Fidelity Investments: Understanding Their Fee Structure

Fidelity Investments is one of the largest investment brokers in the US, serving nearly 50 million clients. The company offers a range of investment options, including stocks, options, ETFs, mutual funds, bonds, and CDs. While some of their services are commission-free, such as online US stock, ETF, and option trades, there are other fees associated with specific types of transactions and accounts. For example, there is a fee of $0.65 per contract for options trades, and managed accounts may have higher fees. Additionally, there may be costs associated with account transfers, early IRA withdrawals, electronic funds transfers, and other services. It is important to carefully review the full brokerage commission and fee schedule to understand the potential costs involved.

Fidelity's fees for online trading

Fidelity offers $0 commission trades for online US stock, exchange-traded funds (ETFs), and options in a Fidelity retail account for Fidelity Brokerage Services LLC retail clients. However, there is an additional fee of $0.65 per contract for options. Sell orders are subject to an activity assessment fee of between $0.01 and $0.03 per $1,000 of principal. A limited number of ETFs are subject to a transaction-based service fee of $100. There is also an Options Regulatory Fee for both option buy and sell transactions, the amount of which is subject to change.

Fidelity offers margin rates as low as 8.50% for debit balances over $1,000,000. The current base margin rate, effective since November 8, 2024, is 11.575%.

For US Treasury purchases traded with a Fidelity representative, a flat charge of $19.95 per trade applies. A $250 maximum applies to all trades, reduced to a $50 maximum for bonds maturing in one year or less.

Fidelity also offers four zero expense ratio index mutual funds:

• Fidelity ZERO Total Market Index Fund (FZROX)
• Fidelity ZERO International Index Fund (FZILX)
• Fidelity ZERO Large Cap Index Fund (FNILX)
• Fidelity ZERO Extended Market Index Fund (FZIPX)

These funds are available to individual retail investors who purchase their shares through a Fidelity brokerage account.

Fees for managed accounts

Fidelity offers a range of managed account options, including:

• Digital investment management and advice: This service provides access to online planning resources and tracking tools to help you make informed investment decisions. There is no minimum balance required to open a digital investment management account, and you can access coaching services once your balance reaches $25,000.
• Digital investing plus access to coaching: This option offers professional money management with automatic rebalancing to keep your investment strategy on track. There is no minimum balance required to open an account, and you can access coaching services once your balance reaches $25,000.
• Fidelity Managed FidFolios®: This option offers professionally managed stock portfolios with a $5,000 minimum investment. These portfolios are managed by a team of professionals and include tax-smart strategies.
• Personalized Portfolios account: This is a comprehensive, multi-asset class approach that provides exposure to a mix of stocks and bonds based on your time horizon, comfort with risk, and investment preferences. Tax-smart strategies are also built into this option.
• Separately managed accounts: These are targeted, single-asset class portfolios generally consisting of individual stocks or bonds. These portfolios are designed to meet specific investment objectives and include tax-smart investing strategies for stock portfolios.

The fees for these managed accounts vary depending on the specific service and your account balance. For example, the digital investment management and advice option has a gross advisory fee of $0 for balances under $25,000 and 0.35%/year for balances of $25,000 and above. The digital investing plus coaching option has a gross advisory fee of $0 for balances under $10,000, $3/month for balances between $10,000 and $49,999, and 0.35%/year for balances of $50,000 and above.

The Personalized Portfolios account and Separately Managed Accounts are available through Fidelity® Wealth Services or Fidelity® Strategic Disciplines and have gross advisory fees ranging from 0.20% to 1.04% based on a minimum investment of $2 million.

It's important to note that investing involves risk, and the value of your investments may fluctuate. Fees and charges may also change over time, so it's always a good idea to review the latest information from Fidelity before making any investment decisions.

Fees for robo-advisors

Fidelity's robo-advisor service, Fidelity Go, offers a straightforward fee structure. There is no advisory fee for balances under $25,000, and a flat annual fee of 0.35% for balances of $25,000 and above. This fee is applied to the entire balance, not just the amount exceeding $25,000. There are no additional trading, transaction, or rebalancing fees.

Fidelity Go provides a digital financial service that uses technology to automate investing based on information provided by the investor about themselves and their financial situation. This service includes access to a team of dedicated Fidelity advisors for those with balances of $25,000 or more.

Fidelity Go offers investment strategies ranging from conservative to aggressive. The most conservative strategy targets 20% stocks and 80% bonds and short-term investments, while the most aggressive strategy targets 100% stocks.

Fidelity Go accounts have no minimum initial investment requirement. However, a balance of at least $10 is needed for Fidelity to start investing according to the chosen investment strategy.

Fees for partial account transfers

Fidelity does not charge a fee for moving assets from another institution. However, your current firm may charge a fee to transfer your assets to Fidelity.

There is an account transfer out fee for partial account transfers. The fee is $15 online and $25 by paper.

Fees for full account transfers

Fidelity does not charge a fee for a full account transfer, also known as a Transfer of Assets (TOA). However, the other firm involved in the transfer may charge a fee. For example, one user on Reddit reported being charged a fee of $150 by Vanguard for a partial transfer out of their Fidelity account.

Fidelity does not charge a fee to move assets from another institution, but your current firm may charge to transfer your assets to Fidelity.

Fidelity offers a transparent fee structure, with no account fees and no minimums to open a retail brokerage account, including IRAs.

Frequently asked questions