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Account Minimum: $0  –  Fees: $6.95 per trade (Free for BofA customers)  –  Best for: Free Trades

VISIT MERRILL EDGE

Merrill Edge has access to great 3rd party research, constant promotions and helpful integrations with their parent company.

TL;DR – If you are a Bank of America customer Merrill Edge is a no brainer. They offer free trades and it integrates seamlessly with your bank account. For non BofA customers, their research options still sets them apart from the competition.

A zoomed in image on a banknote.

What is Merrill Edge?

There are three different services offered by Merrill Edge. A self-directed investing program, guided investing and investing with an advisor.

Self-directed:

This is their brokerage platform. Get insights and tools to analyze and track investments. Trades are $6.95 for non Bank of America customers. It is free for their customers. This is the platform we will be looking at, but it is worth knowing about guided investing and investing with an advisor.

Guided investing:

This is somewhere in between self-directed and an advisor. You invest online with Merrill, but you are provided guidance by their advisors. The minimum investment is $5,000. There is an additional 0.45% annual management fee.

Invest with an advisor:

This is similar to working to working with a financial advisor at any other institution. The minimum investment is $20,000, and they charge a relatively steep management fee of 0.85%. The upside is the (perceived) peace of mind that comes with a financial advisor.

Aron Levine, head of Merrill Edge
Aron Levine, head of Merrill Edge

Who Created Merrill Edge?

In 2010 Bank of America combined their online trading platform with research from Merrill Lynch. Bank of America is the 2nd largest bank in the United States. Merrill Lynch is an investment management company owned by Bank of America.

Merrill Edge launched with 500,000 customers from Bank of America’s current client roster. It now boasts 2 million customers and $118 billion in assets.

Since their launch Merrill Edge has expanded their offerings to include the guided investing and advisor investing options. They state they are looking into moving more into automated investing advice moving forward. Their customers have historically been wealthier and older, but they recently hired 300 new employees to focus on selling to younger less affluent clients.

How Does Merrill Edge Work?

Merrill Edge has solutions for all types of investor. They now offer a wide range of products and services meeting almost any need.

Below are some of the investing options in a Merrill Edge account:

General Investing

Stocks

Not much to explain here. $6.95 per unlimited online equity and ETF trade. If you have a BofA account you qualify for the free trades. They say sales are subject to a transaction fee of between $0.01 and $0.03 per $1,000 of principal.

Exchange-Traded Funds (ETFs)

Exact same pricing for stocks applies to their ETFs.

Mutual Funds

They offer over 2,400 different no-transaction-fee mutual funds. Research for these funds is provided by Morningstar and Lipper. For pricing details see the prospectus on any mutual fund.

Fixed Income & Bonds

There are no fees on online trades new issues, Brokered CDs, Auction and Secondary Treasuries. Treasuries have a $29.95 per trade service charge for Representative Assisted Trades.

All other secondary trades including Corporate Bonds, Municipal Bonds and Government Agencies have a $1 per bond fee, with a $10 minimum and $250 maximum. A $29.95 service charge is issued for Representative Assisted Trades.

For Experienced Traders

Options

Online trades are $6.95 per trade plus $0.75 per contract.

Representative-assisted trades are $29.95 per trade plus $0.75 per contract.

Exercised/assigned are $6.95 per trade.

Margin

The Merrill Lynch Base Lending Rate (BLR) is 7.500%.

For Simplified Investing

The BofAML US 1 List is just an investment idea generator offered to Merrill Edge customers at no extra cost. The Select Funds and ETFs have a 0.85% fee. They require a $20,000 initial minimum investment.

BofAML US 1 List

Get investment ideas with buy-rated stocks recommended by BofA Merrill Lynch Global Research analysts. This is offered at no additional cost.

Merrill Edge Select Funds

The Merrill Lynch screening process makes it easy to find quality mutual funds.

Merrill Edge Select ETFs

Helps investors simplify choosing ETFs.

Managed Portfolios

Merrill Guided Investing

An online investment advisory program that combines the best of online investing with a professionally managed portfolio. $5,000 minimum investment, 0.45% annual fee.

Merrill Edge Select Portfolios

Meet with a Merrill Edge Financial Solutions Advisor™ to help you select a diversified portfolio of investments aligned to your investment goals, time horizon, risk tolerance and liquidity needs—pre-screened, monitored and adjusted by the investment professionals at Merrill Lynch. $20,000 minimum investment, 0.85% annual fee.

What if I have Bank of America?

If your account balance is over $100,000 or you make 30+ trades per quarter you qualify for their lower pricing ($3.95 per trade plus $0.50 per contract).

If you are an active trader making any ETF trades Ally Invest may not be the right option for you. Only 116 of their ETFs are commission-free. Fidelity offers over 500 commission-free ETFs.

Penny stock trading is also not the best idea on Ally. They charge an extra $0.01 fee on any stock under $2.00 per share. This is capped at 5% commission per trade value.

4 reasons we love Merrill Edge

  1. Free Trades (If You Qualify) – The standard pricing for trades at Merrill Edge is higher than some of their competitors. For non BofA customers Fidelity, Charles Schwab and Ally Invest offer a lower fee of $4.95 per trade. With BofA you have access to 30 free trades a month for a balance over $50,000. If your balance passes $100,000 you can make 100 free trades a month.
  2. Bank of America Integration – BofA and Merrill Edge are nested under the same account. This means you can make instant transfers from your bank account to Merrill Edge.
  3. Mobile Usability – Merrill Edge works to provide a great user experience. See info in iOS notification center, access reports from Android or iPhone, and trade from your smartwatch.
  4. Research – Bank of America works with Merrill specifically for their research capabilities. In addition to their own platform you have 3rd party insights from Morningstar, CRFA, Trefis and Recognia. In addition to this Merrill Edge provides selection from their investment professionals. If you are new to investing they provide a wide range of learning materials for you to choose from.

Where Merrill Edge could improve.

  1. High Minimum Balance – The features with a Merrill Edge account are great, but many of them are not available until your account balance reaches $50,000. This is a high number, especially for new or young investors.
  2. No Fee-Free ETFs – There are no free ETFs on their platform, While this is not out of the ordinary, TD Ameritrade just announced they offer over 500 commission-free ETFs on their platform. This shouldn’t scare off investors, but it’s something to keep in mind.
  3. Pushing Add-Ons – Merrill Edge wants new users to get an investment advisor. Most people do not need it and it seems overpriced. The brokerage is the main product they specialize in.
  4. Difficult to Use – Some report a poor experience when using Merrill Edge’s trading platform (MarketPro). There are delays in placing orders. Placing an order takes a considerable amount of time, which can have a significant impact on people who are making quick trades.

Merrill Edge Review: The Bottom Line

If you are a new investor, or looking for an easy solution that integrates with Bank of America then Merrill Edge may be right for you. For high-frequency traders or people with low account balances this is not an easy fit.

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