Vanguard built its reputation on mutual funds, and it is the world’s top provider of index funds. Merrill Edge started operations in 2010 following Bank of America's acquisition of Merrill Lynch, so it has a shorter history. Both brokerages focus on marketing to higher net worth individuals. Their relatively high transaction fees deter young investors, frequent traders, and smaller account holders.
Vanguard stuck to its roots for years, offering mutual funds and ETFs for long-term investors without providing a platform for frequent traders. It now provides a rudimentary trading platform that lacks the horsepower of competitors, such as Schwab and Ameritrade. Despite Merrill’s conservative reputation, its MarketPro active-trading platform offers robust features. However, Merrill also has a more straightforward web interface for low-frequency traders and investors.
In our 2019 Best Online Brokers Awards, Merrill Edge received awards for Best for Beginners, Best Stock Trading Apps, Best for Roth IRAs, Best for IRAs, and Best Web Trading Platforms.
Vanguard received an award for Best for ETFs.
- Account Minimums: $0
- Fees: $0 per stock trade. Options trades $0 per leg plus $0.65 per contract
- Account Minimum: $0
- Fees: $0/stock and ETF trade, $0 plus $1 per contract for options
Merrill Edge presents step-by-step trading and investment guidance for self-directed customers through easy to navigate online and mobile interfaces. The Java-based MarketPro platform provides active traders with more sophisticated features. MarketPro includes market analysis, global research, interactive charting, pattern recognition, and a fully customizable dashboard. Traders can build watch lists, access more than 70 studies, set alerts, and monitor their portfolios in real-time.
Vanguard actively discourages short-term trading, and a generally poor trading experience reflects that philosophy. The site is challenging to navigate and is obviously not a priority for the company. They don't even have streaming quotes. Their trading technology is also limited. Vanguard's order router seeks out price improvement rather than speed, and their statistics put them in the middle of the pack. They do not accept payment for order flow for equity orders.
- MarketPro platform offers powerful tools for traders
- Integrate with your other Merrill or Bank of America accounts
- Site is easy to navigate
- No streaming quotes
- Limited trading and charting tools
- Order router seeks out price improvement rather than speed
Mobile and Emerging Tech
You can add a Merrill Edge widget to the iOS notification center, and log into the app with a fingerprint. Quotes stream across all mobile platforms. Both iOS and Android devices can access Bank of America / Merrill Lynch research reports. You can initiate a trade on your smartwatch, though you have to finish the process on the mobile app or website.
Vanguard offers mobile apps for iOS, Android, and Kindle Fire devices. The layout is actually much nicer and easier to use than the website. They added mobile check deposit in the last year. Quotes, however, are delayed.
- Log in to the mobile app with fingerprint
- Excellent overall mobile experience
- Mobile access to research reports
- Mobile apps are much easier to use than the website
- Mobile check deposit available
News and Research
Merrill Edge offers impressive resources, which include market data, news, and independent research. Merrill Edge has a searchable database of reports for approximately 1,500 equities covering the past six months. You can also read the quarterly Fixed Income Digest if you are a bond investor. You can dive into quantitative research and data on emerging markets. Information on individual equities can be viewed in the Stock Story feature, which pulls in data from dozens of sources and highlights impact investing.
Vanguard’s News & Perspective section highlights macroeconomic and retirement planning but lacks comprehensive market commentary. There is also a Vanguard Blog that discusses general interest themes. Options research is limited to looking at options chains, which are significantly less informative than chains on other broker sites. Charting is extremely basic and includes no customization or technical studies.
- Massive library of proprietary research and stock rankings
- Excellent research resources for individual stocks, bonds, and emerging markets
- News and research are very basic
- Focused on general interest and index investing
Education and Security
Merrill offers a variety of on-demand webinars covering key financial topics. A dedicated educational section is arranged by experience level, with beginner, intermediate, and advanced tiers covering topics in personal finance, stocks, and options. Educational materials also include more detailed coverage of annuities, fixed income, and mutual funds. Merrill Edge uses industry-standard encryption for all accounts and offers SafePass for enhanced security.
Education offerings at Vanguard are fairly basic, and they are aimed at very long-term investing. They also host occasional webinars that focus on the long term. In the security department, Vanguard supports YubiKey for hardware-based two-factor authentication.
- Investor education through articles and an online classroom setting
- Skill-level specific resources ranging from beginner to advanced
- Focused on mutual funds and ETFs
- In-depth index investing
- YubiKey for hardware-based two-factor authentication
Merrill stock and ETF trades cost $0, while options cost $0 plus $0.65 per contract. .
Vanguard charges nearly identical commissions, $7.00 for stocks and $7.00 + $1.00 per options contract for accounts up to $499,999. Commissions drop to $2.00 for accounts above $500,000 and to zero for limited trades between $1,000,000 and $5,000,000. Neither broker offers futures, commodities, or currencies.
Investopedia is dedicated to providing investors with unbiased, comprehensive reviews and ratings of online brokers. Our reviews are the result of six months of evaluating all aspects of an online broker’s platform, including the user experience, the quality of trade executions, the products available on their platforms, costs and fees, security, the mobile experience and customer service. We established a rating scale based on our criteria, collecting over 3,000 data points that we weighed into our star scoring system.
In addition, every broker we surveyed was required to fill out a 320-point survey about all aspects of their platform that we used in our testing. Many of the online brokers we evaluated provided us with in-person demonstrations of their platforms at our offices.
Our team of industry experts, led by Theresa W. Carey, conducted our reviews and developed this best-in-industry methodology for ranking online investing platforms for users at all levels. Click here to read our full methodology.