The free-to-use, feature-rich platform offered by E*TRADE is ideal for both novice and seasoned investors. There are several commission-free ETFs and periodic discounts.
If you are looking for an outstanding broker with easy access to Bank of America research and data, look at Merrill Edge.
E*TRADE, of course, is a giant online brokerage with a plethora of experience in digital finance. Merrill Lynch’s name has been tied with Merrill Edge for many years. However, the robo-advisory developed out of Bank of America’s acquisition of Merrill Lynch and the subsequent formation of Merrill Edge as a cheap brokerage subsidiary. The similarities between Merrill and E*TRADE are enormous, but we will explore some crucial distinctions that will help you decide which provider is the best match for your money.
E*TRADE Overview
E*TRADE has one of the top user interfaces of any online broker. E*TRADE charges no fees for stock trading. There is a $500 minimum deposit, no maintenance, and no inactivity charge.
In recent years, you have seen an E*TRADE commercial on television. Unlike several of its biggest competitors, E*TRADE is known everywhere outside the financial community.
I E*TRADE, from Morgan Stanley, is a well-known brand. E*TRADE and Morgan Stanley have officially joined forces. They have been working closely to begin offering you access to an expanded array of financial products and resources representing the best of our firms—with much more to come. Recently E*TRADE became E*TRADE from Morgan Stanley.
Long-term, low-frequency traders and beginners would undoubtedly like investor counseling tools and access to support from live financial pros.
E*TRADE’s website is simple to use and includes an excellent resource for learning about investing.
Merrill Edge Overview
Bank of America’s acquisition of Merrill Lynch resulted in Merrill Edge, and it is evident that the parent business has made every effort to ensure that customers who use both services have a smooth experience. Bank of America and Merrill Edge accounts are accessible with a single login, and money may be transferred between them instantaneously via real-time transfers.
Regarding account fees, Merrill Edge earns top marks: Brokerage accounts do not charge for transfers, yearly fees, inactivity, or closure. If you move assets out of a retirement account, though, you will incur a fee of $49.95, but that amount is still cheaper than at some other brokerages.
While most investors will be satisfied with Merrill’s stock, bond, option, ETF, and mutual fund offerings, active traders looking to invest in futures or FX will have to go elsewhere. It is also worth noting that Merrill Edge does not provide fractional shares. Brokers increasingly provide this service, allowing customers with fewer resources to diversify their portfolios. This may be more difficult to do without the use of fractional shares.
E*TRADE vs. Merrill Edge – Service & Feature Comparison
Costs
E*TRADE provides commission-free ETFs, but if your favorite funds are not on E*TRADE’s zero-fee list, then the trade would be cheaper through Merrill Edge.
You will be glad to learn that E*TRADE and Merrill Edge offer low commission pricing that will not break the bank.
For most deals, the cost difference comes down to a little more than $3 per trade, although some investors will pay significantly less than the listed amount. Some qualify for special incentives for IRA accounts, including commission-free transactions and cash bonuses. Furthermore, hundreds of funds are available for purchase and sale through both brokerages.
| Broker | Options & Shares | Electronic Funds | Mutual Funds |
|---|---|---|---|
| Merrill Edge | $6.95 per trade + $0.75 per options contract | $6.95 per trade | $19.95 per purchase |
| E*Trade | $9.99 per trade + $0.75 per options contract | $9.99 per trade | $19.99 per purchase |
Account Types
Using our Merrill Edge account, we identified ETFs, bonds, stocks, derivatives, certificates of deposit, and mutual funds. To trade these products, the brokerage provides a variety of account kinds. For example, there are IRA, single 401(k) ‘s, annuities, 529 plans, and UGMA/UTMA possibilities.
Moving to E*TRADE, we discovered all of the investing instruments accessible at Merrill, plus futures contracts. E*TRADE also performs an excellent job of offering IPOs to its consumers. The E*TRADE website offers an IPO center, whereas Merrill does not offer it.
