Merrill Edge is the better brokerage platform overall
By
Samuel Deane
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Full Bio
Samuel Deane is the founder and financial advisor at Deane Wealth Management, a registered investment advisory firm for Millennials in tech. He has taught personal finance as an adjunct professor at Baruch College. And he is a consultant for and contributor to several national publications, writing about personal finance for Millenials, investing, equity compensation, tax planning, and practice management for financial advisors.
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Updated June 03, 2024
Reviewed by
Samantha Silberstein
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Reviewed bySamantha Silberstein
Full Bio
Samantha (Sam) Silberstein, CFP®, CSLP®, EA, is an experienced financial consultant. She has a demonstrated history of working in both institutional and retail environments, from broker-dealers to RIAs. She is a current CFA level 3 candidate and also has her FINRA Series 7 and 63 licenses. Throughout her career, Samantha has used her expertise and various licenses and certifications to provide in-depth advice about household and business-specific financial planning, investing, credit cards, debt, student loans, taxes, retirement, and income strategies.
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Fact checked byFernando Flores
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Overview
Both Merrill Edge and Vanguard are full-service brokers that have been around for some time. Vanguard, founded in 1983, has successfully built a reputation serving buy-and-hold investors with a passive and long-term philosophy. It has since become synonymous with low-cost investment. Vanguard continues to deepen its asset pools by expanding its offerings in ways that align with its low-cost, passive principles. In 2024, it began offering an additional cash management option with Vanguard Cash Plus, which has higher FDIC coverage, a high interest rate, and the ability to make bill payments.
A bit newer to the online brokerage scene is Merrill Edge, which can have a similar target audience to Vanguard. Merrill Edge was launched in 2010, following Bank of America’s (BoA) acquisition of Merrill Lynch. Considering this, one of Merrill’s advantages is that it is seamlessly integrated with BoA’s banking experience. Merrill Edge has been streamlining some parts of its user experience and increasing its educational content, but it also maintains a trading-focused desktop platform. Although both brokers are mainly built for beginner and DIY investors, we’ll look at some of the key differences to help you determine which one is the right fit for your investment needs.
- Account Minimums: $0
- Fees: $0 per stock trade. Options trades $0 per leg plus $0.65 per contract
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- Account Minimum: $0
- Fees: $0/stock and ETF trade, $0 plus $1 per contract for options
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Merrill Edge
Pros
Quick and simple usability
Straightforward and intuitive trade experience
Smart order router capabilities
Full charting and customization tools
Complete portfolio breakdown visibility
Dedicated investor education programs
24/7 customer support
Soft token and high-risk trade authorization security
Cons
Basic/limited range of offerings
Fees are on the costlier side
No fractional share trading
Vanguard
Pros
Strong focus on serving buy-and-hold investors
Minimal fees
Real-time updates to portfolio reports and analysis
A wide array of educational resources
Life stage planning tools
Fractional shares
Cons
Lengthy onboarding process
Basic order routing technology
Limited customization options
No 24/7 phone, online chat, or live broker support
Merrill Edge vs. Vanguard: Usability
Merrill Edge and Vanguard are vastly different when it comes to the look, feel, and functionality of their platforms. Getting started with Merrill is quick and simple, especially if you’re a Bank of America customer.
On the other hand, the onboarding process with Vanguard is rather lengthy. You will be able to initiate opening an account online, but there is a wait of several days before you can log in and view your account. Vanguard has made updates to its platform, and you can customize it according to your interests, but it is still far from the experience an active trader might be seeking. In terms of serving its target buy-and-hold investors, it gets the job done with some improved navigation.
Usability Verdict: Merrill Edge
Overall, Merrill Edge is sleeker and makes finding tools and resources easy. Though the website is not customizable, you can customize the layout and set trading defaults in its MarketPro online trading platform. When it comes to usability, Merrill Edge has a significant advantage over Vanguard.
