2019: Merrill Lynch and TD Ameritrade: compare IRA, commissions, investing fees, trading tools, account pros and cons. Which online broker is better?


Overview of TD Ameritrade and Merrill Edge

If you’re considering opening a brokerage account at TD Ameritrade or Merrill Edge, keep reading. We’re going to make a detailed comparison of these two firms and then make a recommendation.


Portfolio Management

If you don’t want the burden of making trading decisions in your investment account, you can turn over the reins to a financial professional at either firm. TD Ameritrade charges a very low 0.30% for its robot to buy and sell securities in your account. The broker-dealer requires $5,000 for this service. If you don’t trust such technology, TD Ameritrade also has human advisors who charge 75 to 125 basis points with a $25,000 minimum. Investing at least $250,000 will get you a personal financial advisor and lower fees.

Merrill Edge doesn’t offer a robo-advisory service. The broker-dealer does have traditional management services that start at a very low 0.45% with a $5,000 starting balance. If you want in-person financial advice, you can find it at a nearby Bank of America location. This route costs 0.85% with a $20,000 minimum.

The option to use a robot gives TD Ameritrade the nod here.


Pricing

Equity transactions at Merrill Edge are $6.95. The broker offers free trades to clients who have at least $20,000 on deposit within the Bank of America family. This includes Merrill Lynch, Merrill Edge, and Bank of America.

Although TD Ameritrade is associated with TD Bank, the broker does not offer any such discounts. Stock and ETF trades are $6.95 for all clients. Options at TD Ameritrade cost an additional 75¢, while Merrill Edge imposes the same charge.

Using a human agent over the phone rather than an on-line trading ticket to place a trade costs an extra $23 at Merrill Edge. TD Ameritrade clients must pay an additional $38.04 for the same service.

A trading account at either company carries zero on-going fees. Merrill Edge charges $49.95 to close a retirement account, while TD Ameritrade does not. There is no minimum deposit at either firm.

Currently, Merrill Edge charges 10.125% for a margin loan under $10,000, while TD Ameritrade is at 10% for the same amount.

TD Ameritrade seems like the better choice here, except for large Bank of America customers.


Ameritrade vs Merrill Lynch


Customer Support

TD Ameritrade customers can reach out to a company associate around the clock. Merrill Edge also has agents on the phone 24/7. We were disappointed in our testing to discover that neither company’s website has an on-line chat feature.

TD Ameritrade has a greater emphasis on foreign languages, as it has reps who speak Chinese and Spanish. TD Ameritrade also has a greater emphasis on serving customers in person as it manages a brick-and-mortar network throughout the United States. While Merrill Edge does have locations inside some Bank of America locations, these are only for clients who pay extra for financial advice.

The victory in this category goes to TD Ameritrade.


Mutual Funds and ETF’s

During our investigation, we found 3,368 mutual funds at Merrill Edge, and 791 of these had no transaction fee. Funds with a transaction fee cost $19.95 on both the buy and sell sides.

TD Ameritrade has a much higher mutual fund transaction fee ($49.99), although it delivers more funds (11,470 total). The broker also delivers more no-transaction-fee products (3,940).

On the ETF side, Merrill Edge provides zero funds that are commission-free. TD Ameritrade does a great job here, again, by providing more than 200 that are free to trade.

TD Ameritrade easily takes top honors here.


Merrill Lynch vs Ameritrade


Trading Tools

Both brokers offer desktop platforms. Merrill Edge imposes active trader requirements (5 trades per month or $50,000 in assets), while TD Ameritrade gives its software free to all customers. In fact, non-customers can trial the program.

One tool we especially liked at TD Ameritrade, which Merrill Edge does not offer, was a simple browser-based platform. This would be great for beginners who don’t want to use a more complicated desktop program.

Both websites are well-designed and can be used to submit orders. Both websites also have trade bars, which are very competitive with each other in terms of quality and usefulness.

TD Ameritrade seems to have the edge here.


Mobile Apps

Going from the old PC to the modern age where people expect to do things on-the-fly, TD Ameritrade and Merrill Edge both offer platforms for phones and tablets. In fact, a smartwatch app can be used at either broker as well.


Merryll Lynch vs Ameritrade


While trades can be placed on the Merrill app, the platform doesn’t provide live streaming of CNBC, which the TD Ameritrade app does have. Charting on the Merrill app isn’t nearly as good as on TD Ameritrade’s platform.


Ameritrade vs Merrill Lynch


Merrill Edge underperforms again.


Promotions

TD Ameritrade: Trade free for 60 days + get up to $600.

Merrill Edge: Get up to $600 when you open new Merrill Edge account with at least $20,000.



Banking Features

Merrill Edge customers can add checks and a Visa debit card to a brokerage account free of charge. This does not create a bank account. It remains an investment account with SIPC (not FDIC) insurance. TD Ameritrade has the same setup. It seems a little strange that neither one would offer a bank account considering that they are affiliated with large banks.

Merrill Edge offers unlimited ATM fee rebates from Bank of America machines and limited refunds from non-Bank of America machines. TD Ameritrade offers unlimited reimbursement nationwide.

Merrill Edge automatically links Bank of America accounts to a Merrill login, but TD Ameritrade does not link TD Bank products.

Overall, it’s pretty even here.


Recommendation

Merrill Edge would be the ideal choice for large traders or Bank of America customers who have at least $20,000. These funds can be in deposit accounts rather than in a Merrill trading account. TD Ameritrade would be the better option for frequent traders who need the most advanced technology because its desktop platform thinkorswim is more sophisticated than Merrill’s software.


Open TD Ameritrade Account


Open TD Ameritrade Account

Open Merrill Edge Account


Open Merrill Edge Account


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