PROS / Fidelity offers excellent educational resources, including a stock trading simulator.
CONS / This entirely online platform is not customizable, so you may have to sift through information that does not concern you.
VERDICT / Fidelity offers full-service investing advice and support, and its fees are lower than most of the other companies we reviewed. It's an excellent choice if you want to add stock investments to your overall financial plan.
Fidelity offers numerous investment products, including mutual funds, ETFs, stocks and online options trading. The Fidelity platform is entirely online, giving you direct access to all of its resources within the browser. Although this online platform is not customizable, we found the platform easy to use and were especially impressed with the mobile app. While you can find services with lower fees, Fidelity's fees are comparable to the best options brokers. This online options trading company earns our Top Ten Reviews Silver Award.
Fees & Commissions
Fidelity charges a flat $4.95 fee for trading options and a $0.65 per-option contract fee, which is an average contract fee. There is no minimum amount for orders, so if you do not plan on trading a large number of contracts each time, you may spend less with Fidelity than you would with other services. If you choose to trade 10 or more contracts, the fees remain competitive with many other brokers. Also similar to other brokers is the fee to exercise or assign a contract, which is a standard $7.95 fee. However, the $32.95 broker-assisted fee is higher than most services.
With margin accounts, you must maintain a $2,500 balance, which is on the high end for the stock trading services we reviewed. Interest rates for margin accounts are determined through the base rate established by Fidelity, which, while subject to change, has been the same since 2009. For balances under $10,000, the rate is 8.825% and drops in increments as the account balance increases, with rates as low as 4% for balances above $500,000. These rates are competitive with other online options brokers.
Platform & Tools
When you log in to the online platform, you have immediate access to the summary of your portfolio, including the totals for your accounts. You can view your positions, which show the current stock price, the change since closing and the change since you purchased the stock. Increases and decreases in value are color-coded in green and red respectively for a quick view of each stock’s performance.
When you search for a stock, you can create an option chain and view quotes for calls and puts. Fidelity provides a number of strategies, which you can filter by outlook, profit potential or risk potential. Strategies include iron condor, butterfly, straddle, diagonal and vertical spreads, among others. When researching stocks, you can take advantage of the probability and profit-versus-loss calculators. You also have access to market news, articles and stock screeners. While you cannot customize the dashboard, you can configure alerts, watchlists and screeners based on your own criteria. Fidelity offers 63 different technical indicators, the second highest among the brokers we reviewed.
For mobile stock options trading, you have the options of using the website in a mobile browser or of downloading apps for the iPhone, iPad, Android phones, Windows Phone 8 or Kindle Fire. You can access your account, research stocks and order trades, which are all standard features of mobile apps. In addition to typical features, the apps allow you to deposit checks directly into your Fidelity accounts by taking a picture of the check with your mobile device.
Education & Resources
Fidelity offers many opportunities and resources to increase your knowledge on trading and investing. Online, you can find guidance for investing, saving and managing your budget. It provides free seminars hosted at its investment centers to learn how to trade options and other investments. Having local branches also allows for face-to-face and personal interaction with a broker if you ever need it.
Options traders can make use of Fidelity’s webinars and the Viewpoints blog. The archive is accessible, and a wide range of topics are covered, so even experienced investors can make use of these resources.
Another useful tool Fidelity offers as part of its platform is simulated trading. This can be useful both as a way to learn the platform and also to test trading strategies.
Fidelity offers many standard features in its platform, which, while not customizable, provides a comprehensive list of tools for researching and ordering trades. While you can find cheaper services, its fees are nonetheless competitive and Fidelity offers more educational resources than most of the online options trading services we reviewed. Plus, it has local branches where you can receive personal attention, making this a better choice if you appreciate that human factor. Overall, Fidelity is an excellent choice for options traders of all skill levels.