Investment items at E*TRADE can be purchased in several accounts. They also provide custodial accounts, IRA’s, Coverdell savings arrangements, and individual 401(k) plans.
To start a brokerage account, you will not need to deplete your savings account. Merrill Edge offers no minimum initial deposit requirement; however, E*TRADE needs a $500 minimum initial deposit. Neither broker’s minimums are sufficiently high to disqualify many investors based on minimum deposits.
Education and Research
We typically feel that having more knowledge may be a benefit, particularly for investors who adopt a do-it-yourself approach to investing. E*TRADE and Merrill Edge offer access to third-party research, including S&P Capital IQ and Morningstar.
Proprietary research is also abundant at any brokerage. In addition to Bank of America Merrill Lynch stock choices, Merrill Edge members may use E*TRADE’s charting and screening capabilities. As a brokerage user, you can access many studies to help you make financial decisions.
Range of Investments
If you try to trade on your own, you may discover outstanding selections of mutual and exchange-traded funds at both businesses. We were able to identify 8,500 mutual funds on E*TRADE’s website. About 4,300 have no transaction cost and no burden attached to them.
Merrill Edge falls short in this instance. We discovered just 3,200 equities that were available to new investors using its mutual fund screener. Somewhere in the low hundreds, there are no transaction fees or loads.
Stocks, fixed-income instruments, futures (including cryptocurrency futures), options (including options on futures), exchange-traded funds, closed-end funds, and mutual funds are all available with our E*TRADE trial account. The broker’s website also features an IPO center.
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ETFs, mutual funds, closed-end funds, stocks, bonds, and options contracts are all available to investors at Merrill Edge. We did not discover an IPO section on its site.
As for fund resources, both broker-dealers are outstanding. Screeners are straightforward to use with lots of search criteria. Fund profile pages give essential information, while fund centers on the brokers’ websites offer valuable data.
We also enjoy the two listings from both brokers. Investment advisers create these funds intending to maximize returns while minimizing risk.
Managed Accounts
A fee-based portfolio management service is available from both brokerage firms. E*TRADE offers a wide range of products from which to select. The first one is a robo service. Exchange-traded funds with low-cost ratios are traded on this platform. The fee is 30 basis points each annually, and the first year is free. There is a $5,000 minimum investment deposit requirement with this plan.
E*TRADE also offers conventional management services, which are included in various package options. You get a more personalized service even if the costs and minimums are higher. Additional investing options are included in these bundles.
If you want a computer program to make trading choices in your account, you must go with E*TRADE. Merrill Edge does not offer this service. If you want conventional management, you may have it for as little as 0.45% of the total cost. And there is only a $5,000 minimum investment amount.
This is a low-cost bundle. For a higher price, Merrill provides more comprehensive packages. Merrill Lynch’s investment advisors and a Merrill Edge financial planner provide customized portfolio evaluations for a 0.85 percent fee and a $20,000 minimum investment.
Trading Technology
You will need user-friendly software when you are ready to place a deal. Both brokers thrive swiftly in this sector. We used the trading bar at the bottom of the Merrill Edge website to place our orders. Trialing orders are accessible, but they cannot trade options.
For most traders, the information provided on the website is more than adequate. Charting is straightforward, but the broker’s PC application offers superior charting. Customers that fulfill the minimal trading requirements can use it. It provides the most excellent trading tools for the organization.
Merrill does not offer a browser platform, although E*TRADE has. Called Power E*TRADE, this program comes with various advantageous features. First up is Bloomberg Business News, which broadcasts in HD free of charge. The Power platform, which was left over from OptionsHouse, supports many multi-leg orders, including options chains. And we appreciated the economic calendar during our investigation. Future conference calls and dividends were displayed for our convenience.
Like Merrill’s, E*TRADE has a desktop platform equivalent to theirs. Level II quotes, market news, and option tools are just a few valuable tools available. Missing at E*TRADE is an online trade bar.