Merrill Edge vs. Vanguard: Trade Experience
Desktop Trade Experience
Similar to the platform itself, the Vanguard trading experience has improved but is not aimed at serving the needs of more active traders. All pages that involve trading utilize real-time quotes, as do its security profile and research pages. However, market and security information on the website display delayed quotes. Rather than auto-refreshing, the quotes update as you move through a trade flow, which may take several clicks before placing a trade order.
Overall, the trading experience is sufficient for the buy-and-hold investors Vanguard targets, allowing them to slowly put together a portfolio. For other types of investors who are expecting a responsive and customizable platform, Vanguard’s trading experience predictably falls short.
The trading experience on Merrill’s platform is a significant improvement over Vanguard's because it is straightforward and intuitive. MarketPro provides streaming real-time quotes that you can view on multiple devices simultaneously. You can also stage orders for later entry and enter multiple orders simultaneously.
MarketPro’s chart trading interface is less elegant than what you may find on some other trading platforms, but it still gets the job done. This is particularly true for retail traders with less complex needs.
Desktop Trade Experience Verdict: Merrill Edge
Both Vanguard and Merrill have trading experiences that align with new investors' needs, but we think Merrill has an advantage over Vanguard in this category because it has the capabilities to serve a crowd that's more diverse than just buy-and-hold investors.
Mobile Experience
When it comes to mobile trading, there is a similar gap between the types of investors Vanguard and Merrill are looking to serve. As with its website, quotes in the Vanguard app for stocks and ETFs show a delayed price until you get to order entry. The Vanguard app does allow you to customize your feed, which displays account information, news, blogs, transaction history, and performance, among other information. No other data, such as the day's change or volume, is displayed in the mobile view, and there is also a complete lack of charting on Vanguard's mobile app.
The Merrill Edge app is more robust and customizable than Vanguard’s, mirroring many of the tools on Merrill’s richer desktop platform. One downside to the Merrill Edge mobile experience is that you cannot customize many features. The mobile app doesn't support chart trading, but you can click the “Trade” icon in the chart header, which prefills the order ticket with the symbol information.
As far as similarities, both Vanguard and Merrill Edge have limited capabilities as they pertain to entering multiple orders simultaneously and enabling conditional orders.
Mobile Experience Verdict: Merrill Edge
Merrill Edge’s app is more robust than Vanguard’s, giving Merrill the advantage in this category as well.
Merrill Edge vs. Vanguard: Range of Offerings
Both Vanguard and Merrill Edge have a similar range of offerings. Most investors will find what they need among the stocks, bonds, and funds, but traders and more sophisticated investors will find the overall selection of both brokers limited, with no futures, cryptocurrencies, and so on.
Range of Offerings Verdict: Vanguard
While neither broker has an obvious advantage over the other in this category, we give Vanguard the edge. Vanguard has a deeper pool of assets and continually grows its low-fee fund lines as well as access to new issues of bonds from an ever-expanding selection of banks. Vanguard also allows you to get more money into investments due to the availability of fractional shares. Merrill Edge lacks fractional shares.
Compare Range of Offerings
| Criteria | Vanguard | Merrill |
|---|---|---|
| Short Sales | Yes | Yes |
| # of No-Load Mutual Funds | 191 Vanguard funds, 9,951 third party | 2720 |
| Assets Available to Trade on Website | Stocks, Mutual Funds, ETFs, Bonds, CDs, Options | Stocks, Mutual funds, ETFs, Bonds, CD's, Options, OTC |
| Assets Available to Trade on Desktop Software | N/A | Stocks, Mutual funds, ETFs, Bonds, CD's, Options, OTC |
| Assets Available to Trade on Mobile | Stocks, Vanguard Mutual Funds, ETFs | Stocks, Mutual funds, ETFs, Bonds, CD's, Options, OTC |
| Max # of Options Legs | 2 | 4 |
| Robo Advisory | Yes | Yes |
| # of International Exchanges | None | None |
| Fractional Share Trading | Yes | No |
| Fractional Dividend Reinvestments | Yes | Yes |
Merrill Edge vs. Vanguard: Order Types
Vanguard’s ethos centers on a long-term investing philosophy, so the broker’s range of order types is limited to those best suited for buy-and-hold investors. The only order types you can place are market, limit, and stop-limit orders.
