Fidelity Investments: Is It The Same As Fidelity?

Fidelity Investments, formerly known as Fidelity Management & Research (FMR), is an American multinational financial services corporation based in Boston, Massachusetts. The company was established in 1946 and is one of the largest asset managers in the world, with trillions of dollars in assets under management. Fidelity offers a wide range of financial products and services, including brokerage, mutual funds, investment advice, retirement planning, and more. The company has a strong reputation and is trusted by many for its investment expertise and comprehensive range of offerings. With a focus on strengthening the financial well-being of its customers, Fidelity has become a go-to choice for individuals looking to invest and grow their wealth.

Fidelity Investments' history and services

Fidelity Investments, formerly known as Fidelity Management & Research (FMR), is an American multinational financial services corporation based in Boston, Massachusetts. Established in 1946, the company is one of the largest asset managers in the world, with $5.8 trillion in assets under management and $15 trillion in assets under administration as of September 2024.

The history of the company dates back to May 1, 1930, when The Fidelity Fund was incorporated in Massachusetts, with Edward C. Johnson II serving as president. The corporate structure changed in 1946 and the company became known as Fidelity Management & Research (FMR). In 1969, the company formed Fidelity International Limited (FIL) to serve non-U.S. markets and, in 1980, it was spun off into an independent entity owned by its employees.

Fidelity Investments has a long history of innovation and expansion. In 1982, the company started offering 401(k) products, and in 1984, it introduced computerized stock trading. In 1997, Robert Pozen was named CEO, and in 2001, Geode Capital Management was established to run and incubate investment strategies for FMR. The company launched its first ETF in 2003, called the Fidelity Nasdaq Composite Index Tracking Stock Fund (ONEQ).

In 2010, Fidelity shut down its venture capital arm, Fidelity Ventures, and many of the employees went on to create Volition Capital. The following year, the company changed the name of its international division from Fidelity International to Fidelity Worldwide Investment and introduced a new logo. In 2012, Fidelity moved its Boston headquarters to 245 Summer Street.

Fidelity Investments has continued to grow and diversify its business. In 2014, Abigail Johnson became president and CEO of the company, and chairman of Fidelity International (FIL). In 2018, the company launched a separate entity dedicated to institutional cryptoasset custody and cryptocurrency trading. As of September 2024, Fidelity Investments operates a brokerage firm, manages a large family of mutual funds, and provides a range of financial services including fund distribution, investment advice, retirement services, index funds, wealth management, securities execution, and life insurance.

The company has a strong focus on innovation and meeting the evolving financial needs of its customers. It offers a wide range of services to individual investors, advisors, and institutions. For individual investors, Fidelity provides financial planning, advice, and educational resources to help investors make their goals a reality. The company also works closely with employers to create dynamic, integrated benefit programs for their employees, including retirement savings, health and welfare, and stock plan services.

For advisors and institutions, Fidelity helps wealth management firms and institutions navigate the changing industry landscape and grow their businesses. The company provides investment and technology products, solutions, clearing and custody services, and institutional trading products to thousands of firms.

With a global presence spanning 11 countries and over 76,000 associates, Fidelity continues to be a leader in the financial services industry, helping millions of individuals and businesses with their financial goals.

Fidelity Investments' competitors

Fidelity Investments, formerly known as Fidelity Management & Research (FMR), is an American multinational financial services corporation. It is one of the largest asset managers in the world, with trillions of dollars in assets under management and administration.

Fidelity's competitors include:

Edward Jones

Edward Jones offers similar services to Fidelity, and ranks 3rd in Overall Culture Score, compared to Fidelity's 2nd place. Edward Jones also ranks higher in Customer Service, with a score of 3.5/5 compared to Fidelity's 3.5/5.

BlackRock

BlackRock is another competitor, ranking 2nd in Diversity Score, compared to Fidelity's 3rd place. BlackRock also scores higher in CEO ratings, with a score of 81 out of 100.

