Is Fidelity USA Scam or Legit?
As one of the largest asset managers in the world, Fidelity Investment is not a scam. The founding Johnson family owns stock that represents 49% of the company’s shares. The rest of the stock is mostly owned by employees and ex-employees who work diligently to grow the company.
In our
JP Morgan review, the brokerage is rated highly in diversity. A feat Fidelity can also boast about. The company’s growth means they increase the employees and ex-employees’ assets grow too.
As of March 2018, the company boasts of as high as $2.46 trillion in assets under its management. The total customer recorded asset value also peaked at $6.7 trillion as it serves over 32 million people for financial growth. There are also 22,000 businesses and 13,000 financial institutions that receive support from Fidelity.
Our Fidelity brokers review notes that the company is committed to protecting your assets with its Customer Protection Guarantee (CPG). With the CPG, you receive reimbursement from unauthorized activity in your account. Your Fidelity open account is further secured with asset protection programs such as SIPC and FDIC.
Fidelity USA - Usability, Look & Feel
From our Fidelity review, we found the website is easy to use with its simple design. This design makes the User Experience simple and straightforward. Users can freely navigate the site regardless of prior experience with it.
With the search function, it is easy to find suitable options for the stocks. You can also search for international stocks by using the syntax of the country. When using the search function, it focuses on the US without the country code.
The website has a modern feel to it, making it easy to locate all the necessary features of trade. The site is fast, even though it is home to an extensive database and trading processes. This speed keeps its users up to date on the latest data required for trading.
Through the site, you can use the following order types; Market, Limit, Stop Limit, Stop, Stop trailing ($, %), Stop limit trailing ($, %), Multi-contingent, and One Cancels the Other (OCO). Trigger types also include One Triggers the Other (OTO), and One Triggers a One Cancels the Other (OTOCO).
Additionally, the website has a unique BillPay feature for all clients. Clients who subscribe to this can make direct payments and manage bills using your brokerage account. It covers a large variety of bills while giving you the option to pay twenty bills at once. This unique feature also comes at no charge for all customers.
Finally, Fidelity takes transparency seriously on the website. It is with this reason portfolios, and fee reports are easily accessible on the site. Reports are available for download for clients in CSV format.
Getting a Fidelity open account is easy and free we found in our Fidelity brokers review, but not entirely digital. An applicant needs to mail scanned copies of relevant IDs for the office to process the rest.
The company is a US stockbroker that targets clients in the US. There are, however, subsidiaries of FMR that are available in other countries with similar services. For example, customers situated in certain predetermined countries will be able to access the Fidelity services, on what seems to be very similar platforms. However, our readers do not need to worry about this.
To start an account, the minimum deposit at Fidelity is $0. This rate is for basic accounts; Margin, Day Trading, and Fidelity Managed Accounts differ. We found during our Fidelity brokers review that Traders with inadequate funds have the option of trading on leverage. Leverage is money borrowed from the brokerage firm for trading purposes. Clients with Fidelity USA will be able to open any of the accounts listed below.
Fidelity Account Types
Fidelity offers several account types for traders with different financial capabilities. Below are the following models you can find in any Fidelity USA review:
The Brokerage Individual Account
is the first account individuals usually start. This account comes with a $0 minimum balance requirement, making it feasible regardless of financial status.
The Brokerage Joint Account
is similar to the Individual base-level version. The difference is with the ownership of the account, as two or more individuals can own it. Couples and financial partners mostly go with this account.
Business Accounts
are available for ownership and usage by legal entities. Some businesses opt to invest with their profits, and this account is the place to start.
A Trust/ Estate Account
is ideal for trustees looking to open a Fidelity account. Trustees are separate entities of a board with administrative control of a property in trust with a legal obligation.
Roth/ Rollover/ Traditional IRA Accounts
are individual retirement accounts for those investing for a comfortable after-retirement life.
Education Savings Accounts
are savings accounts purposefully opened to tackle all kinds of educational fees.
Charitable Accounts
are tax-efficient accounts meant to cater to charity givings.
