Fidelity Investments: Legit Or Scam?

Fidelity Investments is one of the largest and best brokerage and robo-advisor platforms, offering a wide range of trading tools, brokerage accounts, and advanced trading features. It is considered a safe and secure company to invest with, and it is highly rated for its customer service. However, there are some negative reviews online, with some customers reporting issues with account management, poor customer service, and hidden fees. So, is Fidelity Investments legit?

Is Fidelity a safe company to invest with?

Fidelity is one of the largest and best brokerage and robo-advisor platforms, offering a robust selection of trading tools, brokerage accounts, and advanced trading features. It is considered a safe company to invest with, with a strong reputation and track record.

Fidelity is an industry leader with a stellar reputation and is fully regulated in the U.S. with the SEC and FINRA. It is trusted by over 43 million people and holds over $11.5 trillion in assets under administration. The company has been in business since 1946 and is headquartered in Boston, Massachusetts.

Money held in an investment account with Fidelity is protected by SIPC insurance, which covers up to $500,000 in securities ($250,000 cash maximum) per customer. Additionally, Fidelity provides extra coverage through Lloyd's of London for up to $1 billion across all customer accounts and up to $1.9 million per customer for cash.

Fidelity offers a wide range of investment options, including stocks, ETFs, mutual funds, options, bonds, and cryptocurrencies. It also provides commission-free trades for U.S. stocks, ETFs, and options, with the exception of a $0.65 per-contract charge for options trades.

The company has a strong reputation for its mutual funds, offering a large selection of no-transaction-fee funds, including its Fidelity Zero index funds, which have no expense ratio.

Fidelity also stands out for its educational resources and customer support, making it a good choice for beginners. It offers a network of over 200 physical branches and provides 24/7 phone, chat, email, and social media support.

While Fidelity is generally considered safe and reliable, there are some negative reviews and complaints online. Some customers have reported issues with customer service, account restrictions, and delays in transferring funds. There have also been a couple of pending lawsuits against Fidelity regarding data breaches and alleged negligence.

Overall, Fidelity is a reputable and established company with a wide range of investment options and strong customer support, making it a safe choice for investors.

What are the pros and cons of investing in Fidelity Investment Accounts?

Pros of investing in Fidelity Investment Accounts:

• Low account minimums and fees.
• Commission-free stocks, ETFs, options, and fractional shares.
• Large range of investing tools and trading platforms.
• Fee-free mutual funds.
• Fidelity basket and youth basket portfolios.
• Superior trading platforms for all types of investors.
• Accessible and knowledgeable customer service.
• Extensive research and screeners.
• No payment for order flow on stocks and ETFs.
• High yields on money market mutual funds.
• Low or no fees on account management and services.
• Good for beginners.

Cons of investing in Fidelity Investment Accounts:

• Robo-advisor requires a higher minimum to access unlimited CFP access.
• Newer investors may be overwhelmed by the number of options.
• Fidelity Go doesn't offer tax-loss harvesting.
• The desktop trading platform, Active Trader Pro, could use an overhaul and feels dated.
• Doesn't offer an alternative mobile app designed for active trading.
• Doesn't offer futures trading or options on futures.
• There's no paper trading.
• Only two digital coins for trading.
• Portfolio analysis and planning tools lack a centralized location.
• Virtual assistant needs improvement.

How does Fidelity support beginner investors?

Fidelity is a great platform for beginner investors, offering a combination of educational content and easily navigated mobile apps and web pages. Here are some of the ways Fidelity supports beginner investors:

