Wells Fargo was founded in 1852—amidst the California Gold Rush—and has since grown to become the nation's third-largest bank, behind only Bank of America and JPMorgan Chase & Co. During the late 2010s, the company was mired in a long list of costly scandals, including those involving fake customer accounts, discriminatory lending practices, securities fraud, auto loans, and mortgages. As a result, the company paid out billions in fines and restitution.
Today, Wells Fargo is working to restore its image and regain trust by focusing on technology improvements and customer service. The company offers various financial products, including banking, credit cards, insurance, mortgage loans, wealth management, and brokerage services. Its brokerage division, WellsTrade, is intended to serve Wells Fargo Bank customers who want the convenience of managing their investments at the same institution where they have checking accounts and mortgages.
WellsTrade was late to the zero-commission game but finally joined the pack in December 2019, dropping commissions for listed stocks and ETFs to $0. Investors who prioritize analyst research and sell-side recommendations may also find what they are looking for at WellsTrade. However, in both cases, active investors looking for low costs and high-quality tools will be disappointed by what WellsTrade has to offer.
- WellsTrade is likely the best fit for existing Wells Fargo Bank customers who can benefit by having more financial accounts with a single provider.
- WellsTrade offers zero-commission trades for listed stocks and ETFs; penny stocks incur a commission.
- Customers of WellsTrade get access to Wells Fargo proprietary research.
- All of a WellsTrade customer’s Wells Fargo accounts will appear in one place on the website and app.
Who WellsTrade is For
WellsTrade is designed for infrequent, buy-and-hold investors who are focused on equities. WellsTrade customers can trade stocks, ETFs, mutual funds, fixed income, and single-leg options. It might be a good fit if you're a U.S. resident who already does business with Wells Fargo, whether that's through a bank account or mortgage. One advantage to having an investing account if you already have accounts with Wells Fargo is that it's simple to move money from one account to another.
No commissions for stock and ETF trades
Easy-to-use website and mobile app
A single app gives you access to all Wells Fargo accounts
Limited research offerings outside of proprietary Wells Fargo analysis
Households with under $250,000 in WellsTrade accounts may pay a $30 annual fee
Quotes do not stream
- Like most brokers today, WellsTrade offers $0 online stock and ETF trades (excluding penny stocks). Keep in mind that if you place a stock or ETF trade over the phone, a $25 agent-assisted trading fee will apply.
- The website and mobile apps are simple to navigate and appear very similar, so switching between the two platforms is easy.
- You can manage all your Wells Fargo accounts from a single website or app. This "one app to rule them all" can be a handy way to keep track of your finances.
- Though the Wells Fargo proprietary research offerings are worth considering, there is very little else available. Screeners are limited, and there is no options analysis at all.
- The $30 annual fee applies to households with less than $250,000 in WellsTrade accounts. You can avoid the fee by enrolling in electronic statements and confirmations or by linking to the Portfolio by Wells Fargo program.
- Streaming real-time quotes are not available. When you first bring up a quote, it displays in real-time, but you have to refresh the page to update the price manually. This extra step can make it difficult to gauge market movements.
Getting started with a new account is relatively simple. You can sign up for a standard (brokerage), Traditional IRA, or Roth IRA account on the WellsTrade website or mobile app. Most applicants can provide their signatures electronically; however, you may have to print out some forms and mail them in—which will delay the opening of your account.
If you already have a relationship with Wells Fargo, your personal details automatically populate the application, which can be a time saver. There are a few extra hoops to jump through if you want to trade options or use margin. One upside to using a bank-based online broker is the ease of moving cash from one account to another, both on the browser and mobile app.
The web-based platform is easy enough to navigate, but it's very slow. Most account functions, research tools, and order entry appear under two-level menus. When you first log in, you will see an overview of your brokerage account with balances and a chart that shows your asset allocation. You can set up account groups and change out the data displayed on your portfolio listing—but that's about it for customization.
You have to make a few clicks or taps on the menus to open an order ticket. The mobile app is essentially the same experience as the web version, scaled to fit the device.
You can enter orders for stocks, single-leg options, ETFs, and mutual funds very easily. WellsTrade does not offer conditional order types such as one-triggers-another, but you can use standard limit, market, and stop orders. The order entry process is simple, but it takes a while to navigate from one page to the next, which could become tedious (and impractical) for active investors. It's possible to start an order from watchlists or screener results, and you can make tax lot choices while entering orders.
Single-leg option orders can be entered online, but not multi-leg positions. You'll have to make a separate transaction to create a covered call or protective put when opening a long stock position. If you're a regular spread trader, this is not the broker for you as you will have to call a broker to make those trades as a single order. In addition to the inconvenience, those calls can get pricey quick. There is a $25 additional fee to place an order through a live broker.
Mobile Trade Experience
Placing a trade on a mobile device is very similar to the web order entry experience. To close a position and avoid making errors, it's a good idea (especially on mobile) to start from your “Positions'' page and then tap on the “Trade” link.
