the web or desktop trading platforms.

The app allows you to trade stocks, ETFs, options, and mutual funds but not fixed income. Fidelity has enabled fractional share trading on its mobile apps; customers specify dollars rather than shares when entering an order.

We found the mobile offering comprehensive, with nearly as extensive feature list as desktop. Workflow is fully functional. 

Web

Fidelity's web platform is made in-house. We found it relatively easy-to-use and well made.

Traders can set trailing stops and conditional orders ahead of time to help manage risk and maximize profits. They are also able to monitor, trade, and manage up to 50 stocks as a single entity using basket trading.

Advanced account features including margin, short selling, and options trading.

Qualified customers can take advantage of their active trading software to get streaming quotes, directed trading, and more.

The search functions are decent. You can search by typing both a company's name or its ticker. Searching for company names gives relevant results.

We also found the portfolio and fee reports clear and neat. To access them, go to the 'Accounts & Trade' section and search for 'Account Positions'.

5. Markets And Products 

Fidelity has several asset classes, including options, stocks, and international stocks, but no futures or forex. 

Fidelity clients can trade a wide range of assets available on the web and desktop platform. Equities (including fractional shares), options and mutual funds can be traded on the mobile apps.

Note that Fidelity does not offer futures, futures options, forex, or cryptocurrency trading.

Aside from that, investors can invest and trade with the following assets:

  • Stocks long and short 
  • OTCBB penny stocks
  • Mutual funds
  • Bonds corporate, municipal, treasury, CDs
  • Options single leg and multi-leg 
  • International 25 countries online)
  • Fractional shares on mobile apps

Fidelity clients can also trade IPOs, foreign ORDs and ADRs, Preferreds, Rights, Warrants, Treasury Inflation-Protected Securities (TIPS), Municipal Resets, High Yield Corporate Bonds, and Principal Protected Notes.

We made a comparison of Fidelity with two of its competitors. As you can see, Fidelity offering fares somewhere in the middle. 

Header


Fidelity

Interactive Brokers


Charles Schwab

Stock markets

22

78

4

ETF

80

13,000

2,300

Forex

No

Yes

No

Fund

560

257

600

Bond

113,000

1,472,900

60,000

Options

12

8

60,000

Futures

No

Yes

Yes

CFD

No

Yes

No

Cryptocurrency

No

Yes

No

6. Research 

Fidelity has useful research tools, such as in-depth fundamental data, screeners, and trading ideas. 

Good:

  • Reliable Interactive Chart
  • Trading Ideas
  • Asset Fundamentals Data

Bad:

  • None


Fidelity's research include flexible screeners for stocks, ETFs, mutual funds and fixed income, plus a variety of tools and calculators, including in-house market commentary. 

Technical analysis

Technical patterns and events are provided by Recognia, and social sentiment score by Social Market Analytics. You can see up to 40 years of historical price data, 30 days intraday data, extended hours data, and more than 60 fully customizable technical indicators.

Charting

Charting is more flexible and customizable on Active Trader Pro in comparison to the mobile app. Fidelity offers many chart styles, including point & figure. 

Fundamental Data 

Fundamental data is another thing we've liked. There is information for distinct assets, ranging from funds to stocks. You can look at peer group companies, dividend calendars, financial statements for previous years, and many more. 

Trade ideas

Fidelity’s stock, ETF, and mutual fund screeners are easy to use, rich in data, and set the benchmark for the industry.

News

The broker features numerous news sources, which can be sorted by holdings and watchlists and updates in real-time. The news sources include global markets as well as the U.S. market. 

Stock research

Fidelity provides 16 third-party research reports for stocks and five for ETFs, the largest set of reports of any broker. Note that no third-party research reports are offered for mutual funds.

Market commentary

Fidelity’s commentary can be accessed in the »Viewpoints« category. One example of their commentary pieces are Fidelity's annual sector outlook report that highlights key trends to watch and includes detailed sector analysis.

7. Customer Service 

Fidelity has excellent customer support through live chat, emails on phone. 

Good:

  • Phone Support
  • Live Chat
  • Fast Response Time

Bad:

  • None


Customer support is available through live chattelephone and email

This service is available 24/7 but only in English.

All the options are decent but we have noticed that the email responses were considerably slower (within 24 hours). 

8. Education 

Fidelity has a rich set of educational materials, including webinars, articles, and demo accounts. 

Good:

  • Demo Account
  • Tutorial For Trading Platforms
  • Educational Videos

Bad:

  • None


Fidelity organizes content into roadmaps with progress tracking. It is also sorted by experience level, category, and content type.

