Fidelity Investments and Vanguard, two of the best asset managers in the world, offer potential customers a comprehensive range of low-cost mutual funds. Nevertheless, in addition to this, they operate internet brokerages, which have a track record of scoring exceptionally well in the industry's annual ranking of the best brokers

Investors may find a wide selection of low-cost funds from two of the top asset managers in the world, Fidelity Investments and Vanguard. Yet, they also run internet brokerages, which consistently do highly in the industry's yearly survey of the best brokers.

According to the 2023 Awards, Fidelity is the top broker for inexperienced investors and retirees. Vanguard has hundreds of no-transaction-fee mutual funds and commission-free online trading of stocks and ETFs. Do you know which one is best for you? Which online broker is best for you depends on your needs and preferences. Some of the most frequently used features are compared below between Fidelity and Vanguard.

Cost Comparison: Vanguard vs. Fidelity

Even though Fidelity and Vanguard do a fantastic job keeping fees low, Fidelity comes out on top. For stock and ETF trades, both brokers charge $0 in commission, whereas for options trades, Fidelity charges $0.65, and Vanguard charges $1 for customers with less than $1 million in assets.

Fidelity and Vanguard are great options for folks saving for the future because they each provide more than three thousand mutual funds that don't charge commissions. Investing in index funds is a popular option, and all three give a variety of low-cost and even fee-free options.

Fidelity does not charge account fees, while Vanguard does for some accounts. Fidelity might be a better choice if you are starting and don't have a large nest egg to invest in.

Vanguard vs. Fidelity: Minimum Account

Anyone interested in opening an investment account with either Fidelity or Vanguard can do so at no cost and deposit any amount they like. Because of this, both brokers are highly recommended for novice traders.

Tradable Securities: Fidelity vs. Vanguard

The amount of securities available for trading at Fidelity and Vanguard is comparable. You may trade stocks, ETFs, mutual funds, bonds, and options with either broker.

Fidelity vs. Vanguard: Types of Accounts

Fidelity and Vanguard are good alternatives for opening an investment account, although Fidelity provides a little more variety. Both brokers offer access to the most common investment vehicles, such as taxable and joint accounts, IRAs, SEP IRAs, and 529 college savings programs for small businesses.

Vanguard Digital Advisor and Fidelity Go are two other robo-advisor platforms. In addition to traditional investment options, such as stocks and bonds, Fidelity also provides HSAs, which may be used to save money for future healthcare expenses, as well as trust and charity accounts.

Fractional Shares at Fidelity and Vanguard

Fidelity stands out since it allows clients to buy fractional shares while investing in stocks, ETFs, and reinvesting dividends. When buying new stocks or ETFs, Vanguard doesn't sell fractional shares; only whole claims are available. On the other hand, dividend reinvestment allows for fractional shares.

As the price of a single share of stock in major corporations like Alphabet, Amazon, and Tesla has risen to hundreds of dollars in recent years, fractional shares have become an increasingly important product offering.

Instead of keeping their money in the bank until they can buy a total share, investors may put their money to work by purchasing fractional shares in high-priced equities.

Fidelity vs. Vanguard Investing in Customers

Both brokers should be able to respond quickly to any questions you may have. Telephone help from Fidelity is accessible around-the-clock, while email and live chat are other communication channels.

You may also visit one of their over 200 branch sites nationwide to get your questions addressed in person. Phone support from Vanguard is accessible as well, but for a more restricted 12 hours each day, Monday through Friday. There is also an email address for inquiries to be addressed.

Conclusion

Investing with either broker is a good choice. Still, Fidelity comes out on top due to its slightly better pricing, a more comprehensive range of account options, and fractional share offering. Of the two, Fidelity is the better option if these characteristics are essential to you, but Vanguard is just a little behind.

The inability to purchase fractional shares is not a deal breaker if you have a sizable amount of assets already invested with Vanguard due to the possibility of waiving those costs. You may choose the best online broker by considering your priorities and needs. You are free to sign up for either or both if you take advantage of their many services.