• Fidelity offers a wide range of educational resources, including articles, videos, webinars, infographics, courses, and podcasts. These resources cover various topics, such as how to start investing, choosing the right account type, picking investments, and managing risk.
• Fidelity has a low barrier to entry, with no minimum amount required to open an account and no monthly service charges. This makes it accessible to beginners who may not have a large sum of money to invest upfront.
• Fidelity provides fractional share stock and trading options, allowing investors to purchase a fraction of a share instead of a whole share. This enables beginners to invest in higher-cost stocks without needing to commit a large amount of capital.
• Fidelity's Youth mobile trading app is specifically designed for young traders just starting their investment portfolios. It offers a curated and parent-friendly savings, spending, and investing experience for teenagers.
• Fidelity's platform is user-friendly and intuitive, making it easy for beginners to navigate and find the information they need. The mobile app includes a customizable newsfeed and the ability to schedule appointments with a Fidelity advisor.
• Fidelity offers a wide range of investment options, including stocks, mutual funds, ETFs, options, bonds, and fixed-income products. This allows beginners to explore different investment opportunities and diversify their portfolios.
• Fidelity provides robust research and market commentary, with an extensive array of third-party reports and quality rankings of data. This helps beginners make informed investment decisions.
• Fidelity has a network of over 200 physical branches across the United States, providing in-person advice and support for beginner investors who prefer face-to-face interactions.

What are the fees associated with Fidelity Investments?

Fidelity Investments offers a range of services with different fees associated with them. Here is a detailed breakdown of the fees:

Trading Fees

• Stock and ETF trades: $0 commission for online US trades.
• Options trades: $0 plus $0.65 per contract.
• Bonds and CDs: $1 per bond or CD in secondary trading; US Treasuries traded online are free.
• Mutual funds: $0 for Fidelity funds and hundreds of other funds with no transaction fees; transaction fees of $49.95 may apply for non-Fidelity funds.
• International trading: International trading is available in 25 countries with access to 20 currencies.

Account Fees

• Account opening and maintenance: There are no account opening or monthly service charges.
• Minimum balance: There is no minimum balance required to open an account, but certain investments have minimum initial purchase requirements.
• Account transfer out: There is no fee for transferring out of a Fidelity account.
• Paper statements: $25 fee for paper statements (online statements are free).
• Margin rates: The base margin rate is 11.325%, and the rate decreases as the outstanding margin balance increases.

Other Fees

• Cryptocurrency: A 1% markup or markdown is embedded in the execution for crypto trading.
• Cash management: Cash management accounts have no account fees and offer bill pay and a debit card.
• Retirement services: There are no miscellaneous fees for IRA accounts.
• Fractional shares: Fractional shares are available for trading without additional fees.
• Research and education: Fidelity provides extensive research and educational resources at no additional cost.

How does Fidelity stand out in terms of customer service?

Fidelity stands out in terms of customer service by offering a wide range of support features to help clients navigate their financial journey. Here are some ways in which Fidelity's customer service is noteworthy:

• Live Chats, Phone Calls, and In-Person Consultations: Fidelity provides multiple channels for customers to connect with their team, making it convenient for clients to choose the most suitable option for their needs.
• 24/7 Availability: Fidelity's customer service is accessible around the clock, ensuring that clients can get assistance whenever they need it, regardless of the time of day.
• Certified Financial Planner (CFP) Guidance: Fidelity customers can access personalised advice and guidance from CFPs without any additional charges, which is especially beneficial for those with complex financial situations or seeking expert guidance.
• In-App Educational Resources: The Fidelity app offers a comprehensive learning centre with articles, videos, webinars, infographics, and podcasts tailored to investors' needs. This feature empowers users to enhance their financial knowledge and make more informed decisions.
• Social Media Presence: Fidelity maintains an active presence on various social media platforms, including Reddit, Facebook, Twitter, Instagram, and Discord. Customers can receive timely responses and support from social media customer service managers through these channels.
• Network of Physical Branches: With over 200 Investor Centres across the United States, Fidelity offers in-person advice and educational resources for those who prefer face-to-face interactions and traditional brick-and-mortar establishments.
• Security and Fraud Protection: Fidelity prioritises the security of its customers' accounts and personal information. They employ multi-factor authentication, encryption software, intrusion protection systems, and other advanced security measures to protect their clients' sensitive data. Additionally, they offer a Customer Protection Guarantee, reimbursing customers for unauthorised account activity.

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