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When searching for a new brokerage account, Vanguard and Fidelity are the two most well-known brands in the industry.
Like us, you may be wondering how these two compare when placed side by side. We have pitted Vanguard against Fidelity in a head-to-head match to assist you in making an investment decision.
There’s one thing to get clear right upfront. Retirement giants Vanguard and Fidelity are both well-known; many 401(k)s use their proprietary mutual funds, and Fidelity is a top 401(k) record-keeper. (View our list of the best IRA accounts. ).
However, Fidelity offers strong trading platforms and tools to accommodate active traders as well. Not so much with Vanguard: The business doesn’t provide a trading platform. Thus, some readers might be able to end this comparison at this point: Are you a frequent stock or options trader? If so, fidelity is the solution.
When investors are comparing mutual funds, fees, account minimums, and investment offerings, there is tension between these two. For that, read below.
Note that while Fidelity and Vanguard both provide robo-advisor services, our focus is on their self-directed brokerage accounts. See our evaluations of Vanguard Digital Advisor and Fidelity Go to find out more about the robo-advisors.
Choosing the right brokerage firm is crucial for investors of all levels. Two of the most prominent names in the industry are Vanguard and Fidelity both offering a wide range of investment products and services. This comprehensive comparison will delve into the key differences between Vanguard and Fidelity helping you determine which firm aligns best with your investment goals and preferences.
Fees:
- Vanguard: Vanguard boasts a low-cost structure, with no commissions charged for trading stocks, ETFs, options, and most mutual funds. However, there is a $20 annual account fee, which can be waived by meeting certain criteria.
- Fidelity: Fidelity also offers commission-free trading for a wide range of assets. Additionally, it has no account fees, making it a more attractive option for investors with smaller portfolios.
Investment Options:
- Vanguard: Vanguard is renowned for its extensive selection of low-cost index funds and ETFs. This makes it a suitable choice for investors seeking a passive investment strategy.
- Fidelity: Fidelity offers a broader selection of investment options, including individual stocks, bonds, options, mutual funds, and ETFs. This diversity makes it appealing to investors with more active trading strategies.
Minimum Investment Requirements:
- Vanguard: Vanguard has minimum investment requirements for some of its funds, ranging from $1,000 to $100,000. However, it offers a $0 minimum account requirement.
- Fidelity: Fidelity has no minimum investment requirements for most of its accounts and funds, making it accessible to investors with limited capital.
Robo-Advisors:
- Vanguard: Vanguard offers Vanguard Digital Advisor, a robo-advisor service with a $3,000 minimum investment and a 0.20% annual advisory fee.
- Fidelity: Fidelity Go is Fidelity’s robo-advisor service, requiring no minimum investment and charging a 0.35% annual advisory fee for accounts under $50,000.
Advisory Services:
- Vanguard: Vanguard offers Personal Advisor Services, a hybrid robo-advisor service with a $50,000 minimum investment and a 0.30% annual advisory fee. It also has a more personalized Personal Advisor Select program for high-net-worth clients.
- Fidelity: Fidelity offers a range of advisory services, including digital, discretionary investment management with no minimum requirement and personalized financial planning advice for a $25,000 minimum.
Online and Mobile Experience:
- Vanguard: Vanguard’s online and mobile platforms are user-friendly and straightforward, catering to investors who prefer a simple and intuitive experience.
- Fidelity: Fidelity’s platforms offer a wider range of features and tools, appealing to experienced investors who value advanced charting and research capabilities.
Who Should Use Vanguard?
- Investors seeking low-cost index funds and ETFs.
- Investors with a passive investment strategy.
- Investors who prefer a simple and user-friendly platform.
Who Should Use Fidelity?
- Investors with a more active trading strategy.
- Investors seeking a wider range of investment options.
- Investors who value advanced charting and research tools.
Both Vanguard and Fidelity offer compelling advantages for investors. Vanguard is an excellent choice for investors seeking low-cost index funds and a user-friendly platform, while Fidelity caters to investors with a more active trading approach and a desire for advanced tools. Ultimately, the best choice depends on your individual investment goals and preferences. Carefully consider your needs and research each firm thoroughly before making a decision.
Fidelity at a glance
|
Account minimum |
$0. |
|
Stock trading costs |
$0. |
|
Options trades |
$0.65 per contract. |
|
Account fees (annual, transfer, closing, inactivity) |
None. |
|
Interest rate on uninvested cash |
4.97%. |
|
Number of no-transaction-fee mutual funds |
More than 3,300 no-transaction-fee mutual funds. |
|
Tradable securities |
• Stocks. • Corporate, municipal and government bonds. • Mutual funds. • ETFs. • Fractional shares. • Options. • FOREX. • Precious metals. • Bitcoin and Ethereum. |
|
Trading platform |
Fidelity.com and Active Trader Pro. Both free for all customers. |
|
Mobile app |
Available for iOS and Android; advanced features. |
|
Research and data |
Free and extensive. |
|
Customer support options (includes how easy it is to find key details on the website) |
Phone, email and live chat 24/7; more than 200 local branches. |
Fidelity is best for:
- Frequent traders.
- Beginner investors.
- Research and data.
- Retirement planning assistance.
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FAQ
How do I choose between Vanguard and Fidelity?
What is the downside to Fidelity?
Why Vanguard is the best?
Is Fidelity owned by Vanguard?
What is the difference between fidelity and Vanguard mutual funds?
Fidelity offers trading of more than 10,000 mutual funds from Fidelity and other companies. By comparison, Vanguard provides access to more than 160 Vanguard mutual funds and over 3,000 funds from other companies. Both Fidelity and Vanguard enable automated investing through robo-advisors.
Are Vanguard & Fidelity a good investment?
Vanguard and Fidelity make it easy to invest in their own funds, but they also offer thousands of funds from other asset managers. Both brokers also offer thousands of combined no-transaction-fee options to choose from in both index fund and actively-managed fund form — no loads, no transaction fees, and no commissions!
What is Fidelity & Vanguard?
In broad terms, Fidelity tries to offer a wide array of products for investors who want to trade or customize their allocations exactly. Vanguard was started in 1975 by John Bogle, who pioneered the index fund aimed at individual investors. The company operates more like a cooperative: It is owned by the shareholders of its mutual funds.
Which 401(k) is better Vanguard or fidelity?
There’s one thing to get clear right upfront. Both Vanguard and Fidelity are retirement powerhouses — their proprietary mutual funds line many 401 (k)s, and Fidelity is a leading 401 (k) record-keeper. (View our list of the best IRA accounts.) But Fidelity also caters to active traders, with robust trading platforms and tools.