The Bottom Line: Merrill Edge’s $2.95 trade commission is higher than the competition, but free trades are available to investors who qualify for the company's Preferred Rewards program. Plus, Merrill clients have access to customer support at about 2,500 Bank of America locations.
Pros & Cons
Robust third-party research.
Integrated with Bank of America.
Free trades for eligible Bank of America customers.
$2.95 trade commission.
Minimum balance requirement for active-trading platform.
Compare to Similar Brokers
Merrill Edge appeals to casual traders with a powerful combination of competitive pricing and robust research. Its trade commissions run $2.95, but unlimited free trades can be had by clients who qualify for the company's Preferred Rewards program.
Merrill clients also have access to customer support at about 2,500 Bank of America locations, and the firm's research and educational resources are robust.
Merrill Edge is best for:
Bank of America customers
Where Merrill Edge shines
Integration with Bank of America: Merrill Edge is a product of Bank of America’s acquisition of Merrill Lynch, and it’s clear that the parent company has made efforts to create a seamless experience for clients who use both services. You can view your Bank of America accounts and Merrill Edge accounts with a single login, and real-time transfers move money between accounts instantly. The same integrated experience is available on mobile, and you can even view your Merrill Edge investment account balances on Bank of America ATMs.
Free trades for Preferred Rewards members: Merrill Edge has a continuous promotion that offers customers commission-free online stock, ETF and options trades if they qualify for the Preferred Rewards program. Options trades carry a per-contract fee of $0.65, which is competitive with other brokers.
To qualify for Preferred Rewards, you must have an eligible Bank of America checking account, plus a three-month average combined balance of $20,000 or more in Bank of America deposit accounts and/or qualified Merrill Edge and Merrill Lynch investment accounts. The Preferred Rewards program also gives you access to other discounts and promotions
Research: The company provides research from its own BofA Merrill Lynch Global Research, as well as third-party providers, including Morningstar, CFRA, Trefis and Recognia. Mutual fund reviews and rankings come from Morningstar and Lipper, and the company compiles a list of Merrill Edge Select ETFs and Merrill Edge Select Funds, with the top funds in each category as evaluated by Merrill Lynch investment professionals. Merrill Edge’s website also has a lot of educational resources, including videos, courses, webinars and articles, all searchable by investing experience or topic. Morningstar’s investing classroom is available on the site, too.
With Merrill Edge's “Fund Story" feature, you can research a mutual fund’s holdings (that is, what it's investing in), the sectors it covers, its historical performance, third-party analyst ratings and more. Plus, the fee analyzer illustrates the cost of owning the fund over time. Similarly, “Stock Story” offers detailed information on individual stocks, all in an easy-to-follow format.
Where Merrill Edge falls short
Trading platform restrictions: Like many brokers, Merrill Edge offers both website trading and an active trader platform, called Merrill Edge MarketPro, which is browser-based. The company’s website is clean and intuitive, and offers several screeners so you can quickly sort through stocks, mutual funds, ETFs and bonds. The MarketPro platform is also robust, with much of what active traders expect: interactive charts, alerts, a customizable dashboard, and streaming data and news.
But MarketPro requires Java and has restricted access. It’s available only to customers who maintain a combined balance of $50,000 or more in Merrill Edge, Merrill Lynch and/or Bank of America accounts or make at least 15 trades per quarter. (Customers who qualify for the Preferred Rewards Platinum or Preferred Rewards Platinum Honors programs also get access to MarketPro.) Level II quotes, which show real-time bid and ask prices for Nasdaq stocks, are available only to investors who trade at least 30 times per quarter or maintain a total combined balance of $1 million or more in their Bank of America and Merrill Lynch accounts.
Commissions: Merrill Edge’s $2.95 trade commission for clients who don't qualify for Preferred Rewards is high compared to competitors, which are frequently offering completely free trades to all clients.
However, new customers can get 300 free exchange-traded fund and stock trades online for three months. This particular promotion is no longer touted on the company's website, so you have to ask for it over the phone or at one of their branches.
Commission-free ETFs: The company doesn’t have any, though the commission-free trading available through Preferred Rewards, as described above, applies to ETFs as well as stocks. A lack of commission-free ETFs isn’t unheard of at a discount broker, but it’s worth noting. Even with Merrill Edge’s low-cost commissions, ETF investors may pay more here if they don’t qualify for free trades.
Is Merrill Edge right for you?
If you’re a Bank of America customer who qualifies for Merrill Edge's free trades, the broker has much of what you’d need — high-quality research, a good investment selection and helpful customer service. The company ranks among the top of the field when it comes to online brokers.
Customers who don’t qualify for free trading will likely want to choose a different broker, as the $2.95 trade commission is no longer competitive given the industry's move toward free commissions for all customers.
» Want more choices? See our best online brokers for stock trading
on Merrill Edge's website