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Matt is a Certified Financial Planner™ and investment advisor based in Columbia, South Carolina. He writes personal finance and investment advice for The Ascent and its parent company The Motley Fool, with more than 4,500 published articles and a 2017 SABEW Best in Business award. Matt writes a weekly investment column ("Ask a Fool") that is syndicated in USA Today, and his work has been regularly featured on CNBC, Fox Business, MSN Money, and many other major outlets. He’s a graduate of the University of South Carolina and Nova Southeastern University, and holds a graduate certificate in financial planning from Florida State University.
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If you're looking for a new brokerage account to buy and sell stocks and other investments, there is no shortage of choices available to you. Two of the most popular brokerages right now are Merrill Edge, which is Bank of America's brokerage arm, and Robinhood, which pioneered zero-commission investing and a user-friendly approach to buying stocks.
While both of these are solid choices for many people, neither one is a great fit for everyone. There are some big differences between the two, and in this Merrill Edge vs. Robinhood comparison, we'll take a closer look at these, as well as the similarities, to help you determine which (if either) is the best option for you.
4.5/5
Our ratings are based on a 5 star scale.
5 stars equals Best.
4 stars equals Excellent.
3 stars equals Good.
2 stars equals Fair.
1 star equals Poor.
We want your money to work harder for you. Which is why our ratings are biased toward offers that deliver versatility while cutting out-of-pocket costs. = Best = Excellent = Good = Fair = Poor
Rating image, 4.5 out of 5 stars.
4.5/5
Our ratings are based on a 5 star scale.
5 stars equals Best.
4 stars equals Excellent.
3 stars equals Good.
2 stars equals Fair.
1 star equals Poor.
We want your money to work harder for you. Which is why our ratings are biased toward offers that deliver versatility while cutting out-of-pocket costs. = Best = Excellent = Good = Fair = Poor
Commissions
$0 for stocks, ETFs, and options; up to $6.99 monthly for Robinhood Gold
Robinhood does something we typically don't see from stock brokers. It matches all customer IRA deposits 1%. It matches Robinhood Gold members deposits 1% and 3% on taxable and retirement accounts. It's the opposite of a commission: it's extra cash in your accounts. The catch is you need to keep deposits in Robinhood accounts for years to earn your full match. It's worth keeping in mind when weighing Robinhood's fees vs. other brokers'.
Merrill Edge vs. Robinhood: Commissions & fees
Like most brokers, both Merrill Edge and Robinhood offer zero-commission stock trading, and no monthly maintenance fees. But that's where the similarities end on fee structures.
Robinhood has a big advantage for options traders, as it is one of the only brokers where investors can buy and sell options commission-free. Merrill Edge charges a per-contract fee of $0.65, which is in line with most of its peers. Plus, Robinhood offers commission-free cryptocurrency trading, while Merrill Edge doesn't offer cryptocurrencies at all.
On the other hand, Merrill Edge has a standard $19.95 commission for mutual fund investments and offers thousands of funds on a no-transaction-fee (NTF) basis, while Robinhood doesn't support mutual fund investments at all.
It's also worth noting the difference in account transfer fees, as there may come a time when you want to move your account to another broker. Merrill Edge charges a $49.95 fee for a full account transfer, while Robinhood is a bit higher at $100.
Merrill Edge
Robinhood
Stock & ETF commissions
$0
$0
Options commissions
$0.65/contract
$0
Crypto commissions
N/A
$0
Mutual fund commissions
$19.95
N/A
Account transfer fee
$49.95
$100
Account maintenance fee
$0
$0, or $5 monthly for Robinhood Gold
Data sources: Merrill Edge and Robinhood. Note: All commissions are for online or mobile trades. Broker-assisted transactions may have higher fees.
Merrill Edge vs. Robinhood: Investments available
Merrill Edge and Robinhood both offer stocks, ETF, and options on their respective platforms, but that's where the similarities end.
