Merrill Edge Review: Many Options for Many Types of Investors

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Charles Schwab Bank
4.8
SCORE
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Quick Take: If you like online trading and want to invest on your own terms, Merrill Edge makes it easy. You can take advantage of resources and tools to help you reach your financial goals and choose from different types of investment products, from stocks and bonds to options and ETFs. With the platform's user-friendly online investing and trading processes, you can easily build a balanced portfolio.
  • Fees
    4.7
  • Trading Platform
    4.8
  • Customer Service
    4.8
  • Mobile Experience
    4.9
How did we calculate this?

Pros

  • No minimum initial investment for simple, online investment and trading with Merrill Edge Self-Directed account
  • $0 online stock and ETF trades
  • Combined Merrill Edge investment and Bank of America deposit account balances can be used to qualify for Preferred Rewards program

Cons

  • Does not support fractional share trading
  • Does not offer forex or futures trading

Merrill Edge Overview

Merrill Edge is the online investment platform affiliated with Bank of America. Although the combination of Bank of America and Merrill Edge provides enhanced services, the combination of a traditional bank with a brokerage firm is the ultimate cross-selling opportunity for the combined entity. In other words, the Merrill Edge platform as a whole is designed to make it as easy as possible for you to open a Bank of America banking relationship and transfer money back and forth between the two sides of the firm. For fans of both Bank of America and Merrill, the convenience this offers is a plus. If you’d rather keep your bank’s nose out of your investment portfolio and vice versa, this could be more problematic for you.

Self-directed investors can use the Merrill Edge online brokerage platform to trade stocks, bonds, ETFs, mutual funds, options contracts and more. As an online broker, commissions and fees are much lower at Merrill Edge than on the full-service side of the firm, but Merrill Edge still provides access to research and financial counselors, if needed. 

Key Features

Here’s a look at some of the features you should consider to help you decide whether Merrill Edge is right for you.

Fees

The Merrill Edge Self-Directed account offers $0 online stock and ETF trades. It also offers $0 online option trades, but there is a fee of $0.65 per contract for options. Those fees jump to $29.95 for stock and ETF trades and $29.95 plus $0.65 per contract for options trades if you use a representative to place your trades.

There are no commissions on most mutual funds unless they’re no load, transaction-fee funds, which cost $19.95 per transaction or $29.95 for every broker-assisted transaction.

Joining the Bank of America Preferred Rewards program may be advisable if you plan on seeking guided investing. You can receive a discount of 0.05% or higher on the annual fee as long as you maintain a combined balance of $20,000 or more over three months.

Trading Platform

The beauty of the Merrill Edge website is that it can be as simple or as complicated as individual investors desire. If you’re a beginner — or just not that interested in having advanced trading capabilities — you’ll likely be perfectly content with the standard Merrill Edge interface, which is very intuitive and provides user-friendly graphical representations to help you build a portfolio matching your desired risk and return characteristics.

Advanced traders will enjoy the Merrill Edge MarketPro trading platform, which provides interactive charting, technical analysis studies and Nasdaq Level II quotes.

Merrill Edge routes orders through an execution system designed to get you the best possible price for your order. The order processing system is electronic and automatically sends your order to the appropriate execution center based on the characteristics of your order, trading statistics and market data.

Customer Service

Merrill Edge gets high marks for its customer service. In addition to 24/7 live phone service, you can get help via email, online chat or in a Bank of America branch.

Mobile Experience

You can access your Merrill Edge account on the go at any time with both Android and iOS mobile apps. Features of the apps include interactive charts and so-called “heat maps,” which show the relative outperformance and underperformance of different market areas. You can initiate trades from either app, and you can also get quotes, news and market data. If your phone is enabled for the technology, you can also log in to your app with your fingerprint.

Comparable Options

Here’s a look at how Merrill Edge compares to other options you might consider.

Merrill Edge vs. Charles Schwab

Like Merrill Edge, Charles Schwab doesn’t charge commissions on online stock and ETF trades, but it does charge $0.65 for options contracts with no online commission. Charles Schwab edges out Merrill Edge for broker-assisted transactions, charging a $25 service charge when applicable, compared to the $29.95 service charge that typically applies with Merrill Edge. One big difference for newer or small investors is Charles Schwab’s allowance of fractional share trading, which Merrill does not support.

Merrill Edge vs. Fidelity

When comparing two brokerages with no fees on many trades, it’s important to look at the hidden fees. Fidelity’s broker-assisted stock, ETF and option trades are $32.95 compared to Merrill Edge’s $29.95 service charge. The big one is the mutual fund fee, which is at least $19.95 for no load, transaction-fee funds with Merrill Edge and $49.95 or more with Fidelity if you select non-Fidelity transaction-fee funds.

How To Open an Account

Opening a brokerage account with Merrill Edge is a simple process if you choose to apply online. There is no minimum account balance requirement with Merrill Edge Self-Directed — you can fund at a later time. You’ll need to provide your personal information, including your name, address, occupation and date of birth. Have your government-issued photo ID as well as your Social Security number ready to complete the application.

Who Merrill Edge Is Best For

Merrill Edge is best for anyone who wants commission-free trading and great customer service. Bank of America customers are also good candidates because Merrill Edge offers seamless integration with the bank. 

Although the platform appears to be extremely intuitive and geared toward beginners, more advanced traders could also find what they need, including plenty of charting and research options. 

The Merrill Edge user interface is very customizable. Basic traders can choose from different performance tracking tools to present investment information in the most digestible format. The more advanced MarketPro platform allows traders to create a customized account view that only shows selected information. You can drag or drop windows into your custom view or rearrange the information on the page at any time.

Final Take

The average customer seeking a complete banking relationship with the benefits of an online brokerage account will find a good home with Merrill Edge, which is without doubt one of the best online brokers. Investors with niche needs or those who have smaller account balances and could benefit from fractional trading might be able to find better options elsewhere.

FAQ

  • Does Merrill Edge have hidden fees?
    • Although Merrill Edge offers $0 online stock and ETF trades, there is a fee of $0.65 per contract on options. If you need assistance placing a trade, expect to pay $29.95 for stock and ETF trades and $29.95 plus $0.65 per contract for option trades. As for mutual funds, transaction-fee funds cost $19.95 per transaction or $29.95 when a broker executes the transaction on your behalf.
  • How much money do you need to open a Merrill Edge account?
    • Merrill Edge does not require an account minimum to open a Merrill Edge Self-Directed account. 
  • Which is better, Charles Schwab or Merrill Edge?
    • Whether Charles Schwab or Merrill Edge is a better option for you will depend on your needs as an investor. Charles Schwab's service charge for representative-assisted transactions is generally $4.95 cheaper than what Merrill Edge typically charges. Plus, Schwab allows for the purchase of fractional shares, making the platform more accessible to smaller traders than they'd find at Merrill Edge.

Cynthia Bowman contributed to the reporting for this article.

Information is accurate as of Oct. 17, 2022.

Editorial Note: This content is not provided by any entity covered in this article. Any opinions, analyses, reviews, ratings or recommendations expressed in this article are those of the author alone and have not been reviewed, approved or otherwise endorsed by any entity named in this article.

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About the Author

After earning a B.A. in English with a Specialization in Business from UCLA, John Csiszar worked in the financial services industry as a registered representative for 18 years. Along the way, Csiszar earned both Certified Financial Planner and Registered Investment Adviser designations, in addition to being licensed as a life agent, while working for both a major Wall Street wirehouse and for his own investment advisory firm. During his time as an advisor, Csiszar managed over $100 million in client assets while providing individualized investment plans for hundreds of clients.
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