Range of Offerings
WellsTrade supports a limited range of asset classes. There's no access to fractional shares, futures, futures options, crypto, or forex trading. For passive investors, there is a wide selection of no-transaction-fee mutual funds and a decent mutual fund screening tool.
- Stocks long and short (1,200+ on the "easy to borrow" list)
- OTCBB (pink sheets)
- Mutual funds (3,800+ total, about 2,000 no-transaction-fee)
- Bonds (secondary market in corporates, treasuries, munis, and CDs); available via agent only
- Single-leg options (limited number of spreads available via a live broker)
- Robo-advisory, Intuitive Investor, integrated into website and app
WellsTrade is not the broker for you if you require advanced order types. You can only place market, limit, or stop-limit orders online. There are no conditional orders available, and you can't place trailing stop orders. Market-on-open and market-on-close orders can be placed only with the assistance of a live broker (which triggers a $25 fee).
WellsTrade does not characterize its order router as "smart" but manages to attain about $0.01 per share in price improvement on equity orders. WellsTrade does not accept payment for order flow for marketable equity orders. However, the company reports $0.15 per contract in payment for order flow on options orders, which is below the industry average.
WellsTrade does not support backtesting or automated trading.
WellsTrade's commissions are mostly in line with the industry. There are two notable exceptions: the high fee for trading penny stocks and the base fee for trading options.
- Cost to open or close an order of one share priced at $1 or greater is $0. Cost to open or close 1,000 shares is $0.
- Cost to open or close any trade of a stock or ETF priced less than $1 per share is the greater of $34.95 or 3.5% of principal.
- Options base commission to open and close is $5.95.
- Options per contract fee is $0.75.
- Fee for 50 contracts is $43.45.
- Covered call trade of 500 shares plus five contracts is $9.70 and is two separate transactions.
- Options exercise/assignment fee is $25 and must be done via live broker.
- Mutual fund fee for those not on no-transaction-fee list is $35.
- Margin interest at $10,000 balance is 9%. $100,000 balance is 7.5%. These fees are above the industry average.
- Inactivity fee is $30 per year for households with balances below $250,000.
- No account closure fee. Termination fee for IRAs if the account holder is younger than 70 ½ is $95.
- Account transfer fee is $95.
- Wire fees are $30 domestic, $40 international.
- Check fees are $0 unless overnight delivery is requested, then the fee is $15.
- Paper trade confirmations or account statements are $20.
- Live broker fee is $25 in addition to online fees.
How This Broker Makes Money From You and for You
With fewer brokerages charging commissions these days, it's less obvious how they stay in business. Here are some behind-the-scenes ways WellsTrade makes money from you.
- Interest on cash balances: Like many brokerages, WellsTrade earns interest on customer cash balances. Customers are automatically enrolled in cash sweep programs, but the interest earned is just 0.01%. Depending on interest rates, it may be a good idea to open a Wells Fargo Bank account and move uninvested cash to an interest-earning account or money market fund.
- Stock program: WellsTrade earns revenue by loaning stocks in your account for short sales. Unlike some brokerages, it does not share any portion of that revenue with you.
- Payment for order flow: Some brokers earn money by accepting payments from market makers for directing equity and options orders to them—a practice called payment for order flow (PFOF). WellsTrade accepts an average of $0.15 in payment for order flow on options orders; it does not accept PFOF on marketable stock and ETF orders.
- Price improvement: WellsTrade reports a per-share price improvement of $0.0101 on eligible equity orders and a per contract price improvement of $9.65 on eligible options orders.
- Portfolio margining: Portfolio margining computes real-time margin for stock and options trades based on risk instead of fixed percentages. WellsTrade does not currently offer portfolio margining.
Account and Account Amenities
WellsTrade offers many of the account and research amenities you would expect from a large broker, including screeners, market news, and research reports.
Stock and ETF Screeners
The landing page for asset screening lets you look for stocks, ETFs, mutual funds, and bonds. The screeners have limited functionality, but you can create a trade ticket from the search results list. The company doesn't offer any preset screens, so you must make your own. It's possible to screen based on technical and fundamental indicators, and you can save a screen for future use.
Mutual Fund Screener
You can compare up to three mutual funds with WellsTrade's mutual fund screening tool. It's possible to search mutual funds—but not stocks or ETFs—for socially responsible investments. WellsTrade offers a recommended list for mutual funds, which is updated regularly.
WellsTrade does not offer an options screener.
Fixed Income Screener
The bond screener allows you to search through the available inventory for a bond that fits your specific needs, but you must place trades with a live broker. The screener supports munis, corporates, agencies, CDs, and Treasuries.
Tools and Calculators
You won't find any trade-specific tools and calculators. Still, WellsTrade customers have access to the “My Retirement Plan” savings calculator, which lets you check where you are today, see where you're headed, and get the steps and guidance.
Trading Idea Generator
WellsTrade offers a curated list of trades and securities screened by Wells Fargo Advisors research analysts.
Market news is provided by Reuters, and most of the research is created by internal Wells Fargo analysts. The news is real-time but not streaming, which means you have to refresh the list manually.
