Understanding Merrill Edge Hidden Fees

Merrill Edge is a popular online brokerage firm that offers a range of investment products, including stocks, bonds, ETFs, and mutual funds. However, like many financial institutions, Merrill Edge has its own set of hidden fees that can eat into your investment returns.

One of the most significant hidden fees is the maintenance fee, which can range from $0 to $20 per month, depending on the type of account you have. This fee is charged even if you have a zero balance in your account.

If you're not careful, these fees can add up quickly and eat into your investment returns. For example, if you have a $10,000 investment portfolio and you're charged a $10 maintenance fee per month, that's $120 per year in fees.

To avoid these fees, it's essential to understand what they are and how they work. By doing so, you can make informed decisions about your investments and minimize the impact of hidden fees on your portfolio.

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The Merrill Edge Self-Directed account offers $0 online stock and ETF trades, which is a significant cost savings for frequent traders.

You can also place online option trades for $0, but be aware that there's a fee of $0.65 per contract for options.

If you use a representative to place your trades, the fees jump to $29.95 for stock and ETF trades and $29.95 plus $0.65 per contract for options trades.

There are no commissions on most mutual funds unless they're no load, transaction-fee funds, which cost $19.95 per transaction.

Broker-assisted transactions for these funds cost $29.95.

Joining the Bank of America Preferred Rewards program can help reduce the annual fee on guided investing, with a discount of 0.05% or higher available if you maintain a combined balance of $20,000 or more over three months.

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Fidelity has a significant difference in broker-assisted stock, ETF, and option trades, charging $32.95 compared to Merrill Edge's $29.95 service charge.

Fidelity's mutual fund fees can be quite steep, especially if you select non-Fidelity transaction-fee funds, which can cost $49.95 or more.

In contrast to Merrill Edge's $19.95 fee for no-load, transaction-fee funds, Fidelity's fee for the same type of funds is not specified in this comparison.

Fidelity's higher fees can add up quickly, making it essential to consider these costs when choosing a brokerage.

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Merrill Edge fund commissions are average, with an estimated $19.95 per transaction for a $2,000 US domiciled fund trade, but there are also more than 800 funds that are free to trade.

The competition, Fidelity, charges $37.5 per transaction, while Vanguard charges $20 per trade for investments under $500,000.

Merrill Edge bond commissions are low, with $0 commission for online trades of US Treasury bonds.

Here's a comparison of Merrill Edge fund fees with the competition:

Edge Bond and Options Commissions can add up quickly, with a $19.95 per bond fee for certain bonds, as seen in the article section on "Bond Commission Fees". This fee is charged in addition to the bond's purchase price.

For options trading, Merrill Edge charges a $6.95 commission per trade, with a $19.95 maintenance fee for accounts with less than $2,000 in equity. This fee is detailed in the article section on "Options Trading Fees".

These fees may seem small, but they can add up over time, eating into your investment returns.

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Merrill Edge bond commissions are a great deal for investors. Merrill Edge charges $0 for online trades of US Treasury bonds.

If you're looking to trade other types of bonds, Merrill Edge's fees are still competitive. For a $10,000 trade, Merrill Edge charges $0 for Treasury bonds, and $1 per bond with a $250 max for other bonds.

Here's a quick comparison of Merrill Edge's bond commissions with those of its competitors:

It's worth noting that these fees are calculated for a $10,000 trade, so the actual cost will depend on the specific trade you make.

Merrill Edge options commissions are quite low, which is great news for traders. Merrill Edge offers a competitive fee structure.

You can see that the estimated commission for 10 US stock index options contracts is $0.65 per contract. That's a very affordable price point.

If you're trading US stock options, you might be disappointed to know that Merrill Edge doesn't provide an estimated commission for opening 10 contracts. This information isn't available.

To compare Merrill Edge options commissions with those of Fidelity and Vanguard, let's take a look at this table:

As you can see, Merrill Edge's fees are generally lower than those of Fidelity and Vanguard.

The SEC has taken action against Merrill Lynch, ordering them to pay out a significant sum of money. They're being forced to cough up $9.7m in total.

Merrill Lynch has agreed to pay a $4.8m civil penalty, which is a pretty hefty fine. This is on top of the $4.1m they'll be giving up in profits from the alleged practice.

The SEC found that Merrill Lynch charged a hidden fee on around 15,000 currency exchanges in nearly 4,900 client accounts. This was over a period of about four years, from May 2016 through June 2020.

They also had to pay $760,000 in interest on top of that.

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