Investors can access Articles, videos, webinars, infographics, and courses. Altogether, their Online Learning Center contains more than 600 pieces of content in areas including options, fixed income, fundamental and technical analysis, and retirement. We noticed that Fidelity especially stands out with its retirement education.

Fidelity also offers weekly online coaching sessions, where clients can attend a small group online educational session to have in-depth discussions around the topics of options and technical analysis.

And the best thing is that everyone can find something for themselves - either you’re a beginner or an experienced trader.

FAQ section is also comprehensive and useful, with a wide range of data, accessible through an excellent search tool.

9. Safety 


Fidelity has top-tier licenses from regulators like the FINRA and the SEC.

Good:

  • Top-Tier Licenses
  • High Level Of Investor Protection
  • Additional Coverage By Fidelity

Bad:

  • No Negative Balance Protection
  • No Banking License
  • Not Listed On Stock Exchange


Fidelity has top-tier licenses from the Financial Industry Regulatory Authority (FINRA) and the Securities and Exchange Commission (SEC). 

In terms of the account protection, US clients can benefit from the US Investor Protection scheme or SIPC. The SIPC protection scheme offers protection for securities and cash loss in case the broker collapses. It comes with protection limited to $500,000, and it features a $250,000 limit for cash. This sum is higher than most investor protection schemes. 

SIPC does not offer protection for all investments. Generally, SIPC protects stocks, bonds, notes, mutual funds, registered securities, and other investment company shares. It does not apply to instruments (like unregistered limited partnerships, unregistered investment contracts, fixed annuity contracts, and currency), interests (in gold and silver), or similar commodity options and commodity futures contracts. 

Frequently asked questions

Is Fidelity good for investing?

Fidelity is ranked as one of the best brokers out there; it's relatively easy to use, has all the necessary trading features and is safe & reliable. 

Is Fidelity a Safe Company to Invest With?

Fidelity is not a scam. In fact, it is one of the most reliable, fully regulated and trusted brokerage firms in US and globally.

Is Fidelity Good for Beginners?

Yes, we recommend Fidelity for beginners. The brokers has developed an extensive FAQ and educational hub where beginners can learn all the basics about investing and trading. 

How much does it cost to invest with Fidelity?

Fidelity, as many other online brokers, offers zero commission trading on US stocks. All their other fees are competitive, except fees on trading with mutual funds which are somewhat higher. 

What is the minimum investment for Fidelity?

There is no minimum amount required to open a Fidelity Go account. However, in order for us to invest your money according to the investment strategy you've chosen, your account balance must be at least $10.

Final Verdict 

As one of the leading US stockbrokers with top-tier licenses, Fidelity has fully earned our trust and referral.

Fidelity offers powerful research tools and features. The web trading platform is user-friendly, and it includes professional order types. Mobile app is one of the best out there in terms of the functionalities and general usefulness.

The available product catalogue is rich, and it covers most of the popular asset classes (we did miss forex and crypto options, though). We also liked that the products cover both the US market and the international stock exchange.

The brokers is appropriate for all types of users, either beginners or experienced traders. Those who want to conduct their own research are able to use a large set of resources provided. Buy-and-hold investors and frequent equity traders are especially well served. 

There are some downsides to Fidelity, however. The account is not fully digital, and the financing rates and mutual fund costs are high.

Derivatives traders, especially those who trade futures and futures options, are one of the few groups of investors who won’t find a home at Fidelity. There are still awkward transitions between certain features.

But all in all, Fidelity offers reliable web trading platforms, user-friendly design, excellent research tools, competitive cost structure, and is  is a safe choice for a majority of traders.

Compare Fidelity With Other Brokers

Methodology

The mission of Business24-7 is to provide comprehensive, unbiased ratings and reviews of online providers. User experience, the mobile experience, customer service, costs and fees, security, the quality of trade executions, the products available on their platforms are all part of our six-month evaluation of a providers’s platform. The rating scale was based on thousands of data points that have been weighted into the scoring system.

Providers were also required to fill out a multi-point survey regarding every aspect of their platform. In-person demonstrations and evaluations were provided by the majority of the online providers we reviewed.

Stefan Grasic, along with our team of industry experts, conducted our reviews and developed this testing methodology for ranking what form is used in online investing.

Business24-7 maintains high editorial standards and provides the best advice and recommendations. The products and companies that we review may compensate us when you click on the links on this website. Click below to find out more about our review process and methodology.

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