The research reports, market commentary, and investment recommendations are above average compared to the industry. Investors focused on long-term holdings will likely appreciate access to much of the sell-side research provided by WellsTrade. You can follow a specific Wells Fargo analyst if you find one that fits your investing profile. Customers also have access to market reports from WF Investment Institute (WFII), WFA Commentary Reports, WF Securities, and Morningstar.
The charting functionality on WellsTrade is very basic compared to what many platforms offer today. You can choose a chart type (mountain, OHLC, candlestick, filled candles, line, bar, and dot) and select from about 30 technical studies. The charting features may be adequate for buy-and-hold investors, but more frequent investors will be disappointed.
You can earn a return on uninvested cash balances in your account with WellsTrade's sweep feature. There are three ways to earn a return: the standard bank deposit sweep, expanded bank deposit sweep, and a money market fund sweep. Eligibility is based on the type of investment account and the nature of account ownership.
DRIP (Dividend Reinvestment)
WellsTrade offers a dividend reinvestment plan, and you can reinvest some or all your cash dividends. You can enroll online or by calling customer service and requesting an enrollment kit.
SRI/ESG Research Amenities
WellsTrade customers can screen based on socially responsible investing (SRI) and environmental, social, and governance (ESG) factors via Morningstar.
The WellsTrade portfolio analysis tools are surprisingly robust. Investors can see charts, wheels, and tables that break down portfolio holdings by asset class. Performance reports are easy to access and very detailed, and you can customize them to show a particular period. The account landing page presents a view of the entire household, which you can customize as desired. You can customize the portfolio and define up to five different views, as well.
The asset allocation wheel lets you compare your portfolio to a variety of asset allocation models. There's a to-do list available that tells you what transactions you'd have to make to match your desired allocation model.
Still, some important portfolio analysis tools are missing from the WellsTrade lineup. You can't consolidate accounts from other financial providers to see a complete financial picture. Also, you can't estimate the tax impact of a proposed trade, and there are no tax reporting tools. The platform also lacks a trading journal.
WellsTrade’s educational offerings are light to nonexistent, outside of FAQ pages, a glossary, and other brief snippets. There are no videos, no webinars, and the articles are short and lacking detail. New investors who struggle with basic concepts won't find much help. There's little help for navigating the WellsTrade platform and tools. For example, investors with limited experience screening for stocks may have trouble navigating the screening tools on their own.
Life planning tools on the Wells Fargo Advisors site cover marriage, job changes, divorce, and the like. The Retirement Center includes tips for planning for—and living in—retirement. Some educational content is included with the retirement planning tool, but it lacks any real depth. WellsTrade seems to focus mainly on clients who rely on advisors to help them with their questions.
- Phone line available 24/7.
- No online chat capabilities.
- Live brokers are available during market hours.
- The average hold time is less than one minute.
- Clients are strongly encouraged to work with a financial advisor.
- Wells Fargo accepts only U.S. residents and citizens as clients.
Security and Reliability
- 2-Step verification lets you activate an additional layer of security when you access your accounts online by entering a unique Advanced Access verification code sent to your mobile device or phone or from an RSA SecurID device.
- Biometric entry enabled for mobile apps.
- Excess Securities Investor Protection Corporation (SIPC) insurance carried by London Underwriters up to an aggregate limit of $1 billion (including up to $1.9 million for cash per client).
- Wells Fargo / WellsTrade has had several well-publicized data breaches over the years. The Identity Theft Research Center reported several minor breaches during 2020 and 2021 in which sensitive records were exposed.
It's reasonably easy to find information about pricing, commissions, service fees, and margin rates on the Wells Fargo website (you have to get to the WellsTrade page and scroll down to “Pricing''). From there, you can click on the “WellsTrade Brokerage Commissions and Fee” page, which explains everything in detail.
As mentioned, Wells Fargo was at the center of a long list of costly scandals in the late 2010s, including those involving fake customer accounts, discriminatory lending practices, securities fraud, auto loans, and mortgages. In April 2018, Wells Fargo, the Consumer Financial Protection Bureau (CFPB), and the Office of the Comptroller of the Currency (OCC) reached a $1 billion settlement for mortgage lock and auto-loan issues. The company paid out $2.1 billion for its role in the housing bubble just four months later. Since then, the company has had several minor data breaches that exposed the sensitive records of a relatively small number of customers.
WellsTrade is tightly integrated with Wells Fargo's banking and wealth-management services. If that's of value to you—or if it offers the convenience you're looking for—you might consider opening an account here. Otherwise, the limited tools and lack of education are unlikely to be attractive to most investors. Wells Fargo's persistent security problems, which have appeared to be under control during the last year or so, may also affect WellsTrade customers in the future.
That said, WellsTrade might be of value if you're a fan of Wells Fargo's analysis and research. The firm's internal analysts provide buy-and-sell recommendations and detailed analysis that you can access on the WellsTrade platform. The better-than-average research, good telephone support, and integration with other Wells Fargo accounts may be worth the disadvantages for the right investor. For most investors without a prior relationship with Wells Fargo, other brokers likely have a lot more to offer.
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