TIAA

TIAA is a financial services provider in the academic, research, medical, cultural, and government fields. They rank 4th in CEO ratings, with a score of 78 out of 100.

Charles Schwab

Charles Schwab is a competitor with a higher Net Promoter Score of 19, compared to Fidelity's score of 19. They also rank higher in Pricing Score, with a score of 3.5/5 compared to Fidelity's 3.5/5.

UBS

UBS ranks 6th in CEO ratings, with a score of 69 out of 100. They also have a higher Product Quality Score, with a rating of 3.6/5 compared to Fidelity's 3.6/5.

Other competitors of Fidelity include Brighthouse Financial, Franklin Templeton, Principal Financial Group, Vanguard, Voya Financial, Legg Mason, and Aditya Birla Capital. These companies offer a range of financial services, investment management, and insurance products, competing directly with Fidelity in the market.

Fidelity Investments' fees and pricing

Fidelity Investments, formerly known as Fidelity Management & Research (FMR), is an American multinational financial services corporation. It is one of the largest asset managers in the world, with trillions of dollars in assets under management and administration.

Fidelity offers a range of financial services, including brokerage, mutual funds, investment advice, retirement services, and wealth management. The company has a large family of mutual funds and provides fund distribution, index funds, securities execution, and clearance.

Account Fees

Fidelity does not charge any fees or minimums to open a retail brokerage account, including IRAs. There are also no account fees, inactivity fees, or outgoing transfer fees. This means you can open and maintain an account without incurring any costs, making it accessible to investors with varying financial situations.

Trading Fees

Fidelity offers commission-free trades for online US stock, ETF, and option trades. However, there is a $0.65 per contract charge for options trades. For options buy and sell transactions, there is also an Options Regulatory Fee that is subject to change.

Additionally, there is an activity assessment fee for sell orders, which has historically ranged from $0.01 to $0.03 per $1,000 of principal. A limited number of ETFs are subject to a transaction-based service fee of $100.

Fidelity also offers margin trading, and the margin rate depends on your outstanding margin balance. The higher your balance, the lower the margin rate charged. As of December 20, 2024, the base margin rate was 11.325%.

Mutual Funds Fees

Fidelity offers a wide range of mutual funds with competitive fees. They provide over 3,300 no-transaction-fee mutual funds, meaning you can buy or sell these funds without incurring a transaction fee.

Fidelity also introduced a line of zero-expense-ratio mutual funds, which have no expense ratio and no minimum investment requirement. These include the Fidelity ZERO Total Market Index Fund, the Fidelity ZERO International Index Fund, the Fidelity ZERO Large Cap Index Fund, and the Fidelity ZERO Extended Market Index Fund.

For proprietary retail mutual fund investment, the minimum investment requirements range from $1,000 to $3,000 for Investor Shares and $3,000 to $100,000 for AdmiralTM Shares. There is also a low balance fee for mutual funds, with a minimum initial investment requirement.

Planning and Advice Fees

Fidelity provides digital managed accounts and customized planning services through Fidelity® Wealth Management. The gross advisory fee varies depending on the balance of your account. For accounts under $25,000, there is no fee, while accounts above $25,000 are charged 0.35%/year.

Fidelity also offers Fidelity® Personalized Planning & Advice, with a gross advisory fee of 0.50% for accounts with a balance of $25,000 or more.

Other Fees

Fidelity charges a $1 fee per bond or CD in secondary trading, but US Treasuries traded online are free. There may also be additional fees for specific services, such as electronic statements, early IRA withdrawals, cash management services, wire transfers, and overnight check delivery.

Comparison to Other Brokers

Fidelity's elimination of commissions for US stock, ETFs, and options trades in 2019 brought it in line with other major brokers. However, the $0.65 per contract charge for options trades is relatively high compared to some competitors, who have eliminated options contract fees altogether.

