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Fidelity Account Review: Brokerage Fees, IRA Investing, Pros and Cons, Mutual Fund Offerings

Fidelity Investment Account Review - Pricing

  • Stocks/ETFs: $4.95 per trade
  • Options: $4.95 + $0.65 per contract
  • Mutual Funds: $49.95 or $75 per buy transaction for no-load mutual funds; sell transactions are free if fund held over 60 days ($49.95 otherwise)

Fidelity Investments Important Fees and Surcharges

  • Extended hours surcharge: $0
  • Large order surcharge: $0
  • Penny stocks surcharge: $0
  • IRA setup fee: $0
  • Annual fees: $25 for Simple IRA; $0 for other accounts
  • Mutual fund low balance fee: $12 per year for each noncore Fidelity fund under $2,000
  • Short term redemption fee: $49.95 if mutual funds sold in less than 60 days

Fidelity Investments Advantages

  • No account maintenance or inactivity fees (except for Simple IRA)
  • Excellent customer service
  • Over 180 local branches
  • Free dividend reinvestments
  • Best selection of independent investment research
  • Access to foreign stock exchanges
  • 2% of Fidelity Rewards American Express card purchases can be deposited into the investment account

Fidelity Investments Disadvantages

  • Higher than average commissions on mutual funds
  • Advanced platform available only to clients making 36 or more trades a year
  • High minimum initial account deposit of $2,500 (cash and margin accounts)
  • For some funds there is $49.95 annual mutual fund low balance fee if fund balance is under $2,000

Fidelity Investments Account Types

  • Saving for Retirement
  • Rollover IRA
  • Roth IRA
  • Traditional IRA
  • Inherited IRA
  • Self-Employed 401(k)
  • 401(k) Plan for Large Business

  • Managed Accounts
  • Portfolio Advisory Services

  • Saving for Education
  • 529 Account
  • Custodial Account

  • Charitable Giving & Estate Planning
  • Fidelity® Charitable Gift Fund
  • Fidelity Private Foundation Services
  • Trust
  • Estate
  • Non-Trust Fiduciary

  • Annuities and Term Life Insurance
  • Tax Deferred Annuities
  • Income Annuities
  • Term Life Insurance

The Fidelity Account

Fidelity Investments offers traders a wide range of financial products, including stocks, bonds, options, IPO’s, ETF’s, mutual funds, CD’s, IRA’s, annuities, trusts, investment advice, banking services, and even life insurance.

Fidelity’s flagship account is aptly named the Fidelity Account. Here investors have access to a wide range of products and services and can link to other Fidelity accounts, such as retirement and cash management accounts.

The Fidelity Rewards American Express card can be linked to the Fidelity Account so that the credit card deposits 2% of purchases into the investment account.

Fidelity Fees and Account Minimums

The Fidelity Account has no minimum balance requirement and comes with zero monthly and annual account fees. Minimum to open most Fidelity accounts is somewhat high $2,500.

The firm’s charge for trading stocks and regular ETF’s is $4.95.

Fidelity offers over 10,000 mutual funds, many of which carry no load and no transaction fee. Furthermore, traders have access to 84 commission-free ETF’s, which cover a broad range of asset classes and investment strategies, including short-term and long-term strategies, and both debt and equity.

Cash Management

Fidelity Investments Review

To help their customers manage short-term cash needs, Fidelity created their Cash Management Account, which comes with checks, deposit slips, online images of all cleared checks, and a Visa Gold debit card, giving the account all the benefits of a traditional checking account, and actually more.

The account offers FDIC insurance up to $1,250,000. It does this by sweeping the cash balance into a maximum of 5 independent program banks, each offering the standard $250,000 protection.

Investment Research

Fidelity offers in-depth research for stocks, ETF’s, options, and mutual funds. Customers have access to free stock and ETF reports from Zacks, Morningstar, S&P Capital IQ, Thomson Reuters, and others.

Fidelity has a virtual learning center where investors will find videos, articles and webinars on a wide range of financial topics.

Customer Service

Fidelity can be contacted via an on-line chat system, phone, fax, or e-mail. The phone service is staffed 24 hours a day, 7 days a week, and the reps have a history of being trained and actually knowing what they’re talking about, which of course is a big plus. The chat service is on-line from 8:00 am to 10:00 pm EST. Fidelity also offers a lengthy list of phone numbers for customers traveling outside the U.S., from Albania to Zimbabwe and everywhere in between.


Investors who deposit $50,000 into an existing or new brokerage or IRA account are eligible to receive 100 commission-free trades for 90 days. $100,000+ deposit gets investor 200 free trades. This promo also includes free access to the Active Trader Pro platform.

Trading Tools

Fidelity Investments Review

Although Fidelity does offer trading by phone and with a live broker, the cheapest option is trading on-line. The web site is simple and straightforward to navigate. Customers who have multiple accounts will see all accounts upon a single log-in.

Transferring funds and paying bills are all simple and easy to do within the web browser.

Trading securities is trouble-free with Fidelity’s intuitive trade ticket or standard web browser platform. Fidelity also offers Active Trader Pro, an advanced trading platform for active traders.

Fidelity Investments Review

Fidelity Investments Review

Fidelity’s brokerage services cover a lot of territory and come at a reasonable cost. Add in Fidelity’s excellent customer service, and investors have a broker that’s not easy to beat.

The company offers actual brick-and-mortar branches for old school investors who want a little extra hand holding. A branch could come in handy for customers seeking retirement or investment advice, which the firm does offer. Some of Fidelity’s competitors, such as Firstrade and Optionshouse, don’t have local branches.

Fidelity’s range of offerings, including college savings plans, trusts, and estate planning, will appeal to customers who want a lifelong financial advisor. Many brokerage firms don’t offer the same range of products and services.

Access to Fidelity's flagship trading platform, Active Trader Pro, is only available to traders placing 36 or more trades in a 12 month period, a real turn off to investors who don’t trade as often.

Fidelity Investments Review Summary

Fidelity offers an extensive array of financial products and services at the reasonable cost to their customers, making this broker one of the top players in the industry.

Fidelity Promotion Offer

200 free trades for new and existing customers.

Fidelity Reviewed by on . Rating: 5
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