For one thing, Robinhood offers the ability to buyfractional shares of stock, which can be a big perk for newer investors who may not have enough available cash to buy a full share of some of their favorite companies. Robinhood also offers the ability to buy and sell several different cryptocurrencies, and most bank-affiliated brokers like Merrill Edge do not.
On the other hand, Merrill Edge is the only one of the two that offersmutual funds and bonds through its platform. And because Merrill Edge is part of Bank of America, investors can buy CDs if they want a stable income investment.
It's also worth pointing out that neither platform offers futures or foreign currency (forex) trading, so if these are part of your investing strategy, you'll need to look elsewhere.
Merrill Edge
Robinhood
Stocks and ETFs
Yes
Yes
Fractional shares
No
Yes
Options
Yes
Yes
Mutual funds
Yes
No
CDs
Yes
No
Bonds
Yes
No
Futures
No
No
Crypto
No
Yes
Currencies (Forex)
No
No
Data sources: Merrill Edge and Robinhood.
Alternatives to Consider
We recommend comparing brokerage options to ensure the account you're selecting is the best fit for you. To make your search easier, here's a short list of our best trading platforms of 2024.
Account
Fees
Account Minimum
Rating image, 4.5 out of 5 stars.
4.5/5
Our ratings are based on a 5 star scale.
5 stars equals Best.
4 stars equals Excellent.
3 stars equals Good.
2 stars equals Fair.
1 star equals Poor.
We want your money to work harder for you. Which is why our ratings are biased toward offers that deliver versatility while cutting out-of-pocket costs. = Best = Excellent = Good = Fair = Poor
4.5/5
Our ratings are based on a 5 star scale.
5 stars equals Best.
4 stars equals Excellent.
3 stars equals Good.
2 stars equals Fair.
1 star equals Poor.
We want your money to work harder for you. Which is why our ratings are biased toward offers that deliver versatility while cutting out-of-pocket costs. = Best = Excellent = Good = Fair = Poor
$0 for stocks, ETFs, and options; up to $6.99 monthly for Robinhood Gold
4.5/5
Our ratings are based on a 5 star scale.
5 stars equals Best.
4 stars equals Excellent.
3 stars equals Good.
2 stars equals Fair.
1 star equals Poor.
We want your money to work harder for you. Which is why our ratings are biased toward offers that deliver versatility while cutting out-of-pocket costs. = Best = Excellent = Good = Fair = Poor
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Merrill Edge vs. Robinhood: Account types available
Robinhood offers more account types than it used to. You can open a taxable brokerage account, a Roth IRA, or a traditional IRA. Robinhood Gold members can apply for the Robinhood credit card to open a credit account. Robinhood's IRAs are unique in that Robinhood offers customers 1% match on deposits. So when you deposit $1,000, Robinhood adds $10.
Merrill Edge offers a wide variety of account types that will meet the needs of most customers. In addition to standard brokerage accounts, Merrill Edge allows customers to open joint accounts, retirement accounts (including small business accounts like SEP IRA and SIMPLE IRA), custodial accounts like UGMA and UTMA, as well as 529 college savings plans.
What's more, because it is a subsidiary of Bank of America, Merrill Edge investors can open and integrate Bank of America checking and savings accounts. Both can be accessed through the Merrill Edge desktop and mobile portals, and money can be seamlessly transferred between brokerage and bank accounts. It's a convenient all-in-one offering that Robinhood lacks.
Merrill Edge vs. Robinhood: Mobile app and trading platforms
Both Merrill Edge and Robinhood have highly rated apps that are functional and easy to use, although Robinhood is clearly the mobile-first platform. Investors who prefer to use an app to simply buy and sell stocks and options often find Robinhood to be one of the most user-friendly apps in the market.
Merrill Edge's investing app holds ratings of 4.6 and 3.3 out of 5 stars on the App Store and Google Play store, respectively. Robinhood's ratings are 4.2 and 4.1, but with a big asterisk, as its ratings were significantly higher prior to the "meme stock" craze of early 2021, when it was forced to suspend trading in certain volatile stocks to the disappointment of many customers.