Medical Savings Accounts
are for healthcare savings. As human as you are, there is a possibility of draining your finances with medical bills. A medical savings account can prevent such an occurrence.
A Fidelity Managed Account
is managed by the company’s advanced robo-advisor and professionals at Fidelity.
The web trading platform is simple to use and has an appropriate design. There are a lot of order types and a two-step verification that allow for a more secure login process. Even though the trading platform is straightforward to use, it’s not very customizable. This missing feature may not be as necessary since its user interface is reasonably straightforward.
A more detailed Fidelity review would rate out each of the trading platforms independently. However, the web, mobile, and desktop versions are relatively similar. The company also has an in-house developed web trading platform available only in English.
The web trading platform is user friendly. If you allow the two-step verification process, you’ll receive a random 6-digit code. The web trading platform is very secure.
Enabling international trading means you have to search using a country code syntax and ticker. However, as an American client outside of the states, you’ll still be able to search US markets.
Mobile App
The mobile trading platform is also user friendly and well designed we found in our Fidelity brokers review. For login security, it lacks the two-step verification process. On the other hand, the app offers a biometric authentication feature, which is also secure and convenient.
The app is available for both iOS and Android devices, and its UI is simple and straightforward on both. With the search function on the app, it is easy to find suitable options for the stocks. You can also search for international stocks by using the syntax of the country. Just like the other platforms, the search focuses on the US.
The desktop app is not as convenient as the phone app is. However, every Fidelity review rates it as a more practical option for trading. The app is highly customizable to suit each trader. The company’s in-house developed desktop trading platform is the Active Trader Pro.
Our hands on approach to the Fidelity brokers review reveals this platform is more detailed than the web platform since it integrates more research functions and high flexibility. Due to its customizability, the platform tends to run slow in some instances.
Fidelity Payment And Trading Fees
Fidelity USA charges no deposit fees whenever clients deposit through various means. Fidelity clients can use checks, wire transfers, ACH, and PayPal for deposits. Credit and debit cards are, however, not available mediums for deposits. The trading preferences and minimum deposits are as follows:
- Trading with Basic accounts
– $0
- Margin Accounts
– $2000
- Day Trading Accounts
– $25,000
- Fidelity Managed Accounts
– $10 to $500,000
It is necessary to know all the costs you can incur with brokerages. Trading fees are all the costs that accompany trading activities. Non-trading prices on the hand are other payments not related to your trading activities. Generally, they include withdrawal, inactivity, account fees, and more. Fidelity Investment has low trading fees and low non-trading fees. Every Fidelity review lists this as an advantage their clients enjoy.
Trading Fees
Trading fees with Fidelity USA are generally low for traded Securities. Here are the trading fees of the Options, Stocks, ETFs, Bonds, and Funds. There are no charges for stock trading, and no ETF commissions for Americans with a Fidelity open account. However, the company charges high commissions on non-American stocks.
Fidelity charges a commission of 6.5 dollars per 10 contracts. This commission places the charge at $0.65 per contract. In our
Lightspeed USA Review, the company also charges the same per Options contract.
Non-Trading Fees
Our Fidelity brokers review found Fidelity options are in line with the lowest costs for clients. The company implements this by avoiding charges for most non-trading activities. However, in our
Interactive Brokers review, its peer, Interactive Brokers charge client accounts for inactivity. Fidelity does not charge clients inactivity or account fees.
Additionally, Fidelity clients encounter no withdrawal fees when they use ACH transfer to take out money. On the other hand, withdrawals to other banks with wire transfer have a low cost of $10.
Fidelity Customer Service
Every customer appreciates businesses with excellent customer service platforms and processes. In our Fidelity review we found Fidelity opinions place customer services as a priority. The company provides 24-hour support to give fast and relevant answers to clients.
As we found in our Fidelity review, you can access customer service via email, telephone, and live chats. In our
M1 Finance review, the company provides support only via phone and email we found in our Fidelity brokers review
These various forms of support are currently only available in English.
- By Phone
– The customer support team at Fidelity USA is trained to communicate with clients. They can help you navigate your Fidelity open account since they are familiar with relevant information.