Similarly, Merrill Edge supports basic order types, including market, limit, stop limit, and trailing stop orders across all platforms, but it doesn't offer the advanced conditional orders that active traders want. Both brokers allow you to select tax lots when closing out a position.
Order Types Verdict: Tie
When it comes to order types, neither broker has a clear edge over the other.
Merrill Edge vs. Vanguard: Trading Technology
Vanguard's order routing technology is basic, just like its trading platform. It does not have smart order routing technology, you cannot backtest or automate a trading strategy, and you cannot route your own orders. The broker reports price improvement on stock orders of $1.70 for a 100-share order compared to the National Best Bid and Offer in 2023.
In comparison, Merrill Edge uses the Bank of America Merrill Lynch (BofAML) smart order router, which fills orders by first seeking price improvement rather than execution speed. Merrill’s average execution speed for market orders sized 100 to 1,999 for S&P 500 stocks is .007 seconds. For the same time period and order size, the broker promotes 99.12% of orders executed at or better than the quoted price as well as an average savings of $16.80 per order of 1,000 shares.
Trading Technology Verdict: Merrill Edge
Vanguard is very slightly better at $1.70 per 100-share order (Merrill Edge is equivalent to $1.68 per 100-share order). Both brokers also deserve kudos for not accepting payment for order flow from market makers. Overall, we found that Merrill’s platform has a slight edge over Vanguard as it pertains to trading technology and speed.
Merrill Edge vs. Vanguard: Costs
Like many brokers, both Merrill Edge and Vanguard charge no commissions on stock and ETF trades. Additionally, there are also no per-leg commission options trades. Per-contract commissions are $0.65 at Merrill and $1 at Vanguard. This means an order for 50 options contracts is $50 at Vanguard, while the same order is $32.50 at Merrill Edge.
The above makes sense because Vanguard’s ideal customer has a passive, long-term investment philosophy that isn’t likely to include much options trading. While both brokers have no fees for inactivity, checks, or paper statements and trade confirmations, Merrill charges an account closure fee of $75 for retirement accounts; Vanguard charges $100 for the closure or transfer of an account Additionally, Vanguard charges a $10 wire fee for both domestic and international wires. Sending a wire with Merrill Edge will vary; outgoing domestic and international wire fees will cost $30 for each wire request.
Costs Verdict: Vanguard
Overall, both brokers have low-cost offerings, but Vanguard has a clear advantage in this category as long as you’re not a frequent options trader.
Compare Costs
| Vanguard | Merrill | |
|---|---|---|
| Volume-Based Options Discounts (Upon Meeting a Threshold) | No | No |
| Recurring Investment Fees | Yes | No |
| Options Price Cap (Upon Meeting a Threshold) | Yes | No |
| Option for No Base Commission for Trading Penny Stocks | Yes | Yes |
| Option for No Base Commission for Stocks and ETFs | Yes | Yes |
| Inactivity Fees | No | No |
| Cost Per Stock Trade | $0.00 | $0.00 |
| Cost Per Options Contract | $1.00 | $0.65 |
| Cost Per Futures Contract | N/A | N/A |
| Broker-Assisted Trade Fee | $25.00 | $29.95 |
| Base Commission for Options | No | No |
| Account Closure Fees | No | Yes |
| Number of No-Load Mutual Funds Without Transaction Fees | 3,458 | 2,198 |
Merrill Edge vs. Vanguard: Account and Research Amenities
Although Vanguard is a large broker, it has more limited research and account amenities than one would expect from a large broker. This is because Vanguard was built for the buy-and-hold investor. Both brokers offer a dividend-reinvestment plan (DRIP) program, and here Merrill Edge uses fractional shares but not elsewhere.
In contrast, Merrill Edge has excellent fundamental research tools, including an impressive collection of proprietary and third-party research and stock rankings. Although both brokers have stock screeners, Vanguard’s platform will not allow you to screen for technical indicators, and you cannot turn screens into a watchlist. Moreover, Merrill Edge has an options screener as well as a strategy builder, while Vanguard does not offer an options-specific screening tool.
