Merrill Edge versus Interactive Brokers - compare IRA, commissions, investing fees, trading tools, account differences, pros and cons. Which online broker is better?

Merrill Edge versus Interactive Brokers Matchup

Merrill Edge and Interactive Brokers (IBKR) both offer a lot of great trading services and tools at reasonable prices. In some areas, however, they do differ quite a bit. So it’s a good idea to be aware of their variances before making a choice.

Pricing

Broker Fees Stock/ETF
Commission
Mutual Fund
Commission
Options
Commission
Maintenance
Fee
Annual IRA
Fee
IB $1+ $14.95 $0.25+ per contract $0-$240** $30
Merrill Edge $6.95 $19.99 $6.95 + $0.75 per contract $0 $0

Services

Broker Review Cost Investment Products Trading Tools Customer Service Research Overall Rating
IB
Merrill Edge

Promotions

Interactive Brokers: Open account and get $200 for a friend you refer.

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


Available Investments

Merrill Edge offers equities, ETF’s, closed-end funds, mutual funds, bonds, and options. Interactive Brokers offers all of these plus warrants, contracts for difference, forex, precious metals, futures, options on futures, and bitcoin futures.

Interactive Brokers wins the opening category.

Extended-Hours Trading

Both firms in our investigation provide extended-hours trading. IB’s early bird session begins four hours before the opening bell, whereas Merrill opens two hours early. The brokers’ after-hours periods are the same length.

IB wins the second category.

Level II Quotes

Merrill Edge offers Level II quotes to customers who place at least 30 trades per quarter or who have at least a million dollars in assets (within the Bank of America family). Interactive Brokers offers the same data, but charges for the quotes.

We’ll call it a draw here.

Margin Policies

Merrill Edge requires 50% down for an initial long stock position and 30% as maintenance (the security must be priced above $10). For short stock positions, the percentages are the same, but the $10 requirement is $16.67.

At Interactive Brokers, the initial requirement for long positions is the same 50%, but the maintenance requirement is a lower 25%. For short positions, both percentages are 30% with a $16.67 floor.

IB wins here.

Website Comparison

At Merrill Edge, traders can use a very well-designed website. During our investigation, we were able to navigate the site without any difficulties. Unfortunately, the Merrill site has eliminated a trade bar that was the hallmark of website trading there.


Merrill Lynch vs IBKR


Features that do remain include a pop-out streaming quotes system that gives real-time data without any trading capability, an activity center with account information, a chart with historical account value, alerts, and a watchlist.

Charting on the Merrill Edge site offers less than 30 technical indicators, 4 chart styles, and 3 company events. Comparisons can be made to individual stocks, economic sectors, or major indices. We were disappointed to discover a chart cannot be expanded or detached.

We were impressed with the site’s option strategy builder. It suggests a variety of option trades based on predictions of volatility and price movement. After entering a ticker symbol and selecting a proposed derivative trade, an order ticket is automatically populated. A profit-loss diagram is displayed along with Greek values.

Moving to Interactive Brokers, we also get a lot of website tools. The first is a client portal, which is a simple system with currency rates, market news, info on potential investments, and an order ticket.


IBKR vs Merrill Egde


WebTrader is Interactive Brokers’ browser-based trading platform. Charting is overly simple and underperforms Merrill’s by a large margin. However, its trade ticket is more advanced, offering not just the stop and trailing orders we found at Merrill, but also on-the-close orders. Another strength of IB’s software is direct-access routing. Finally, we liked the ability to trade a large variety of instruments, such as warrants and currencies.

Option tools available to IB customers include chains and direct-access routing. Unfortunately, we didn’t find any profit-loss diagrams or Greek values.

Overall, it’s a tie here.

Mobile Platforms

Merrill Edge’s app comes with funds transfer, bill pay, and check deposit. We especially liked the incorporation of a free FICO score. Touch ID is possible on Apple phones, and the order ticket is very user friendly. We found both regular and extended-hours trading with stop and trailing orders. Options and mutual funds can be traded on the app. Statements can be downloaded, and security research is possible. Horizontal charting is available with a few tools.


IBKR vs Merrill Lynch


Moving to Interactive Brokers, we get iBot, an integrated AI that is able to answer many questions. Charting is a step above Merrill thanks to better details on technical studies. An equity screener is able to look for securities that match specific conditions. Commentary is available, and the app’s order ticket provides more order choices than Merrill’s. As with the Merrill app, option contracts can be traded. Missing is mobile check deposit, but we did find financial videos.


Interactive Brokers Mobile App


Overall, it’s too close to call here.

Other Tools

Both Interactive Brokers and Merrill Edge have desktop programs and smartwatch apps for Apple Watch. The IB platform offers very advanced charting with roughly 100 technical indicators, a demo mode, Level II quotes, time & sales data, advanced option tools, and more. iBot makes another appearance.

Webull’s platform offers full-screen charting, but only has 10 technical studies. There is a demo mode, which IB also offers. Webull’s order ticket doesn’t provide direct-access routing, which IB’s program does offer. A lot of the security research on the mobile app is also available on the desktop system, which is largely based on the mobile app.

This category is awarded to IB.

DRIP Service

Both Interactive Brokers and Merrill Edge offer a Dividend Reinvestment Program at no cost. At IB, it’s not possible to enroll specific securities; only an entire account can be signed up. At Merrill, individual securities can be enrolled.

IB loses its first category.

Promotions

Interactive Brokers: Open account and get $200 for a friend you refer.

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


Recommendations

Traders who need the best technology should definitely go with Interactive Brokers.

For retirement saving, we’re going to recommend Merrill Edge over Interactive Brokers. While either would be a fine choice, we like Merrill’s retirement calculators, available free of charge on its website.

For beginning investors, we think Merrill Edge’s virtual learning center is the better route to take. There are articles, calculators, and videos on a wide range of topics; and these can be sorted by experience level.

We suggest Merrill Edge over its rival here for traders with at least $20,000 in combined balances within the Bank of America family of companies. At this level, Merrill offers free trades.

Merrill Edge vs Interactive Brokers: Which is Better?

Interactive Brokers delivered a strong showing, but some Bank of America customers will find a much better value at Merrill Edge.



Firstrade


Continue Reading