The bottom line: Fidelity offers $0 trading commissions, a selection of more than 3,400 no-transaction-fee mutual funds and top-notch research tools and trading platform. Its zero-fee index funds and strong customer service reputation are just icing on the cake.
Best Broker for Beginning Investors, Best App for Investing
no promotion available at this time
Pros & Cons
Commission-free stock, ETF and options trades.
Large selection of research providers.
Strong customer service.
Expense-ratio-free index funds.
Highly rated mobile app.
Relatively high broker-assisted trade fee.
Compare to Similar Brokers
no promotion available at this time
$5 to $1,000
in free stock for users who sign up via mobile app
Get $600 or more
when you open and fund an E*TRADE account with code: BONUS21
Get more smart money moves — straight to your inbox
Become a NerdWallet member, and we’ll send you tailored articles we think you’ll love.
Fidelity Investments has a strong reputation for its mutual funds, but its brokerage arm is no slouch either: It offers $0 trading commissions, a swath of research offerings and an easy-to-use platform that also can be customized for more advanced traders.
The reputation for funds isn't wrong, either: The broker scored five stars from us across every funds category with a large selection of no-transaction-fee funds, including its Fidelity Zero index funds, which have no expense ratio and no minimum investment requirement. These investor-friendly practices save customers a lot of money.
Fidelity Investments is best for:
Commission-free stock, ETF and options trading.
Fidelity Investments at a glance
Stock trading costs
No base commission; $0.65 per contract.
Account fees (annual, transfer, closing, inactivity)
Number of commission-free ETFs
All ETFs trade commission-free.
Number of no-transaction-fee mutual funds
More than 3,400 no-transaction-fee mutual funds.
• Fractional shares.
• Mutual funds.
Fidelity.com and Active Trader Pro. Both free for all customers.
Available for iOS and Android; advanced features.
Research and data
Free and extensive.
Customer support options (includes website transparency)
Phone, email and live chat 24/7; 200 local branches.
Where Fidelity Investments shines
Commissions: Fidelity was already a leader for low-cost commissions, but the company eliminated commissions in 2019 for stock, ETFs and options. Before that, the company did away with nearly all account fees, including the transfer and account closure fees that are commonly charged by brokers.
Mutual funds: The war among brokers to cut mutual fund fees has brought good changes to Fidelity: The company was the first broker to bring to market index funds with absolutely no expense ratio: the Fidelity Zero Total Market Index Fund, the Fidelity Zero International Index Fund, the Fidelity Zero Large Cap Index Fund and the Fidelity Zero Extended Market Index Fund.
Investors could build a balanced — and virtually free — retirement portfolio with these zero-expense-ratio funds alone, but even the Fidelity index funds that do charge an expense ratio undercut much of the competition on price. In total, investors at Fidelity have access to over 3,400 no-transaction-fee mutual funds and over 700 mutual funds and index funds with expense ratios of 0.50% or less. Those funds come from Fidelity and other mutual fund companies.
Fidelity also offers a large selection of funds with low or no minimum — all Fidelity funds for individual investors require no minimum investment.
Research: Fidelity is strong here, with stock research from 20 third-party providers, including Recognia, Ned Davis Research, Thomson Reuters and McLean Capital Management. The company offers ETF research from five providers and options strategy ideas from options analysis software LiveVol.
Stock quote pages show an Equity Summary Score, which is a consolidation of the ratings from these research providers. It gives an “accuracy-weighted sentiment derived from the ratings of independent research providers on Fidelity.com,” according to the website.
This number of research firm offerings might seem like too much to wade through, but investors can take a short quiz to identify providers that match their investment style. A research firm scorecard evaluates the accuracy of the provider's recommendations.
Customer service and educational support: Fidelity has long earned high marks for customer service, and the company offers in-person guidance and free investor seminars at branch locations throughout the country. Seminars cover such topics as how to navigate the company’s website, when to take Social Security, and the basics of technical analysis. Online, Fidelity’s learning center offers guides and webinars on a similar range of issues.
Platforms and tools: Like other brokers, Fidelity offers trading via its website and mobile apps, plus a desktop platform for active traders.
The company’s online trading platform is easy to navigate and fairly comprehensive — highlights include advanced screeners using the aforementioned research and strategy-testing tools based on 10 years of historical data. Fidelity’s mobile app is equally impressive, with real-time quotes, multi-leg options trading, a consolidated version of the company’s research offerings, and a notebook where you can save ideas and articles from your mobile browser.