Although Vanguard’s charts are customizable, there is no technical analysis available, and customization is limited. Merrill Edge’s MarketPro offers full charting and customization capabilities with streaming real-time data. Both Merrill’s web and mobile platforms have limited charting capabilities that are enough for casual, long-term investors to trade on the go.
Account and Research Amenities Verdict: Merrill Edge
Overall, Merrill Edge has a substantially better offering than Vanguard because it also includes news from multiple sources, a trade idea generator, robust third-party research, and more. You can still strengthen your financial toolbox with plenty of do-it-yourself resources at Vanguard, but the majority of this broker's tools center around retirement planning.
Compare Account and Research Amenities
| Vanguard | Merrill | |
|---|---|---|
| Portfolio Margin Available | No | No |
| Ability to Choose and Offer Shares Held Long to a Loan Program | No | No |
| Interest Earned on Uninvested Cash | Varies | 0.01% |
| Uninvested Cash Automatically Swept into a Money Market Fund | Yes | No |
| Screeners Offered | Stocks, Preferred stocks, ETFs, Mutual Funds, Fixed Income (ETF and mutual fund screeners contain filters for ESG strategies) | Stocks, ETF's Options, Mutual Funds, Fixed income |
| Ability to Build Custom Screen | Yes | Yes |
| Ability to Screen Based on Technical Indicators | No | Yes |
| Ability to Save Custom Screens | Yes | Yes |
| Access to Proprietary Research | Yes - with no additional cost | Yes - with no additional cost |
| Access to Third Party Research | Yes - with no additional cost | Yes |
| Ability to Turn Screen Results Into a Watchlist | No | Yes |
| Trading Idea Generator Offered | N/A | Yes - Via Idea Builder which provides over 100 thematic investment ideas |
| Daily Market Research Reports Offered | Yes | Yes |
| Types of Charts Offered (Ex: Line | Mountain, Line, OHLC, Candlestick | OHLC, HLC, Bar, Candlestick, Heikin-ashi, Line, Dot, Square, Histogram |
Merrill Edge vs. Vanguard: Portfolio Analysis
Similar to its account and research amenities, Merrill’s portfolio analysis capabilities are exceptional. Merrill’s Portfolio Story is a proprietary tool that shows a complete breakdown of your portfolio, not only by sectors and holdings but also by performance, analyst ratings, and MSCI ESG scores. It's a valuable piece of portfolio analysis technology and should be especially helpful to new investors. Merrill Edge also has Stock Story and Fund Story tools to help you leverage the analysis available at Merrill when assessing investments.
Vanguard's portfolio reports and analysis aren't as robust, but they are updated in real time on the Vanguard website. Reports are also customizable and you will have the ability to aggregate holdings from outside accounts. Vanguard has made improvements with a better client dashboard and updates to its tools. Both platforms lack trade journals as well as the ability to calculate the tax impact of a future trade.
Portfolio Analysis Verdict: Merrill Edge
Overall, Merrill Edge has a much better portfolio analysis offering than Vanguard.
Merrill Edge vs. Vanguard: Education
Both Vanguard and Merrill Edge provide educational resources for their customers. The focus of Vanguard's content is on helping you set financial goals and create a plan of action on how to reach them. In addition to blogs, articles, webcasts, and other educational resources, Vanguard also offers life-stage planning tools that are useful for do-it-yourself and beginner investors.
With Merrill Edge's investor education, you can pick an investing experience level or a topic—such as investing and markets, stocks, ETFs, options, mutual funds, margin, and others. You can also learn about various investment topics through a series of courses that go from basic to more sophisticated strategies. Merrill Edge uses a narrative approach to a lot of its education, packaging it up into a story-type journey to help you pick up knowledge on investing and how to leverage the tools available through Merrill Edge at the same time.
