Pros: Great research tools; Trades are completed very quickly
Cons: Web site needs some changes: Commissions are higher than others
Financial markets haven't been very stable as of late and many investors have pulled their money out of stock investments, opting instead for safer investments like money markets, government bonds, and corporate bonds and/or their respective mutual funds. Many avenues exist to purchase these investments and the one I have been using for many months is Fidelity Investments, the brokerage service for the popular mutual fund company.
What Does Fidelity Offer?:
Fidelity Investments offers services such as:
401K or IRA Information- Fidelity is known for its mutual funds more than anything and many investors have money in Fidelity Mutual Funds through their 401k plan or IRA. With Fidelity brokerage, customers can gain greater control over their financial assets by utilizing Fidelity's many tools to setup automatic investment contributions to their IRA, transfer money between accounts, invest part of their retirement in the stock market or other investments, etc.
Investment Research- Most important to any brokerage service is its investment research and Fidelity offers plenty of tools to research known investments and to seek out investments by asking for specific criteria. The online site also offers alert notices, IPO information, and more.
Retirement Guidance- Maybe you are new to retirement investing and need a little guidance? If so, Fidelity offers some basic advice on retirement needs, taxes, trusts and estates, insurance, giving to charity, etc.
Other Investments- Fidelity is a full- service brokerage service, offering a full range of investment options. Customers can purchase annuities, fixed income investments, and more.
Fidelity charges sales commissions each time you buy or sell an investment and the fees charged by Fidelity are pretty standard. Fidelity brokers adjust your commissions downward per trade if you have a large portfolio value and/or if you make a large number of trades each year. Fees can be as high as $19.95 per market order for small investors and infrequent traders and as little as $8 per trade for large investors or those who trade investments on a very frequent basis.
Fidelity Investments is a brokerage service I have been using for several months now, following the conversion of an old 401K account into an IRA. I had heard about Fidelity for many years, but I got to know the company on a more personal basis when my 401K plan administrators decided to transfer part of our money over to Fidelity. I knew Fidelity was performing well on the mutual fund side and I had heard positive feedback about Fidelity as a brokerage service. So, I made the decision to roll over my 401K into a Fidelity IRA account, giving me greater control over my assets and allowing more investments in a broader range of assets.
My experience with Fidelity brokers has been positive so far and what I have liked best is the investment research tools. I have used several other brokerage services in the past, like E-Trade, Suretrade (now defunct), Ameritrade, and others. They all offer decent research tools, but Fidelity is a little better when compared to most of these other discount brokers. The tools are extensive, and they allow investors many different ways to search for the right investment to fit the need. Maybe you want to research mid- size companies in the energy sector with PE rations below ten and with dividend yields greater than five percent. Maybe you would like to check out a list of recommended investments, selected by a group of investment professionals. Fidelity brokers offer these and many other ways to find the right investment to match your desires.
Investment research is also made easy with Fidelity brokers' company information. Not only can I research to find companies that fit specific criteria, I can also lookup financial information on specific companies. Fidelity Investments will show me just about anything I want to know, from stock closing prices over the past several years to analyst recommendations and scores, etc. Along with this stock trading data, I can also find all sorts of financial reports on a company, downloadable in PDF, that include financial statements, company valuation, dividend payout, inside ownership, etc. Basically, everything you could ever want to know about an investment in order to make an informed decision, you will find here in Fidelity.
Now, let's talk about another important factor when selecting a broker: Commission rates. Fidelity brokers are not considered discount brokers. This company is considered a moderately- priced brokerage service, falling somewhere between the very low fees charged by the discount brokers and the higher fees charged by many full- service, advice- giving brokers. Don't let the moderately high fees discourage you from considering Fidelity. It is common to find special offers from Fidelity brokers, like commission free trades for a few months or your first 50 trades commission free, or something like these offers. It was, in fact, a commission free trading period that convinced me to sign up with Fidelity Brokers in the first place.
Fidelity brokerage accounts are easy enough to use, and I often log into my account during the day to see what is gaining, what is losing, how much I have gained or lost since opening the account and/or buying new investments, etc. This account information section, however, needs to be improved somewhat to make it more intuitive. In due time, you can find what you want but it takes many clicks and too much trial and error to find some basic facts on your portfolio. For example, I can remember one day when I was trying to lookup in the Fidelity web site to see if a dividend payout had been made on a company in which I owned some common shares. It took several minutes to find where this information was hiding within the site.
Customer service with Fidelity is also very good and I appreciate the guidance they have provided and the quick responses to e-mail inquires. In some instances, Fidelity customer service reps seem a little overly cautious. They will state things over and over again, making sure you understand the risk you are getting into. It is nice that they make sure people know, but the excessive reminders make me wonder if they do this because they care, or because they are paranoid about possible lawsuits. I tend to think it's a little of both. Yes, Fidelity probably is concerned about lawsuits, but lawsuits affect many other brokerage services and others that I have dealt with over the years would not offer this important information verbally at all. They would direct you to the web site and advise you to check on risks, but they would not bother to talk about it on the phone.
Stock prices have been very volatile lately and Fidelity brokers are an investment team I am happy to have on my side. Fidelity offers very highly rated mutual funds (they consistently receive high marks from Morningstar and other rating agencies), very good research tools, and lots of financial information on every investment type imaginable. The web site could use a few improvements and the customer service could use a lesson or two in restraint, but Fidelity brokerage service is still very solid and reliable. Years of excellent mutual fund management have paved the way to a competent brokerage service that has satisfied most of my financial needs with little or no worries.