Fidelity Investments

Fidelity Review

Ask most investors if they have heard of Fidelity Investments, and the answer will almost always be yes. As a full-service broker with over 15 million retail brokerage accounts and $1.5 trillion in client assets as at December 31, 2014, clients expect Fidelity to provide ample service offerings and a top-notch client experience. While investment guidance and retirement services are two monster parts of Fidelity’s business, they are not the only focal points, as this review will show.

Commissions & Fees

Fidelity, like its closest competitors, uses a simple, flat-fee trading commission structure. Stock trades are $7.95, and option trades run at $7.95, plus $.75 per contract, which are rates similar to those found at TD Ameritrade, ETRADE, Charles Schwab, and Scottrade.

One standout feature of Fidelity’s is that among the big online brokers, it has the lowest margin rates for assets between $500,000 and $999,999 (3.75%) as well as for amounts over $1 million (3.75%), with ETRADE not much further behind (4.14% and 3.89%, respectively). Full margin rate schedules can be viewed and compared using the Compare Tool). 

Fidelity offers 84 commission-free ETFs, up from 76 in our 2014 Review. The broker still trails ETRADE, TD Ameritrade, and Charles Schwab, however, with Charles Schwab leading the industry with 182.

Lastly, Fidelity offers checking accounts, savings accounts, credit cards and debit cards, but no home mortgages. Its credit cards, in particular, stand out in the area of rewards. Next to Bank of America Merrill Edge, and Capital One ShareBuilder, the offering is the best in the brokerage space.

Research, Ease of Use

Fidelity’s shining star is its research, which should come as no surprise. We were extremely impressed with the overall depth and scope of what is available. In fact, so much so, it may seem at times that the amount of research is overwhelming.

Take, for example, equities research. Pull up a quote of Apple (AAPL) and you will find an Equity Summary Score alongside 13 different third-party research reports to navigate through, the largest of any broker. ETFs are not left out either, as we found five third-party research reports available for SPY.

The primary research provider for ETFs and mutual funds, as far as key data and ratings go, is Morningstar, our favorite provider for fund research, and the one all the big brokers use. We've found their screeners to be more thorough and the data more visually appealing. They also have unique tools such as the fund StyleMaps.

While the research area is fairly straightforward and easy to navigate, the rest of the site used to be a mess. In our 2013 Review, Fidelity ranked lowest among its competitors for ease of use, mostly because of its outdated website and extremely small navigation menu.

Fidelity heard us loud and clear, though, and took a big step forward in 2013 and 2014 with the launch of a brand-new main site navigation menu that is 10 times better than its predecessor. Then, in 2014, the broker launched a new client dashboard area that is 100% mobile friendly.

With its main site navigation cleared up, Fidelity should focus on adding a site-wide quote bar that includes real-time streaming quotes and a fully functioning trade ticket, so trades can be placed from any page on the site. Alongside the quote bar, making the new client dashboard customizable would really make the dashboard homey.

Customer Service, Education

When reviewing Fidelity customer service, we expected great results, and that’s exactly what we got. Fidelity once again finished as the top broker for customer service, giving us consistently high-quality service, regardless of whether we were on the phone, emailing, or using live chat.

In the area of education, Fidelity does a good job of breaking up content, sorting by experience level, category, and content type. Articles, videos, webinars, infographics, and courses are available to clients. Courses organize articles and videos into a step-by-step roadmap and track your progress so you can easily leave and come back later without forgetting your place.

Including infographics crafted in-house (two in total) was a very nice touch and extremely informative. We’d love to see Fidelity flex its creative muscles and develop infographics more often, perhaps like the interactive ones Bloomberg is now known for.

When accessing the Learning Center, we recommend simply scrolling down and filtering by “All Courses and Lessons.” The filtered category areas are a nice effort but it is too easy to lose track of where you are, not to mention overlook additional content. “Was that article I liked in this category or that category?” is the question I often found myself asking.

Platforms & Tools

Fidelity, like its competitors, does provide active trader services and tools, including two desktop-based platforms and one web-based platform.

Desktop-based platforms include Fidelity’s flagship platform, Active Trader Pro, as well as Wealth-Lab Pro. Active Trader Pro comes in both desktop and web flavors, and requires at least 36 or more qualified trades in a rolling 12-month period for access. To unlock Recognia and Elliott Wave analysis, 120-plus trades must be made.

Active Trader Pro now only trails behind the two undisputed leaders in this arena: TD Ameritrade's thinkorswim and TradeStation. To steal a top-two spot from one of these kings, Fidelity will need to muster more depth across the board, from the offering of technical studies to total optional columns in watch lists to tool customizations. Pickiness aside, Active Trader Pro is a fantastic platform that the vast majority of Fidelity clients will be very pleased with.

Alongside the platforms, Fidelity also offers Active Trader Services (dedicated trading specialists and personalized support), which has even steeper requirements. To qualify, clients must place 120 or more stock, bond, or options trades in a rolling 12-month period and maintain $25,000 in assets across their eligible Fidelity brokerage accounts.

Mobile Trading

When it comes to mobile, Fidelity provides apps for all major devices and makes them available to all clients. No prerequisites needed here, unlike the Active Trader platforms. We found the iPhone app easy to use and bug free. Fidelity does an especially good job integrating its banking services into the app, something banking clients will appreciate.

Our favorite feature was the customizable "home screen cards," which allow for a quick overview of all client products upon login. In 2014, Fidelity also added complex options, a nice plus for options traders who like to trade on the go, and have the opportunity to sell custom lots for tax purposes.

Closing Thoughts

Overall, Fidelity Investments is a very well respected broker, competing among the largest brands in the online broker space. The backbone of Fidelity’s success, specialty services and research, will certainly continue to be front and center for many years to come.

What impresses me most about Fidelity is its drive to continue innovation and push forward across all its products to provide the best possible client experience. Especially for a broker with over 15 million clients competing against other powerhouse brands, there is no time to take the foot off the gas pedal.