Merrill Edge and E*TRADE both provide excellent trading platforms. It primarily concerns personal choice rather than an impartial comparison. Many brokers give the chance to try their platform without establishing an account, which may be a fantastic method to discover which platform suits your style.
Financial charts from Merrill include twenty technical studies, four chart styles, and three corporate events. The fact that a chart does not take up the complete width of the screen is one drawback.
When using E*TRADE, charts may span the whole width of the screen for optimal viewing. There are technical indicators, corporate events, and seven graph styles. While E*TRADE’s website does include other noteworthy features, it is better to go right to the point and focus on the platform’s primary selling point: ease of use.
Mobile Apps
To trade on the go, use Merrill’s or E*TRADE’s mobile apps if you do not have time to use a PC. Power applications are offered by E*TRADE and are based on the browser system. Combining Level II quotations, complicated options techniques, and futures trading, E*TRADE offers a unique mobile trading experience.
Merrill provides comparable functionality in certain areas but lacks streaming financial news and multi-leg option chains. As with E*TRADE, graphs on Merrill’s app offer essential resources, including horizontal charting, corporate events, and technical analysis.
Other Features
Each of the brokerages in our study provides round-the-clock phone help. In terms of service, we have had nothing but positive experiences with all the businesses we have tested. Human chat is accessible on both platforms, although it is more regular on E*TRADE. Neither firm now offers a robo-chat service, but that is likely to change shortly.
One area where there is a significant disparity is branch locations. E*TRADE has 30, while Merrill has none. Although some Merrill Edge facilities are within Bank of America branches, these are not customer service venues. They are solely for investment-advisory customers.
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Dividend Reinvestment Program: DRIP programs are accessible at both broker-dealers. There is no fee from either.
Individual Retirement Accounts (IRAs) are available from both companies. Merrill Edge costs $49.95 to cancel an IRA, whereas E*TRADE charges $25 for numerous services.
Customers of Merrill Edge and E*TRADE can trade American depositary receipts to invest in international firms (ADRs). Trading foreign equities on a foreign exchange is not possible through either brokerage.
Access to overseas marketplaces may be crucial for you. On the other hand, large overseas firms often have ADRs, and both brokerages make it possible to invest in foreign equities through funds containing ADRs.
Automated Investing
The brokerage firms in this competition provide portfolio management for clients who have not discovered the results they are searching for with their investing plans.
E*TRADE starts with a robo package that costs just thirty basis points per year with a $500 initial commitment. Customers who do not trust computer programs to make trading judgments might opt for an old-school bundle. Stocks and mutual funds, for instance, can be exchanged. Management costs vary from 0.65 percent to 1.25 percent.
There is no robo advisor available through Merrill Edge. It utilizes human advisors at Merrill Lynch to monitor and choose assets. Merrill Guided Investing is an online service that charges forty-five basis points per annum with a $5,000 minimum balance. The broker will offer a one-on-one working relationship with an advisor for 85 basis points per year (and a $20,000 minimum balance). Bank of America Preferred Rewards members receives a 0.15 percent discount with any plan.
My Preference: E*TRADE Wins Over Merrill Edge
For futures traders, we prefer E*TRADE over Merrill because Merrill does not provide them. For investing guidance, we are going to propose E*TRADE. An automated service is available, as are numerous pre-configured options.
If you want the greatest trading technology, it is a toss-up. Merrill Edge’s trade bar is excellent if you plan to perform most of your online trading. Choosing E*TRADE’s browser system is innovative if you do not plan on trading regularly.
For IRAs, we prefer Merrill Edge since E*TRADE has many $25 fees. Investors in mutual funds will benefit more from using E*TRADE’s services.
E*TRADE vs. Merrill Edge: The Bottom Line
Each of these brokers would be a good fit for a specific investor. For qualifying consumers, Merrill Edge provides minimal fees and several commission-free monthly trades. E*TRADE’s costs are higher, but its commission-free ETFs may make it the superior alternative for fund investors. Ultimately, it is about how each broker’s advantages and disadvantages mesh with your portfolio’s specific characteristics.
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