Active traders will prefer the company’s Active Trader Pro platform, which is now available to all investors for free. Active Trader Pro includes both a downloadable desktop version and a web alternative at ActiveTraderPro.com. Investors can toggle seamlessly between the two. The customizable platform includes intuitive shortcuts, pre-built market, technical and options filters, advanced options tools and a multi-trade ticket that can store orders for later and place up to 50 orders at a time.
» Need help learning to trade? See our guide on how to buy stocks
Cash management account: Fidelity offers a cash management account with FDIC insurance that can be paired with a Fidelity brokerage account. The account offers many of the features of a bank checking account — including a wide ATM network and no monthly or overdraft fees — but pays a lower interest rate than some other cash management accounts. (Read our full review of Fidelity's cash management account.)
Where Fidelity Investments falls short
There isn't much we don't like about Fidelity: The broker has always tested well in our reviews, and this year was no different. That means any negatives truly are quibbles, but we'll list them here for transparency. Fidelity got its lowest marks from us for:
While it offers fractional shares and options trading, lack of futures or forex trading options gives it only a 3-star rating for tradable securities.
A broker-assisted trade fee that is higher than we like to see, at $32.95.
» Want more choices? See our best online brokers for stock trading
The bottom line
Fidelity is the rare broker that's able to serve both active traders and retirement investors alike. The company brings it on every level, starting with a mutual fund selection that stacks up to any other broker and even includes free offerings. But Fidelity also offers features that matter to stock traders, including strong trading platforms, zero trade commissions and a wide range of research offerings. We can't think of an investor who won't be well-served by Fidelity.
More from NerdWallet:
How do we review brokers? Here’s our methodology.
NerdWallet’s comprehensive review process evaluates and ranks the largest U.S. brokers by assets under management, along with emerging industry players, using a multifaceted and iterative approach. Our aim is to provide an independent assessment of providers to help arm you with information to make sound, informed judgements on which ones will best meet your needs.
DATA COLLECTION AND REVIEW PROCESS
We collect data directly from providers, and conduct first-hand testing and observation through provider demonstrations. Our process starts by sending detailed questionnaires to providers to complete. The questionnaires are structured to equally elicit both favorable and unfavorable responses from providers. They are not designed or prepared to produce any predetermined results. The questionnaire answers, combined with product demonstrations, interviews of personnel at the providers and our specialists’ hands-on research, fuel our proprietary assessment process that scores each provider’s performance across more than 20 factors. The final output produces star ratings from poor (one star) to excellent (five stars). Ratings are rounded to the nearest half-star.
Evaluations vary by provider type, but in each case are based upon the weighted averages of factors that include but are not limited to: advisory and account fees, account minimums and types, investment selection, investment expense ratios, trading costs, access to human financial advisors, educational resources and tools, rebalancing and tax minimization options, and customer support including branch access, user-facing technology and mobile platforms.
Each factor can involve evaluating various sub-factors. For instance, when gauging the investment selections offered by robo-advisors, 80% of the score is based on the potential for diversification (how well-diversified a resulting portfolio of investments could be) combined with the availability of specialty portfolios and level of customization for investors. Expense ratios form an additional 10% of the score, and low or no management fee the remaining 10%.
The weighting of each factor is based on our team’s assessment of which features are the most important to consumers and which ones impact the consumer experience in the most meaningful way. The factors considered, and how those factors are weighted, change depending upon the category of providers reviewed.
Writers and editors conduct our broker reviews on an annual basis but continually make updates throughout the year. We maintain frequent contact with providers and highlight any changes in offerings.
THE REVIEW TEAM
The review team comprises seasoned writers, researchers and editors who cover stocks, bonds, mutual funds, index funds, exchange-traded funds, alternative investments, socially responsible investing, financial advisors, retirement and investment strategy on a daily basis. In addition to NerdWallet, the work of our team members has been published in The New York Times, The Washington Post, Forbes, USA Today, Bloomberg News, Nasdaq, MSN, MarketWatch, Yahoo! Finance and other national and regional media outlets.
The combined expertise of our Investing team is infused into our review process to ensure thoughtful evaluations of provider products and services from the customer perspective. Our writers and editors combine to have more than 70 years of deep experience in finance, ranging from a former Wall Street Journal reporter to a former senior financial advisor at Merrill Lynch.
CONFLICTS OF INTEREST
While NerdWallet does have partnerships with many of the reviewed providers, we manage potential conflicts of interest by maintaining a wall between our content and business operations. This wall is designed to prevent our writers and the review process from being influenced or impacted by our business partnerships. This way, all reviews can provide an unbiased review that serves the interests of our users. For more information, see NerdWallet’s editorial guidelines.