10/2019 KIPLINGER’S PERSONAL FINANCE 25combination of the three). Merrill
Edge, Schwab and WellsTrade provide
their own in-house lists of stock rec-
ommendations as well. Stocks in Mer-
rill Edge’s U.S. 1 and Endeavor lists, for
instance, are chosen by Bank of Amer-
ica Merrill Lynch research analysts.
ADVISORY SERVICES
Firstrade and TradeStation don’t offer
advisory services, and WellsTrade de-
clined to compete in this category. The
rest of the brokers surveyed offer some
form of advice to clients. Depending
on your investing preferences and ac-
count assets, you may find yourself fol-
lowing the lead of an algorithm-based
“robo” adviser, a real-life financial
planner (some certified financial plan-
ners, some not) or some combination
of the two.
Fidelity and Schwab sit at a virtual
tie atop the category, thanks to their
budget-friendly robo-advisory ser-
vices. Fidelity Go comes with a mini-
mum investment of just $10, by far the
lowest barrier to entry of the group
(though at $100 and $500, respec-
tively, Ally Invest’s and E*Trade’s ro-
bos are an option for most investors).
Fidelity Go’s 0.35% management fee
is the second-highest (Merrill Edge
charges non-Preferred Rewards cli-
ents 0.45%) but includes expense ra-
tios on the underlying funds that make
up the plan’s portfolios.
The $5,000 minimum for Schwab’s
robo service, Intelligent Portfolios,
ties with the offerings from Interac-
tive Brokers, Merrill Edge and TD
Ameritrade as the most expensive.
But once you’re in the door at Schwab,
things get cheap. Investors pay no
management fee, and expense ratios
on its portfolios are as low as 0.08%.
Schwab’s service offers 36 portfo-
lios, second to Interactive Brokers,
whose advisory arm, Interactive Advi-
sors, offers 75 choices. At Interactive,
investors can elect to be placed in an
asset allocation portfolio that is based
on their answers to a nine-question
survey, or they can choose from a
menu of portfolios created by invest-
ment pros at advisers such as State
Street Global Advisors and Legg Ma-
son. Management fees range from
0.08% to 1.5%, and the average portfo-
lio charges an expense ratio of 0.14%.
The robos at TD Ameritrade and
Merrill are worthy options, but they
got dinged in our ranking for requir-
ing slightly higher minimums and
charging a bit more in expenses than
their peers. Merrill, Ally and Interac-
tive Brokers lost points for lacking
some of the amenities expected by
high-net-worth clients, such as estate
planning. All but Ally will assign an
account representative to clients who
meet a certain asset threshold; Fidel-
ity, Schwab and TD Ameritrade offer
a CFP. You need $25,000 in assets to
access a CFP at Schwab, one-tenth of
the $250,000 required by Fidelity and
TD Ameritrade.USER EXPERIENCE
Online brokers strive to make interac-
tions seamless, with platforms that are
intuitive, transparent and informative.
With that in mind, our team of invest-
ing writers tested each of the brokers’
websites and mobile apps and rated
their experiences.
Merrill Edge scored top marks.
A makeover to the website last year
slashed the number of navigation links
from 149 to 75, effectively cutting in
half the clicks needed to browse the
site, says Merrill exec Cory Triolo.
Users can summon a trade ticket from
any page on the site and don’t have
to navigate away to execute a trade.
The platform’s various “story”
modes—applicable to stocks, mutual
funds, ETFs and client portfolios—ask
a series of questions essential to un-
derstanding the investment instru-
ment at hand, each time providing a
matter-of-fact answer along with edu-
cational content and actionable advice
tailored to the individual investor.
“We want to really guide you down
the path and make finding ideas easy,”
says Merrill’s Steve Lucas.
Investors will find a similar philoso-
phy at E*Trade, which scored highSmaller ShopsNot Ranked but
Worth Mentioning
Not every broker provides all of the ame-
nities that the firms in our rankings offer.
To qualify, a firm had to allow clients to
trade stocks, bonds, mutual funds and
exchange-traded funds; deliver at least a
modicum of investment advice; and offer
an array of investment tools and research
resources. The firms below don’t cover all
of those bases, but each serves a niche.
You won’t find everything at Robinhood,
for instance, but you will find a handsome,
easy-to-use platform that offers stock,
ETF and option trading commission-free.
Investors looking for free stock and ETF
trades can also find them at TradeZero,
though with some caveats: Shares must
be purchased in lots of at least 200 to
be commission-free and must be bought
using a limit order.
Investors just starting out may favor
investing apps such as Stash or Acorns.
Stash users fill out a short questionnaire
to determine their goals, investing
preferences and risk profile, then Stash
recommends ETFs and individual stocks
(allowing investors to purchase fractional
shares) that will help investors achieve
their goals. Both apps can round up pur-
chases on a linked spending account and
automatically invest the “spare change”
in an investing account. At Acorns, you’ll
be placed into one of five diversified ETF
portfolios based on your time horizon and
tolerance for risk.
At the other end of the spectrum, inves-
tors with proverbial PhDs in trading might
prefer a platform built for active traders.
Lightspeed Trading clients have to trade a
ton to qualify for the lowest commissions,
but they can get access to the type of au-
tomated, algorithmic trading favored by
hedge fund managers. Frequent traders
of stock options and futures may opt for
Tastyworks, which offers bargain prices
to buy and sell them.