Fidelity also stands out with its extensive selection of no-transaction-fee mutual funds and zero-expense-ratio index funds, making it a cost-effective option for investors.

Overall, Fidelity's fees and pricing structure is competitive and transparent, offering commission-free trades, no account fees, and a range of investment options with varying fee structures to suit different investor needs.

Fidelity Investments' target audience

Fidelity Investments is a privately held American multinational financial services corporation, established in 1946. It is one of the largest asset managers in the world, with trillions of dollars in assets under management and administration. The company offers a wide range of financial products and services, including brokerage services, mutual funds, retirement services, wealth management, and investment advice. With such a diverse range of offerings, who is the target audience for Fidelity Investments?

The target audience for Fidelity Investments appears to be longer-term investors seeking comprehensive financial planning assistance. The company's products and services cater to those looking for more conservative investments, such as mutual funds, bonds, annuities, and CDs. Fidelity's commission and fee structure favour passive investors who want to create a conservative financial plan. The company provides access to financial planning tools and guidance, making it attractive to individuals who want help examining the big picture and setting up long-term investment strategies.

Fidelity's product lineup is one of its strong points, offering stocks, options, bonds, exchange-traded funds (ETFs), mutual funds, CDs, annuities, bank accounts, credit and debit cards, and bill payment services. This product flexibility makes it appealing to those who want to manage their investments without the hassle of switching between multiple accounts.

Fidelity also stands out for its low-cost or no-fee structure on many products and services. For example, online trading for stocks and ETFs is commission-free. This makes the platform particularly attractive to cost-conscious investors. Additionally, Fidelity offers high-yield cash investments, such as money market mutual funds, which provide higher interest rates than traditional savings accounts.

In recent years, Fidelity has expanded its offerings to include cryptocurrency trading and custody services, catering to investors interested in digital assets. The company also introduced "Stocks by the Slice," a program aimed at micro-investors who want to capitalise on fractional-share ownership, making investing more accessible and affordable.

Overall, Fidelity Investments targets a broad range of investors, from beginners to advanced active traders. However, its services seem to be particularly well-suited for longer-term investors seeking comprehensive financial planning assistance, conservative investment options, and low-cost or no-fee products.

Fidelity Investments' reviews

Fidelity Investments, formerly known as Fidelity Management & Research (FMR), is an American multinational financial services corporation based in Boston, Massachusetts. Established in 1946, the company is one of the largest asset managers in the world, with trillions in assets under management and administration.

Reviews for Fidelity Investments are generally positive, with the company scoring highly in Bankrate's comprehensive review of brokers. The company offers a range of investment options, including stocks, bonds, mutual funds, ETFs, options, forex and cryptocurrencies.

Pros

• Low costs: $0 trading commissions for stocks, ETFs, and options, with competitive options contract fees.
• No account fees: elimination of transfer-out, IRA closeout, and reorganization fees, among others.
• Extensive research and educational resources: valuable information for investors of all levels, including webinars, recorded videos, and third-party research.
• Fractional shares: Stocks by the Slice program allows for the purchase of partial shares for as little as $1, enabling diversification into higher-cost stocks.
• Mutual funds: a large selection of no-transaction-fee funds and four mutual funds with no expense ratio.
• Customer service: responsive and helpful support available by phone, email, and live chat.

Cons

• Limited cryptocurrency offering: currently only supports trading for Bitcoin, Ethereum, and Litecoin.
• No futures trading: does not offer trading for more exotic products like futures.
• Account verification: some customers experienced issues with long wait times for funds verification and account transfers.
• Technical issues: some users reported problems with the trading platform not registering or showing executions, causing losses.
• Customer support delays: a few instances of slow responses or lack of communication regarding account issues.

Overall, Fidelity Investments is a well-rounded investment broker that caters to both beginner and advanced investors, offering a wide range of investment options, educational resources, and competitive fees.

Frequently asked questions