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Fidelity Investments Review
Fidelity Investments at a glance
|Account Min.||Stocks & ETFs||Bonds||Mutual Funds||Key Benefit|
|Fidelity Investments||$0||$0 per trade||$0 on new issues; $1 per secondary issue||$0 for Fidelity Funds, $0 on purchase for NTF funds, $0 on redemption||Low commission and fees|
What we like about Fidelity Investments
Fidelity Investments has some of the lowest fees in the financial services industry. It offers free trades on stocks, ETFs, new issue bonds and Fidelity Funds. A fee structure this good is hard to find, so if you’re looking for an affordable broker, Fidelity is one of your best options.
Despite the low costs, Fidelity doesn’t skimp on resources, research and other features. The company has tons of educational content for new investors, independent research from over 20 different providers and lots of tools to make investing easier for both beginner and advanced investors.
You can also make international trades in 25 different countries through the online trading platform or can head to a local branch to get face-to-face investment advice.
“I recommend investors look for a discount brokerage with a long track record of providing quality low-cost mutual funds and ETFs and very low trading costs,” advises Jay Abolafia, Ph.D., CFP® of Lyon Financial Planning. He adds, “I typically recommend Vanguard, Fidelity or Schwab since all have a strong track record and compete fiercely on management costs.”
Things to consider
Although Fidelity has lots of tools and features that active investors will appreciate, it doesn’t offer futures trading, which will be a drawback for some users. If futures trading is an important part of your investment strategy, you may want to choose a broker that offers it, such as Charles Schwab or TD Ameritrade.
Another drawback of going with this company is that there’s no bonus for opening up a new account. Other brokerages offer pretty substantial bonuses, so you could be missing out on hundreds or even thousands of dollars.
Stock and ETF trading
Active traders will love Fidelity’s trading platform. It offers free stock trades, access to international markets and advanced tools like Active Trader Pro that will help you make better trading decisions. Active Trader Pro gives you notifications whenever a stock reaches a new high or low to help you spot great opportunities and gives you updates on earnings announcements and news related to your positions.
If individual stocks aren’t your thing, Fidelity also offers more than 2,000 ETFs on its platform, plus tools to help you find the best ones for you. The ETF screener tool is available on both desktop and mobile and has over 100 different criteria that will narrow down your search.
Fidelity Investments offers more than 50,000 bonds and CDs to help you build a diversified portfolio. The trading platform allows you to buy and sell both new issue and secondary market bonds with minimal fees. Buying new issue bonds is completely free, and buying secondary issue bonds will cost you a $1 flat fee.
If you’re new to bond trading and need some guidance, Fidelity offers a variety of tools to help you out, such as the bond ladder tool and auto roll program. The bond ladder tool teaches you how to stagger your bonds to create a steady stream of income over time. It provides you with educational content to help you build your bond ladder and suggests bonds for you based on your financial goals.
The auto roll program is equally useful. It automatically reinvests your U.S. Treasury and CD investments when they reach maturity so you don’t need to remember to do it.
Options and futures trading
While Fidelity doesn’t charge a base commission, trading options do cost $0.65 per contract. That’s a competitive price, and if you use the Options Trade Builder, placing a trade couldn’t be easier. The tool allows you to finalize your trade in just three simple steps and gives you vital information about the benefits and risks of the options you’ve selected.
Fidelity’s options tools are great, which almost makes up for the fact that you can’t trade futures. If you’re a passive, buy-and-hold type of investor, this likely won’t bother you. But again, active investors who enjoy trading futures may want to go with other brokers who offer them.
Fidelity’s trading platform gets top marks for ease of use.
The website has lots of drop-down bars that make it easy to find what you’re looking for, whether it’s market research or information about your orders. It’s also easy to switch back and forth between performing research and placing trades because the trading ticket is easily accessible from anywhere on the website. And if you do have trouble using any of the website’s tools or features, you can watch a video tutorial from Fidelity to get some extra help.
Fidelity has one of the best mobile apps of any financial service provider. Whether you have an Android or Apple device, this app allows you to make trades completely on the go. It has all the same market research reports and data as the desktop platform, enabling you to make sound investing decisions no matter where you are.
In addition to market research, this app has lots of unique features to create an enhanced user experience. It has a customizable dashboard featuring news and content, a notebook that allows you to write down investing ideas and a podcast streaming feature. It’s also compatible with the Apple Watch, so you can get push alerts and real-time market data right on your wrist.
Research and resources
If you want comprehensive market research reports to guide your investing decisions, then Fidelity is the brokerage to go with. It provides stock research from 19 different providers, including Thomson Reuters and Ned Davis. It also gives each stock an equity summary score, which is a number from zero to 10 that gives you an idea of how bullish or bearish a particular stock is. Equity summary scores are based on consolidated data from several market research providers, so they’ll give you a pretty good picture of how each stock is performing.
In addition to stock data, Fidelity also provides ETF research from six providers to help you choose the best-performing funds and educational resources for new investors. The company’s website has a dedicated learning center complete with articles, webinars, and videos to help you learn about important investing topics and make the most of your brokerage account.