Evaluating Merrill Edge as a Brokerage Firm

by Investing School on April 30, 2012

As often happens when a company changes hands, things change within the structure of the firm as well. In 2008 Merrill Lynch was acquired by Bank of America, along with numerous other financial institutions. BoA put its investment accounts under the new name Merrill Edge in 2010. Since then it has been running independently.

Application Process

The application process for a Merrill Edge account is online. The same basic information is requested as is with any other brokerage account and funds can be transferred into the new account from another existing account, check, cashier’s check or electronic transfer. Doubtless, each takes a certain amount of time, but estimates weren’t available at the website.

Pricing Structure

Pricing with Merrill Edge is a bit tricky, as it is on a tiered system when you are trading stocks and ETFs. Additionally, there are ways to gain free trades and occasional promotions. Here is a simplistic breakdown, but make sure to check before you commit.

  • Stocks or ETFs – balance under $250,000 or 0-119/0-29 trades per year/quarter: $8.95
  • Stocks or ETFs – balance $250K-$1M or 120+/30+ trades per year/quarter: $6.95
  • Stocks or ETFs – balance $1M + or 240+/60+ trades per year/quarter: $4.95
  • Stocks or ETFs – balance in $25,000 or more in your BoA, N.A. deposit accounts: 30 free equities trades per month
  • Options: $8.95, $6.95 or $4.95 + $0.75 per contract with the same stipulations as above
  • Self Directed Mutual Funds: 0.75% of gross proceeds
  • Representative Assisted Trades: +$44.95

As you can see, it gets complicated.


When trading without assistance it’s all about tools, and reportedly the tools with Merrill Edge are basic and unreliable. The platform used by Merrill Edge can’t keep up with those offered by other online brokerages and doesn’t always provide accurate information on the state of your accounts. This can be problematic if you trade based on what you think you have available rather than on what you actually have. Penalties can, and will, ensue.

The one bright spot in all the comments about the tools offered arrives when discussing the app available to iPad and iPhone users. Apparently the app is exceptional.

The Word Online

When you go in search of customer commentary the word isn’t good. There are a few compliments but the majority of online reviews by actual clients are negative. Consistent problems with order execution, trading fees and poor customer service turn up time and again.

The Pros and Cons

Even with the apparent challenges, Merrill Edge does offer some pros to investors. DRIPs are free, you can connect a free checking account and there are ways to cut your trading fees. For the large scale investor this brokerage may work.

On the down side are high fees, poor execution, the need to hold a $1M balance to make trading more affordable, technical issues and a poor trading platform.

To Sum It Up

For new or average investors Merrill Edge doesn’t offer as much as other online brokerage firms. Tiered fee structures are rarely an advantage to those who have limited funds to invest. Add reportedly customer service and a platform that is frequently inaccurate and difficult to manage and it seems that Merrill Edge has a long way to go.

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