Merrill Edge reviews often call out the ability to seamlessly integrate with other Bank of America accounts and the many features of the app. Robinhood reviews often cite the user-friendliness of the app.
Robinhood offers lots of educational investment articles through Robinhood Learn, its educational desktop platform. Articles are bite-sized and plentiful. That said, Robinhood's advanced mobile and desktop charts are limited to Gold subscribers. Merrill Edge offers the MarketPro desktop trading platform that offers a fully customizable trading layout (it comes with plenty of bells and whistles) at no added cost, which might be more appealing to sophisticated investors.
Both of these are excellent brokerage options, but they are clearly targeted to different types of customers. Merrill Edge is the more well-rounded of the two, aiming to provide investment solutions that meet the needs of most investors. Robinhood caters to active traders, though members may also prefer it for its unique IRA match, especially Gold members.
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4.5/5
Our ratings are based on a 5 star scale.
5 stars equals Best.
4 stars equals Excellent.
3 stars equals Good.
2 stars equals Fair.
1 star equals Poor.
We want your money to work harder for you. Which is why our ratings are biased toward offers that deliver versatility while cutting out-of-pocket costs. = Best = Excellent = Good = Fair = Poor
Bottom Line
Robinhood is a simple, low-cost brokerage with a few rare perks. What it lacks in customer service it provides in a smooth in-app experience. Without membership, you will lack research resources but still be able to trade affordably. With a membership, you can earn 3% and 1% match on IRA and taxable deposits. The app grows fast -- new perks are being released at a rapid pace.
Merrill Edge offers customers fraud protection. If someone else uses your account without permission, you're covered. You can enable authorization codes, which add another layer of security to your account.
Yes. It's not quite as user-friendly as Robinhood, but few apps are. Merrill Edge is special in that it integrates with Bank of America accounts to offer users an all-in-one bank brokerage platform. Beginner investors will enjoy Merrill Edge's commission-free stock trading; it's cheap to trade small amounts. Just know Merrill Edge doesn't offer fractional share trading; you can't buy fractions of stocks.
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We're firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers. The Ascent, a Motley Fool service, does not cover all offers on the market. The Ascent has a dedicated team of editors and analysts focused on personal finance, and they follow the same set of publishing standards and editorial integrity while maintaining professional separation from the analysts and editors on other Motley Fool brands.
Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Bank of America is an advertising partner of The Ascent, a Motley Fool company. Cole Tretheway has no position in any of the stocks mentioned. Matt Frankel has positions in Bank of America. The Motley Fool has positions in and recommends Alphabet, Bank of America, Best Buy, and Target. The Motley Fool has a disclosure policy.
Robinhood disclosure
All investments involve risk and loss of principal is possible.
Securities are offered through Robinhood Financial LLC, member FINRA/SIPC. Cryptocurrency services are offered through an account with Robinhood Crypto, LLC (NMLS ID 1702840). Robinhood Crypto is licensed to engage in virtual currency business activity by the New York State Department of Financial Services. Cryptocurrency held through Robinhood Crypto is not FDIC insured or SIPC protected. For more information see the Robinhood Crypto Risk Disclosure.
Trades of stocks, ETFs and options are commission-free at Robinhood Financial LLC. Other fees may apply. Please see Robinhood Financial’s Fee Schedule to learn more.
Fractional shares are illiquid outside of Robinhood and are not transferable. Not all securities available through Robinhood are eligible for fractional share orders. For a complete explanation of conditions, restrictions and limitations associated with fractional shares, see the Fractional Shares section of our Customer Agreement.
Robinhood Gold is an account offering premium services available for a $5 monthly fee. Not all investors will be eligible to trade on Margin. Margin investing involves the risk of greater investment losses. Additional interest charges may apply depending on the amount of margin used. Bigger Instant Deposits are only available if your Instant Deposits status is in good standing.
E*TRADE services are available just to U.S. residents.
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