2018 Capital One Investing review, fees & commissions, advantages & disadvantages, minimum requirements & promotional offers for opening a new online account.



UPDATE: Capital One Investing accounts will be transferred to Etrade by the end of 2018. See Etrade Review instead.


Rating: 

  • Stocks & ETFs: $6.95
  • Options: $6.95 + $0.75 per contract
  • Mutual Funds: $19.95

Capital One Investing Review

Capital One Investing is a subsidiary company of Capital One, which has provided a wide selection of financial products and investing services since 1988. Capital One is one of the largest financial institutions in the country with over 45 million customers in the U.S., the UK and Canada. Capital One merged its self-directed brokerage services (formerly known as Sharebuilder) and advised services, establishing Capital One Investing. Today, Capital One Investing is a full-service brokerage with a wide range of investment services of a discount and traditional brokerage.

In the beginning of 2018 Capital One sold its brokerage business to Etrade Securities. The deal is set to finalize in the third quarter. All Capital One Investing accounts will be transferred to Etrade Securities before the end of the year.

Capital One Investing Trading Commissions And Fees

Capital One Investing keeps the fee structure transparent and easy to understand. Investors are never charged a monthly or annual maintenance fee, an inactivity fee or other hidden fees that some brokerages tend to sneak into their customers' statements. Generally, investors only get charged if they make a trade.

The fee to buy or sell a stock or exchange-traded fund (ETF) is $6.95. Capital One used to be less expensive firm compared to the well-known brokers. But now its commissions are the same or higher than at competitors: Etrade ($6.95), TD Ameritrade ($6.95), Fidelity Investments ($4.95), and Charles Schwab ($4.95).

Automatic investment is a great option for stock, ETF and mutual fund investing offered by Capital One brokerage. The commission is only $3.95 per security. Investors can choose a dollar amount they want to invest each time, securities they want to invest in and the reoccurrence of investments on a weekly, biweekly, monthly schedule or even only when funds are available. Orders are executed on Tuesday mornings, so clients must schedule them before 4:30 PM EST on Monday.

Options cost is $6.95 plus $0.75 per contract. However, Capital One Investing does not support complex and multi-leg options and offers very few option tools.

Mutual fund trades at Capital One Investing cost $19.95. There are over 1,000 mutual funds available through Capital One Investing. In comparison, some brokers, such as Ally Invest charge only $9.95 to buy or sell a mutual fund, and offer greater selections of funds.

Phone trades at Capital One Investing are $19.95 and are only available during business hours.

The broker is not offering commission-free ETFs that many competitors offer to their customers.

Overall, the fee structure at Capital One Investing is fairly transparent. However, there are a few fees hidden in fine print. For instance, the broker will charge $49.95 if you hold a no-load mutual fund for less than 90 days, and there is a $0.007 per share surcharge if the current stock price is less than $1.

 

Capital One Investing PortfolioBuilder Tool

The Portfolio Builder is an investment strategy tool, which in three easy steps allows investors to create a diversified portfolio of ETFs based on specified criteria, such as a dollar amount they would like to invest, investment style and asset allocation model that fits the customers' investment objectives and financial situation.

Investors can create a portfolio of 6-8 exchange-traded funds (ETFs) using asset allocation models. An entire portfolio can be purchased for one flat commission of $18.95. The same fee applies to selling out of the entire portfolio.

Capital One Investment Review

The PortfolioBuilder's design, as well as the overall look of the website, is clean, pleasant and very easy to understand.

 

Capital One Investing Trading Experience Review

Trading on Capital One Investing is very easy. Doing it within IRA account has virtually no differences compared to trading in a regular brokerage account. Several accounts can also be managed from the same console with a flick of a drop-down menu.

The Share Calculator can be a very handy tool when buying investments, especially for computing how many shares can be purchased with an available cash amount based on the commission and current market price.

Cash is transferred instantly to an investor's account if there is a Capital One or Capital One 360 checking and/or savings account linked to it. External accounts need a few business days for contributions to clear. Those who want to trade immediately might choose to pay a $6.95 Express Funding fee.

Capital One Investment review
Mobile apps are available for iPhones, iPads and Android devices. Mobile apps provide a set of trading and research tools, allowing customers to stay informed, fund accounts and make trades on the go.

Capital One Investing Investment Options Review

Capital One has a limited selection of investments to choose from. There is a modest sampling of index funds, blue chips and mutual funds with low minimum investment requirements, which are perfect for novice investors. There are also plenty of diversified and high-risk funds to please the more sophisticated investors.

Bonds and CDs cannot be bought through Capital One brokerage. This is of concern for conservative investors and those nearing retirement age. The closest you can get are bond mutual funds and ETFs that invest mostly in CDs and T-bills.


Capital One Investing Retirement Investing (IRAs) Review

Capital One Investing offers traditional and Roth IRAs that can be managed entirely online. Overall, Capital One IRAs present great value for the money and are user-friendly and easy to establish.

Capital One Investing IRA accounts are fee-free, but a steep $75 fee will be charged if you choose to transfer full account to another firm. Partial account transfers cost $15 per security with $75 maximum, which is also fairly expensive.

When making contributions to an IRA, investors can clearly see which tax year is selected and how much more they can legally contribute for that year. They also get automated emails congratulating them when they are close to hitting the contribution cap, so they do not accidentally get penalized for putting too much money in.


Investment Research

Capital One does provide a good tool to research investments, and it also showcases fund picks based on historical performance, dividend yield, market cap, and other criteria. A snapshot of any investment offered for sale can be accessed just by clicking on the ticker symbol anywhere on the website.

Capital One Investment Review

 

Capital One Investing Advantages

  • Low cost automatic investments
  • No-fee IRAs
  • No minimum requirement to open an account
  • Cost-effective investment strategy tool PortfolioBuilder
  • Free dividend reinvestment plans
  • Convenience of online banking through Capital One bank
  • Well-designed and easy to master tools
  • Great customer support

 

Capital One Investing Disadvantages

  • Very basic trading tools
  • Short selling is not allowed
  • No after hours trading
  • Limited investment choices
  • A $0.007/share purchase surcharge on stocks under $1

 

Capital One Investing Review Summary

Capital One Investing is committed to making the investing process as transparent and easy to understand as it can be for its customers without making them dedicate their time to charts, expertise and analysis.

The broker's top-rated competitors, such as Ally Invest, and TD Ameritrade, offer a wide variety of services, better research and educational tools, which can become a great start for new investors. The broker's basic tools and slow executions won't satisfy more sophisticated investors and active traders either. They might want to make more research or choose a firm among today's top 10 investment companies.

Those people who are looking for simplicity and more inclined to a passive investment style will find Capital One brokerage a very pleasant and satisfying experience. Capital One bank customers can benefit a bit more from the extra simplicity and ease of use of the broker.

 

Capital One Investing Commissions and Fees

InvestmentsPrice
Stocks and ETFs$6.95
Stocks and ETFs phone trades$19.95
Options$6.95 per online trade + $0.75 per contract
Mutual funds$19.95
Automatic Investments (stocks, mutual funds and ETFs)$3.95

 

Capital One Brokerage IRA & Account Fees

FeeAmount
IRA Setup Fee$0
Annual IRA Fee$0
IRA Termination Fee$0
Full Account Transfer Out$75
Partial Account Transfer Out$15.00 per security ($75.00 maximum)
Outgoing Wire Fees$30
Account Closing Fee$0

Continue Reading


Capital One Investing reviewed by TopRatedFirms.com Rating: 3