Merrill Edge Self-Directed Investing Account Review 2024

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The Merrill Edge self-directed investing account has a lot to offer customers. Backed by industry heavyweight Merrill Lynch, long a dominant force in the full-service brokerage world, and its newer parent company, banking giant Bank of America, Merrill Edge provides freedom to independent investors while carrying a full host of additional features, benefits and services for those who want them.

Most investors will appreciate the vast research offered by Merrill Edge, and all will likely enjoy the firm’s commission-free stock and ETF trading capabilities. But there are a variety of pros and cons that all investors should know before they pick Merrill Edge as their brokerage of choice, as it’s important to work with a firm that matches your needs as an investor. Here’s a look at what Merrill Edge has to offer.

What Is Merrill Edge?

Merrill Edge combines the powerhouse capabilities of Merrill Lynch and Bank of America with the freedom for investors to manage and run a completely self-directed account.

When you open a Merrill Edge self-directed investing account, you’re in charge of your portfolio and all of its decisions, from buying and selling individual securities to managing deposits and withdrawals. However, even then, you’re not completely on your own. As a client, you have access to Bank of America’s global research capabilities, providing everything from market insight to explanations of various investments.

The Merrill Edge self-direct account charges:

• $0 for stock and ETF trades
• $0 commission on options trades, although option trades are subject to a $0.65 fee per contract

In other words, the Merrill Edge self-directed investment account functions like a no-cost online broker but with the research capabilities and product options of a large firm. For many investors, this can be a perfect combination.

Although the Merrill Edge self-directed account has a lot to offer, that doesn’t mean it’s for everyone. The right brokerage account for you might be completely different from the one your friends or family members select. It all comes down to finding the right blend of products, services, capabilities and cost based on your own personal investment needs. With that in mind, here’s a look at the overall pros and cons of the Merrill Edge self-directed account:

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Investment Options

According to Merrill Lynch, its self-directed investment account offers “a wide range of stocks, mutual funds, exchange-traded funds (ETFs), fixed income and bond investments, and options.”

For the average investor, this product range is likely sufficient. However, if you’re an advanced or speculative trader and want to dabble in less common investments like commodities, foreign currency, futures or cryptocurrency, you won’t be able to do so through the Merrill Lynch self-directed investment option.

A bit more troubling is the fact that you can’t access fractional shares of stock through the self-directed account at Merrill. While not quite the industry standard as of yet, many competitor firms do offer this option, which can be a big help for smaller investors looking to diversify their portfolios.

Fees and Commissions

Although the Merrill Edge self-directed account is framed around zero commissions, there are certain fees, costs and commissions involved with various transactions. Here’s an overview of the most common:

Stocks and Bonds

• Unlimited $0 online stock and ETF trades
• No trade or balance minimums
• Broker-assisted trades incur a $29.95 fee

Options

• Unlimited $0 options trades
• No trade or balance minimums
• Broker-assisted trades incur a $29.95 plus $0.65 per-contract fee
• $0 commission on exercised or assigned options

Mutual Funds

• $0 per transaction for load-waived funds
• $0 per transaction for no-load, no-transaction-fee funds, although a $39.95 early redemption fee applies if the fund is sold within the first 90 days
• $19.95 per transaction for no-load, transaction-fee funds; $29.95 for broker-assisted transactions

Fixed Income and Bonds

• $0 commission for self-directed or broker-assisted trades of new issues, including brokered CDs
• $0 commission for online trades of Treasury securities, including auction and secondary issues; $29.95 per trade for broker assistance
• $1 per bond commission for self-directed secondary trades, including corporates, municipals and government agency bonds; $29.95 service charge per trade for broker assistance, plus the $1 per bond commission; $10 minimum/$250 maximum commission for all trades

There are no annual account fees or investment minimums with the Merrill Edge self-directed account. If you transfer your entire account balance to another firm, you’ll incur a $49.95 fee. Wire transfers cost $24.95, while stop payments cost $50.

Note that in addition to having no account fees or investment minimums, there is no fee if you transfer out your IRA account.

Mobile App

The Merrill Edge mobile app provides the basic features and benefits most app users would expect, such as the ability to access your account information, transfer money among accounts, place trades, and review your portfolio. However, the app seems to have many more users – and favorable reviews – on the App Store as opposed to Google Play. The 122,564 users who have left reviews on the App Store, for example, give the Merrill Edge app 4.6 stars. But only 7,236 users have left reviews on Google Play, with an average rating of just 3.3 stars.

Bonuses

Currently, offers a cash reward of between $100 and $600 if you open a new account, make a new deposit within the first 45 days and hold the balance for at least 90 days. Specifics are as follows:

• Deposit $20,000: Earn a $100 bonus
• Deposit $50,000: Earn a $150 bonus
• Deposit $100,000: Earn a $250 bonus
• Deposit $200,000+: Earn a $600 bonus

Note that this bonus is valid as of June 29, 2024 but it is subject to change at any time.

The Bottom Line

The Merrill Edge self-directed investment account can be a great option for investors who simply want to trade stocks and ETFs without paying commissions but want the research capabilities of a big firm behind them. Self-directed investors can take advantage of the various investment information provided by Bank of America, sorted and categorized to their liking, without having to pay for a full-service broker, and they can use this information to inform their self-directed, zero-commission trading.

However, those looking for crypto, futures or currency trading, fractional-share trading, or high-level day-trading support may want to look elsewhere.

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