Fidelity vs. Schwab Introduction
Before opening a brokerage account, it’s worth comparing Charles Schwab and Fidelity Investments. These two companies offer excellent services at very low costs.
Comparison Table
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| Rating |
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| Stocks |
$0 |
$0 |
| Options (per contract) |
$0.65 |
$0.65 |
| Mutual Funds |
$49.95 ($0 to sell) |
$49.99 ($0 to sell) |
| Initial Funding Requirement |
$0 |
$0 |
| Inactivity Fee |
$0 |
$0 |
| IRA Annual Fee |
$0 |
$0 |
| Account Closing Fee |
$0 |
$0 |
| Trading Experience & Technology |
|
|
| Mobile |
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| Research Amenities |
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| Portfolio & Analysis Reports |
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| Customer Service and Education |
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Promotions
Charles Schwab: Satisfaction guarantee and $0-fee trades at Charles Schwab.
Fidelity: None right now.
First Category: Investment Services
Both Fidelity and Schwab offer a wide variety of investment services for self-directed and advisory accounts. You can open various tax-advantaged accounts, such as custodial accounts, trusts, and retirement accounts, along with standard individual and joint taxable accounts.
Both brokers provide options, stocks (including international and OTC stocks), bonds, mutual funds, ETFs, annuities, and brokered CDs. Fidelity is unique in offering cryptocurrencies, while Schwab offers futures and forex. Both also provide life insurance.
Both firms have robo-advisory accounts for automated ETF investing. Schwab’s service is free, but Fidelity’s is free only up to $25,000. Schwab has a $5,000 minimum requirement, while Fidelity has no minimum.
Winner: Pretty close overall
Second Category: Banking Services
Both companies also shine in banking services. They offer checks, debit cards, and other banking tools at no additional cost.
A key difference for frequent travelers is that Schwab reimburses ATM fees worldwide, while Fidelity only reimburses fees within the U.S.
Fidelity offers a unique program called Bloom, which provides cash-back rewards and investment options through money market mutual funds. Some of these funds yield over 5.0%. Schwab uses standard bank accounts with less than 1.0% APY.
Both firms provide these banking services for free.
Winner: Draw
Third Category: Margin
Both brokers support margin trading. Schwab displays maintenance requirements for securities on its platform, while Fidelity does not show margin details for entered ticker symbols.
Both firms have the same borrowing rates for balances up to $500,000. Schwab’s rates range from 12.575% to 10.825%. Fidelity’s schedule offers an even lower rate of 8.275% for larger balances.
Both also provide portfolio margin for experienced investors with qualifying account sizes.
Winner: Once again, it’s very close
Fourth Category: Website Tech
Let’s dive into trading tools. Both brokers offer excellent website features. Schwab’s website is user-friendly, with multiple trade tickets and a browser-based platform called thinkorswim. This platform includes advanced charting tools and time & sales data.
Schwab’s site also provides helpful tools, such as an AI assistant that can answer some questions. You can create watchlists, set up alerts, use a comparison tool for analyzing securities, and access free stock reports.
Fidelity’s website offers similar features. It includes free equity reports in downloadable pdf format, watchlists, alerts, and a robo-chat feature.
The main downside of Fidelity’s website is the lack of a browser-based trading platform. However, the site compensates with robust tools, multiple order forms (market, limit, contingent, OTO), and ease of use.
Winner: Schwab
Fifth Category: Mobile Trading
Both brokers excel in mobile trading. Schwab offers three apps, each tailored to different needs. The thinkorswim app supports futures and forex trading, advanced charting with 400 technical studies, and a highly capable trade ticket. The standard Schwab app includes research tools and live CNBC news.
Fidelity has one app that delivers numerous features, including Bloomberg streaming news, market updates from Reuters, watchlists specific to the app, and access to web-based lists.
Fidelity’s Bloom accounts have their own app, offering unique features like in-app shopping that earns cash bonuses.
Winner: Schwab
Sixth Category: Desktop Software
Both brokers provide advanced desktop software. Schwab’s thinkorswim platform is top-notch, offering tools like backtesting and unique charting styles such as monkey bars.
Fidelity’s Active Trader Pro software is equally sophisticated, featuring basket-order trade tickets, Level 2 quotes, advanced options tools, and the ability to save charts.
Both programs are free to use and don’t require account minimums.
Winner: Schwab
Seventh Category: Extra Services
Automatic Mutual Fund Purchases: Schwab allows recurring purchases and systematic sales of mutual funds. Fidelity offers recurring investments for stocks and ETFs.
Extended-hours Trading: Both firms offer pre-market and after-hours trading. Fidelity provides 8 more minutes of total trading time. Futures and forex trade 24/6 at Schwab, while cryptocurrencies trade 24/7 at Fidelity.
DRIP Service: Both brokers offer dividend reinvestment into additional shares.
Fully-Paid Stock Lending: Customers at either firm can earn income by lending out their securities.
Fractional Shares: Fidelity allows purchases of stocks and ETFs in dollar amounts. Schwab limits this to S&P 500 stocks.
IRAs: Both brokers offer IRA options with no fees.
IPO Access: You can buy shares of IPO stocks at both firms before they hit the public market.
Winner: Small advantage to Fidelity
Recommendations
Mutual Fund Trading: Fidelity has more funds, but Schwab has a better search tool. Choose based on your needs.
Small Accounts: Fidelity is better for robo investing due to Schwab’s $5,000 minimum. Self-directed accounts work well at either firm.
Retirement Planning & Long-Term Investing: Both firms offer great retirement resources, including financial planners and annuities.
Stock and ETF Trading: Both firms are excellent choices.
Beginning Investors: Start with a robo-advisory account. Both Schwab and Fidelity provide access to human advisors for accounts with enough assets.
Promotions
Charles Schwab: Satisfaction guarantee and $0-fee trades at Charles Schwab.
Fidelity: None right now.
Fidelity vs Charles Schwab Summary
Both firms deliver exceptional services. Schwab edges ahead overall, but Fidelity remains a strong choice.
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Updated on 4/11/2025.
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