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Kiplinger: Best Online Brokers, 2019

FYI: As investor needs and preferences change, brokerages must adapt. Brokerages’ mobile apps have grown more sophisticated as more clients have demonstrated that they like to do business on the go. And as investors have demanded lower costs, brokerages have trimmed commissions and fees across the board.

But brokerages also need a keen ear for clients’ particular needs. Some clients want to be left alone to do their own thing, while others want their hand held. Some want to pay as little as possible to invest, and others are willing to pony up enough in assets to gain access to their own personal planner

Our 2019 online broker ranking recognizes that no brokerage can hit the bull’s-eye for every type of client, and that the firm with the broadest appeal may not meet your specific needs. But ultimately, we favored firms that could do the most for most investors.


  • Overall, a piece with lots of factoids, but no description I can find about how they scored the brokerages or features. Various Kiplinger comments about brokerages are also rather odd.

    Here are some weird statements made about E*Trade. I'm not picking on E*Trade in particular, it's just that it was the first brokerage listed.

    "More than 3,900 mutual funds you can buy with no sales fee or fee to trade".

    It looks like Kiplinger chose this arbitrary number and didn't bother to report actual figures. E*Trade claims over 4,400 NTF funds. Fidelity, which Kiplinger also says offers the same 3,900+ NTF funds appears to offer "just" 3,593, according to its fund screener. Kiplinger says the same of Schwab, though I haven't checked its true figure.

    "the highest percentage of no-transaction fee funds with three-star ratings or better from Morningstar."

    Does percentage matter? ISTM what is important is the selection (quantity) of high quality funds (I use that term loosely), not the fraction of funds offered that fit that description.

    "E*Trade’s Max Rate Checking Account comes with unlimited ATM reimbursements on charges that other financial institutions levy (though you may be subject to charges from the owner/operator of the ATM). "

    That's a curious way of saying simply that foreign ATM fees "will automatically be credited to your account."

  • @_msf hi sir, in your opinion, which brokerage[s] do you prefer most and why thx
  • I've never had an E*Trade account but when only three "points" separate the first four firms I'd be inclined to call it pretty much a tie. Not listed and not worth mentioning: Vanguard.
  • beebee
    edited August 2019
    Could be of interest to those who might transfer accounts in September:
  • Vanguard was not listed because it declined to participate, as stated in the article. Also mentioned in the article is that Vanguard offers 1800 ETFs with no commission. This alone would make it worth my consideration if I were a big investor in ETFs.

    Everyone is different and cares about different things, which is part of why the Kiplinger article was disappointing. It provided numeric scores of features with little in the way of explanation for readers to weight according to their own needs.

    I'm almost exclusively a buy-and-hold fund investor, though I do dabble in ETFs (also long term).

    Firstrade is excellent for funds because it offers access to advisor shares that you cannot get anywhere else (that I know of). I view its totally free trading as a nice temporary feature, much as it was at Scottrade, at Scudder (yes, it had a brokerage), at WellsTrade. Nice while you've got it, I just don't count on it lasting.

    Years ago, Schwab seemed to offer more funds NTF or with lower mins than elsewhere. Many funds were offered under special tickers ending in "1Z" for this purpose. For example, CHH1Z is Schwab's pseudo-share class for buying CHNAX.

    These days, it seems that either the fund company is making A shares available NTF through brokerages (as with CHNAX) without requiring a special ticker, or it's shutting down access (as with DWS funds class S, SCQGX offered by Schwab as SCQ1Z). Schwab offers a solid set of funds and has excellent service, but it seems to have lost the edge it had decades ago when fund supermarkets weren't as common.

    To some extent, Vanguard seems to have taken its place. It offers some institutional class shares with lower mins than you'll find elsewhere (notably PIMCO funds @ $25K), and provides access to institutional class shares that you can't get from other discount brokerages (such as Diamond Hill funds like DHSIX).

    I've used TDA and wasn't impressed with the fund offerings. Too high a cost for TF funds ($49.99 to buy or sell).

    Fidelity offers institutional class shares on many funds with relatively low mins, especially in IRAs. Because it enables you to buy additional shares (once you have established a position) for $5/buy (and $0 to sell), this is very cost effective for the long term investor.

    Thinking in terms of fund offerings (variety, min purchase, share class access, transaction costs) and quality of service generally, Schwab and Fidelity top my list. I wouldn't look to Vanguard just because it gives access to some unusual third party funds. But if I did have an account there to purchase Vanguard funds, I would take a closer look at its third party fund offerings, including 1,800 NTF ETFs.
  • bee said:

    Could be of interest to those who might transfer accounts in September:

    Through Sept. 5, Merrill is offering up to $1K (better than the $600 mentioned at Bankrate).
    (Definitely not intended as a recommendation for Merrill Edge.)

  • For funds that have a minimum balance of $1 million, does Firsttrade hold you to that or can you invest at lower levels?
  • Barrons did a better job in comparing the brokerages - a more balanced view. Have to agree wth @msf on his experience. We use Fidelity and Vanguard. In the end it really boils down to what the investors need in terms of NTF mutual funds, ETFs, CEFs, online service reliability, and brick and mortar offices.
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