- By Email
– For clients that prefer communication via email, Fidelity provides that option for customer service support. The company has several dedicated employees in charge of replying to customer complaints and requests. It does not take long to connect with customer service via email.
- By Live Chat
– The live chat option provides straightforward answers for simple questions. An AI usually provides solutions with access to enough company and industry-related info.
Regulation And Deposit Insurance
Fidelity has implemented a Customer Protection Guarantee. Our Fidelity review identified this guarantee is to help customers feel more secure as they can get reimbursement. Reimbursement occurs after clients lose funds from unauthorized activity in their accounts.
Regulations are essential to safeguard your accounts. Following rules set by regulatory bodies is an excellent place to start for security. These rules protect client accounts from internal malpractices in brokerage firms.
A Fidelity review lists FDIC Insurance and SIPC coverage as two regulatory and insurance bodies that cover Fidelity. The cash deposit insured by FDIC at a maximum of $250,000 per account. Not all accounts are eligible for FDIC insurance at Fidelity. The following are protected accounts under Fidelity:
- Fidelity Health Savings Account
- Fidelity Cash Management Account
- Some retirement accounts – Rollover, Traditional, and SEP IRA’s
On the other hand, almost all other Fidelity Accounts are SIPC covered. The exceptions include Mutual Funds and Workplace requirement accounts. The SIPC protects stocks, bonds, futures, and other securities in case brokerage firms go bankrupt and assets go missing. SIPC covers $500,000 in securities and $250,000 in cash accounts. Fidelity SIPC has a total aggregate coverage of $1 billion.
Within Fidelity’s excess of SIPC coverage, there is no per customer dollar limit on securities coverage. Yet, there is a per customer limit on coverage of $1.9 million of cash awaiting investment.
Other types of protection are offered for Mutual funds and Workplace retirement accounts since they are not SIPC and FDIC covered. Fidelity is proactive in keeping the client’s account safe; hence, the specific protection guidelines exist for both accounts.
Fidelity Review - Additional Features & Investment Products
Aside from trading with securities, Fidelity gives its clients other investment offers. With a Fidelity open account, you have access to create accounts for College savings, Sector giving, Charitable giving, and Life Insurance. These added services are fantastic options for those looking to save for a specific purpose or donate towards a cause.
529 College Savings
Fidelity provides a flexible and tax-advantaged account for educational savings. Saving for college with Fidelity offers flexible use of funds and many investment choices. The company guarantees this package as a path away from student loan debt.
The 529 College Savings Plan can be used to cover qualified educational expenses nationwide.
Annuities
Annuities are special investment accounts that target comfortable retirement for clients. With a retirement plan, annuities can guarantee income or increased retirement savings.
Charitable Giving
With or without amassed wealth, many people seek to give a portion of their money to charity. Fidelity Investments provides a donor-advised fund (DAF) for this social cause. There are a lot of tax advantages with DAF as compared to just selling securities and donating the proceeds to charities.
You earn a consolidated tax receipt with Fidelity’s Charity processes. The company prides itself as the nation’s top grantmaker,
Sector Investing
Sector investing involves targeted exposure to the stocks of companies in specific sections of the economy. Using the targeted approach can help you pursue growth, manage risk, and diversify your portfolio.
Fidelity provides the insight necessary for targeted exposure to companies. Although Thermal investing offers targeted exposure too, it cuts across sectors with a specific objective. The brokerage firm provides a wide selection of sector funds and ETFs for adequate for Sector Investing.
Life Insurance & Long Term Care
In a Fidelity review USA, the company has available Life Insurance solutions for its clients. Fidelity provides three types of life insurance packages. They include Team Life Insurance, Hybrid Life Insurance, and Universal Life Insurance.
As the base-level package, Term Life Insurance is the least costly. It provides a lump sum of money that serves as a safety net for a fixed time.
The Hybrid Life Insurance package comes with long-term care. It helps you pay for long-term care needs. With the company’s life insurance policy, the remaining balance goes to beneficiaries.
The last type is the Universal Life Insurance package. This insurance type is usually federal tax-free and can provide coverage for your family and business.
