Ally Invest versus Charles Schwab - compare IRA, commissions, investing fees, trading tools, account differences, pros and cons. Which discount stock broker is better?

Two Rivals

Ally Invest and Charles Schwab provide a lot of investment services, and somehow they manage to do it at reasonable cost. So which broker is the better choice? Let’s try to find out.


Charles Schwab Review
Rating Ally Invest rating Charles Schwab rating
Stocks, ETFs $0 $0
Options (per contract) $0.50 $0.65
Mutual Funds $9.95 buy and sell $49.95 buy and $0 sell
Initial Funding Requirement $0 $1,000
Inactivity Fee $0 $0
IRA Annual Fee $0 $0
IRA Termination Fee $25 $0
Outgoing Wire Fees (Domestic)$30$25**
Full Account Transfer Out$50$50
Partial Account Transfer Out$50$25
Open an account Up to $3,000 cash bonus + $0 trades + transfer fee rebate. Open Schwab account and get $0-fee stock trades.

As you see from the table above, Ally Invest is better priced than Charles Schwab.

Range of Investment Types

Traders at Ally Invest can buy and sell equities, options, ETF’s, closed-end funds, mutual funds, fixed-income securities, options, and forex. While Ally Invest used to offer futures trading, it has retired the service. Penny stocks and over-the-counter securities are on tap, however.

Schwab offers the same investment choices as Ally Invest except currencies. Unlike Ally, Schwab has futures. Schwab also offers a global account where international trades can be placed on foreign exchanges. These foreign trades are denominated in the currencies of the exchanges the securities trade on. Some of the available markets include Hong Kong, Canada, Norway, Australia, and Japan.

Trading Software

Availability of investments is not enough. A broker-dealer must deliver adequate software to manage and trade them. At Ally Invest, a well-designed website is capable of investment research, education, and trading. A sophisticated trade bar sits at the bottom of the screen. It offers several order types and two duration choices.

A more advanced system can be found on Ally Invest LIVE, the company’s browser platform. There’s a link to it in the top menu. It offers option chains, a nice market clock, stock quotes, market indexes, and more. Charting on the platform comes with technical studies, multiple display styles, and many drawing tools.

Ally Live

While there is no desktop platform at Ally for securities trading, there is a desktop platform for currency trading. During our research, we were impressed by its charting capability, automated trading, and customization.

Moving on to Schwab, we find a much better website with more materials and security research. There’s a trade bar, although it’s less advanced than Ally’s. Trades can’t be placed on it, for example. Schwab’s website order form is sufficient, however, with more duration choices than Ally offers.

Like Ally Invest, Schwab has a browser platform. Called StreetSmart Central, it has a very good trade ticket that is able to submit orders for securities and futures. Not to be missed is the software’s charting program that offers tick-by-tick price action.

Finally is Schwab’s most advanced trading platform: StreetSmart Edge. This software is launched from the desktop. It offers a lot of great features, including multi-leg option plays, Level 2 quotes, and direct-access routing (which Ally Invest does not offer). The platform’s charting program is very customizable (more so than Ally Invest LIVE). There are many charting tools, including comparisons and technical studies.

StreetSmart Edge

Schwab has a skill for Amazon Echo and Echo Show. It is able to deliver stock quotes and market updates. Ally Invest hasn’t yet followed suit.

Mobile Apps

Schwab’s mobile app comes with live streaming of CNBC financial news. Even better, the brokerage house charges nothing for this great service. We also found mobile check deposit, bill pay, and funds transfer.

Ameritrade vs Schwab

The order ticket has a few durations and order types. Overall, it’s pretty basic, but is sufficient for most activities. As for charting, there are technical studies and company events. Furthermore, a chart can be rotated horizontally. Besides stocks and ETF’s, Schwab’s app offers the ability to trade derivatives and mutual funds.

Another prominent feature on the Schwab app is market news. We found articles from MT Newswires, market updates in audio format from Schwab, sector performances, volatility ratings, and the day’s market movers.

Compared to Schwab’s app, Ally Invest offers many of the same features. During our investigation, we found check deposit, Zelle transfers, bill pay, and ACH transfers. Because the brokerage app is part of the bank’s app, there are tools for bank accounts as well.

Ally vs Schwab

As for the investment side, there are multiple order types and durations. Charting is decent with a few technical studies, comparisons, and four chart styles. A graph can be rotated horizontally.

Other highlights on Ally’s Invest’s app include a watch list and option chains. Although options can be traded on the platform, mutual funds cannot. This is one area where it underperforms Schwab’s app. Both apps come with Touch ID to make logging in quicker and easier.

One final note in this category is a forex app from Ally Invest. It functions on both Android and Apple devices and provides both charting and trading.

Cash Management

Schwab has both brokerage and banking businesses. Its bank provides checking and savings accounts, and these can be linked to an investment account. The checking option comes with a debit card and checks. Schwab lavishly provides unlimited ATM fee refunds, and this policy extends to any cash machine anywhere in the world.

Ally Invest customers can add checks and a debit card to an existing brokerage account if they meet minimum balance requirements. Otherwise, Ally Bank offers checking and savings accounts that can be easily linked to a securities account. A money market account from Ally Bank comes with ATM refunds up to $10 per month.

Customer Service

Both brokerage houses in this survey provide customer support around the clock. They both have online chat as well, but we have found some weaknesses. For example, during a test chat with Ally, it took us 16 minutes to reach an agent. During a test chat with Schwab, we received an incorrect answer. For in-person service, Schwab has a large network of branch locations, while Ally Invest has none.


Ally Invest: Up to $3,000 cash bonus + $0 trades + transfer fee rebate.

Charles Schwab: Open Schwab account and get $0-fee stock trades.

Mutual Funds and ETF’s

Using our Ally Invest test account, we found 11,907 securities available for purchase. Out of these, 2,247 come with no load. The brokerage firm does not offer any mutual funds that are both no-load and no-transaction-fee.

Schwab offers fewer mutual funds, but more than twice as many funds with zero load. Moreover, Schwab offers 3,405 funds with no load and no transaction fee.

Moving to exchange-traded funds, we find that both brokers offer them free to trade.

For fund research, Schwab’s website has much more extensive information, including select lists of pre-screened funds, more in-depth fund research, and fund ratings from multiple sources.

Retirement and IRA’s

Both Schwab and Ally Invest offer Individual Retirement Accounts. Besides Roth and Traditional versions, Schwab customers can open Custodial, Inherited, and Rollover varieties. Schwab also offers trust, estate, and charitable accounts. For small businesses and the self-employed, Schwab provides SIMPLE and SEP accounts, a solo 401(k) plan, and a personal defined benefit plan.

Ally Invest offers the same IRA’s as Schwab except for the SEP, SIMPLE, Custodial, and Inherited types. A SEP IRA can be opened at Ally Invest’s affiliate Ally Bank. Ally Invest does offer trust accounts, but not estate or charitable accounts. There is no individual 401(k) plan and no personal defined benefit plan, either.

Ally Invest vs Charles Schwab Summary

Both brokerage houses are excellent and are sure to please most customers. Ally Invest is better priced, especially for mutual fund investors and options traders, and offers much better promotion for new accounts.

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