Rivalry Outline
Firstrade and Robinhood are two ultra-low-cost stock brokers that attract customers for the value
they offer. Edward Jones is the largest wealth management firm in the United States. So, which firm is the better choice? This article aims to find out.
Cost
| Broker Fees |
Stock/ETF
Commission |
Mutual Fund
Commission |
Options
Commission |
Maintenance
Fee |
Annual IRA
Fee |
|
Firstrade
|
$0
|
$0
|
$0
|
$0
|
$0
|
|
Robinhood
|
$0
|
na
|
$0
|
$0
|
$0
|
|
Edward Jones
|
$0
|
$0
|
$0
|
0.50% to 1.50% + $300
|
0.50% to 1.50% + $300
|
Edward Jones is the most expensive option among the three in this article, which is its biggest drawback. Charging $3.95 for trades, 2.5% for advisory services, and other fees, Edward Jones ensures it compensates itself well. Clients signing up for advisory services at Edward Jones should be aware of these fees as they could impact long-term returns.
Management Fees
First $250,000: 1.35%
Next $250,000: 1.30%
Next $500,000: 1.25%
Next $1,500,000: 1.00%
Next $2,500,000: 0.80%
Next $5,000,000: 0.60%
Next $10,000,000: 0.50%
Portfolio Strategy Fees
First $250,000: 0.09%
Next $250,000: 0.09%
Next $500,000: 0.08%
Next $1,500,000: 0.07%
Next $2,500,000: 0.06%
Next $5,000,000: 0.05%
Next $10,000,000: 0.0%
Trade Commissions
Up to $5,999.99: 2.50% (max fee: $150)
$6,000 to $9,999.99: 2.00% + $30 (max fee: $230)
$10,000 to $24,999.99: 1.50% + $80 (max fee: $455)
$25,000 to $99,999.99: 1% + $205 (max fee: $1,205)
$100,000 and above: 0.50% + $705 (no max fee)
Services
Promotions
Firstrade: Get up to $250 ACAT rebate and $0 commission trades.
Robinhood: Free stock up to $200 and 1% IRA match when you open an account.
Edward Jones: none right now.
Tech Tools
Trading and security research at Firstrade are conducted on its web-based platform, which does not require an active trader status. It includes advanced charting, option chains, and watchlists. The interface is user-friendly, making it accessible for beginner investors.
Robinhood's website offers limited information. It does not support trading or advanced research. Robinhood lacks a browser-based trading option, relying entirely on its mobile app, which is available on Android and Apple devices. The app's charting features are basic, with no advanced options for graph style or layout.
Firstrade also has a mobile app, which does not support Apple Watch but offers more detailed security research and sophisticated charting compared to Robinhood's. Firstrade users benefit from a paper trading feature on the app, which is rare in the industry.
Edward Jones offers limited tech tools. If a user has an advisor, there are few technical tools available. The mobile app provides basic functionality similar to their website, catering to investors who prefer a hands-off approach. Over 8 million investors have chosen Edward Jones, attracted by its simple and effective user interface.
Firstrade wins the first round.
Security Education & Research
Firstrade provides limited investment education resources on its website, including a few introductory articles and Morningstar reports on mutual funds. Despite these resources, Robinhood offers even fewer educational materials, with minimal information available on its app and website.
Edward Jones focuses heavily on educating investors, offering a comprehensive library of free educational resources on their website. These resources cover a wide range of topics from market analysis to personal finance.
Edward Jones wins in this category for its extensive educational support.
Mutual Funds and ETFs
Both firms offer trading in all exchange-traded funds. Robinhood does not offer mutual funds, while Firstrade's mutual fund screener allows investors to filter by various criteria such as returns, assets, and minimum purchase requirements. Firstrade offers 10,000 mutual funds, 3,412 of which have no load, and all are free to buy and sell.
Robinhood does not compete well in this category.
Pricing
Robinhood revolutionized the brokerage industry by offering free trades for stocks and ETFs. They compensate for this by charging fees for mailed statements ($5) and paper trade confirmations ($2), along with passing on regulatory charges to customers. They also charge $10 for trades placed over the phone.
Firstrade also offers free trades, which include stocks, mutual funds, options, and ETFs, maintaining the industry's lowest charges.
This category results in a tie between Robinhood and Firstrade.
Cash Management
Firstrade allows customers to open a hybrid investment-cash management account with a minimum balance of $25,000. This account includes checks and a Visa debit card without additional charges, although international transactions incur a 3% fee. There is no annual fee, and securities can be traded within this account.
Unlike Firstrade, Robinhood offers no such cash management services.
Edward Jones also provides hybrid accounts, along with bank deposits and other flexible money access options.
Edward Jones offers a variety of options, emphasizing the use of an advisor, which can be a drawback depending on the investor's preference. The support from a dedicated advisor can significantly enhance an investor's portfolio success.
Firstrade wins in another category.
Find a Financial Advisor
If you are looking for a professional money management service in your area, you can
find a Financial Advisor on the Wiser Advisor.
Try Wiser Advisor
Updated on 7/4/2024.
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