Charles Schwab Review

The Charles Schwab brand has been a powerhouse in the world of investing since they first opened their doors in 1973. With almost $3 trillion in client assets, they’re practically a force of nature in finance. But behind the iconic name, is Charles Schwab the right trading choice for your needs?

I took an in-depth look at Charles Schwab. My complete review starts right now:

a modern investing approch

Trading Platforms

They offer two trading platforms, one for beginners and another for advanced users. Both platforms have no trade minimums or fees.

StreetSmart

This is the beginner’s platform. You manage your account, make trades, view real-time market moves and more. Here’s what the Dashboard looks like:

charles schwab account balances

StreetSmart Edge

This is the more advanced platform, for people who are already familiar with investing. With StreetSmart Edge, you get some extra features. The Balances Bar gives you a quick overview of your portfolio, orders and trade history. The Symbol Hub lets you research a new stock quickly.

StreetSmart Edge is designed for speed. You can quickly view your portfolio, research a commodity and then execute a trade. Because this platform is designed for the experienced investor, there’s more emphasis on action than education.

Here’s a look at part of the StreetSmart Edge Dashboard:

charles schwab stock buying screen orders

How Much Do Trades Cost?

Generally, Charles Schwab keeps prices low. Stocks have a flat-rate of $4.95 while options are $4.95 plus $.65 per contract. This is roughly half of what you’d pay at most other firms.

Schwab also offers 229 commission-free ETFs. Their ETF Portfolio Builder acts as a personal guide to building your ETF portfolio. They’re at the top of the industry here.

Unfortunately, their mutual funds leave something to be desired. With a $76 trade charge per buy ($0 sell), Charles Schwab has some of the highest rates in the industry for mutual funds.

What Does Charles Schwab Do Well?

Reputation

They’re a trusted name in investing. Unlike discount brokers, you won’t find hidden fees or limited points and times of contact. The team at Charles Schwab will be there when you need them.

They have over 25 experts to provide commentary about on-going market trends. You might even recognize their Chief Investment Strategist, Liz Ann Sonders, from her many appearances on major finance shows.

Their reputation and size give them some unique opportunities. For instance, their Schwab Live show streams live events with major guests. Their show following the 2016 election featured statistician Nate Silver.

Research

They’re some of the best around here. Not only do they have their own equity rating, but they also provide reports from most major rating agencies including Morningstar, Ned Davis, Market Edge, S&P Capital IQ and more. They use Reuters and Briefing.com for financial news and earnings reports.

Are investment screeners important to you? You’ll love their quarterly Lists. Pre-selected funds are divided by category so you can quickly find the picks which fit your trading strategy.

Customer Support

You can reach a real person on the phone or through chat. Their team is highly trained, friendly and available 24/7. Unfortunately, email is a different, slower story.

You can pop into one of the many local branches across the country. They offer workshops, financial consultation and more. If I have an especially complicated financial question, I prefer to deal with a real person one-on-one – and Schwab lets me do just that!

They have branches in every state and most major cities, including Anchorage:

Schwab brokerage branches

Where Does Charles Schwab Need to Improve?

No broker is perfect. Here are some issues Schwab could stand to improve:

Not-so-Great Account Minimums

A seasoned investor isn’t going to really think twice about Schwab’s $1,000 account minimum. But what about someone new to investing? They’ll likely be taken aback by a minimum in the four figures, especially when other brokers offer minimums of just a few hundred dollars.

High Transaction Fees

Can you avoid transaction fees with Schwab? Absolutely. They have a wide variety of funds which have no transaction fees.

What if you find a fund you like which isn’t on the “no transaction fee” list? Well, you better really like that fund, but the transaction fee will be a steep $76. This is one of the highest transaction fees you’ll find anywhere.

Is Charles Schwab the Right Choice for You?

I recommend Schwab for most investors, especially anyone a bit wary or unsure about online investing. Schwab has an excellent reputation. They’re an investing company you can rely on.

Their reputation and large size give them a host of advantages over the competition. Famous financial analysts create custom reports for investors. Plus, their Schwab Live offers a unique market view.

I don’t like their high transaction fees, but those can be avoided (although that does limit your picks somewhat). Their flat-rate of $4.95 is one of the lowest around. So you can save big with Schwab, but you have to be somewhat selective with the services you use.

Their Research is simply the best. If you prioritize screens and reports, you’ll love what Schwab delivers.

Finally, their support staff is great – but only by phone, office visit or chat. If you like to connect primarily by email, you might wait awhile. For some unexplained reason, they’re consistently slow to respond to emails.

If you’re looking for a trusted name in finance, Charles Schwab is a great choice. While they’re not perfect, they don’t have any outstanding flaws either. They’re reliable, easy to use and are suitable for most mainstream investors.

 

Summary

Charles Schwab has managed to keep up with the times. They offer low-cost trades, excellent research, and top-tier customer service. Recommended for the average investor who wants to learn while they earn.

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