Education Verdict: Merrill Edge
Although both Merrill and Vanguard offer a solid education, we found Merrill to be the better choice in terms of education due to its wider selection of topics and deeper dives into them.
Merrill Edge vs. Vanguard: Customer Service
Vanguard’s customer service is lacking when compared to Merrill Edge. It does not have 24/7 phone support or online chat, and you cannot speak with a live broker. Moreover, you will only have access to a financial advisor if you are a Vanguard Personal Services Advisor client. Merrill Edge has 24/7 phone support, online chat, and the added ability to get in-person support at most Bank of America branches.
Customer Service Verdict: Merrill Edge
When it comes to customer service, Merrill Edge has a strong advantage over Vanguard.
Merrill Edge vs. Vanguard: Security
Although both brokers have security features in common, Merrill has an advantage over Vanguard in this category because of its additional features, including a soft token for login and high-risk trade authorization that is available through text, phone, and email. On top of all this, Merrill Edge has an aggregate loss limit of $1 billion, while Vanguard does not list its aggregate loss limit online.
Security Verdict: Merrill Edge
While both of these brokers are up to industry standards and have robust protocols in place to prevent bad actors from getting at your money, we give Merrill Edge this category for going above and beyond.
Available Account Types
Merrill Edge and Vanguard both provide commonly used account types, including:
- Individual and joint brokerage
- Custodial
- Trust
- Estate
- Rollover, Roth, simplified employee pension (SEP), SIMPLE, and traditional individual retirement accounts (IRAs)
- 529 plan
- Corporate
Available Account Types Verdict: Tie
Vanguard has a few additional accounts, like an individual and small plan 401(k) as well as Uniform Gifts to Minors Act (UGMA) and Uniform Transfers to Minors Act (UTMA) accounts. Unless you are after those specific accounts, however, either broker has the account types needed to serve the needs of most investors.
The Bottom Line
It is important to note again that neither Merrill Edge nor Vanguard is built to serve the needs of active traders. We recommend Merrill Edge in most situations because of its advantages as a more diverse broker. If you're already a Bank of America customer, choosing Merrill Edge may be a no-brainer, as Merrill Edge seamlessly integrates with the banking experience. Even many investors who are not BoA customers will enjoy Merrill’s proprietary and robust third-party research and portfolio analysis tools.
Compared to Vanguard, Merrill Edge’s platform is more intuitive when it comes to the trading experience and it offers more account and research amenities that would be valuable to investors of all experience levels.
Merrill Edge also outperforms Vanguard when it comes to security, trading technology, education, and customer service. All things considered, we found Merrill Edge to be the better overall brokerage platform for most investors. The one exception, however, is if you are looking to be a buy-and-hold investor. If that is the case, Vanguard can be a more cost-efficient broker to do this with, despite the lack of bells and whistles on its platform.
The main reason Vanguard continues to own the buy-and-hold niche is that it focuses only on what a buy-and-hold investor needs, avoiding any unnecessary expenses that would ultimately be passed on to investors.
What Are Merrill Edge and Vanguard?
Both Merrill Edge and Vanguard are full-service brokers. They have become synonymous with low-cost investment and more or less share a target audience.
How Do Merrill Edge and Vanguard Work?
Both Merrill Edge and Vanguard serve buy-and-hold investors with a passive and long-term philosophy. They do this through a variety of tools and account types, including traditional and Roth IRAs, 529 plans, and 401(k)s. They also both provide portfolio analysis and educational services geared toward strengthening their account holders' understanding and knowledge of investment systems.
Who Should Use Merrill Edge vs. Vanguard?
Most investors should use Merrill Edge as opposed to Vanguard. It is a more diverse broker and offers more amenities that investors of all experience levels will find valuable. The only exception is if you are a buy-and-hold investor, which Vanguard focuses on servicing almost exclusively.
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Vanguard. "Your Cash Deserves a Good Home."
Vanguard. "Brokerage Built for You."
Merrill Edge. "Execution Quality."
Merrill Edge. "Sometimes, You Get More Than You Pay For."
Vanguard. "Brokerage Services Commission & Fee Schedules."
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