Lowest Mutual Fund Commissions



I think most peoples first experience of the stock market is buying mutual funds. Usually you’re exposed to this via your bank but it won’t be long before you realize that they can be bought much cheaper elsewhere.

But where is the best place to buy mutual funds? Well you can continue to get them from your bank if you don’t mind paying the extra fee.

But there are a number of brokers out there that offer mutual funds at very competitive prices. We’ve reviewed all the top brokers to find out which one offers the highest number of No-Load No-Transaction Fee (NTF) funds and compared their commissions for other types of mutual funds.

So check out our review below and you’ll get a good idea which is the most economical broker for you to purchase mutual funds.

 

Mutual Fund Commissions

Fund Type Scottrade E*TRADE TD Ameritrade
Schwab
Fidelity
No-Load, No-Transaction Fee (NTF) Funds No Fee No Fee No Fee No Fee No Fee
No-Load Funds (not in NTF program) $17 $19.99 $49.99 $49.95 $75.00
Load Funds No Fee Buy – $17 Sell See prospectus for amount of load See prospectus for amount of load See prospectus for amount of load See prospectus for amount of load

 

Number of mutual funds
Scottrade E*TRADE TD Ameritrade Schwab Fidelity
14,500+ (2800 No Load No Fee Mutual Funds) 7600+ (1100 No Load No Fee Mutual Funds) 13,000+ (2172 No Load No Fee Mutual Funds) 14,500+ (2000 No Load No Fee Mutual Funds) 4600+ (1400 No Load No Fee Mutual Funds)

 

You can clearly see from the tables above that there’s a clear winner, Scottrade offer by far the most No-Load No-Transaction Fee (NTF) mutual funds. They also offer cheaper transaction fees for funds that are not in the NTF program.

They also charge a flat fee for loaded funds, which makes a refreshing change. Most brokers rely on the fees charged by the individual funds themselves, so naturally this fee varies depending on the fund you purchase.

Pros

  • No inactivity, account maintenance or hidden fees
  • No-fee IRAs
  • One of the highest customer satisfaction ratings according to JD Power and Associates
  • 500+ local branches
  • Great support for beginner investors with massive amount of educational resources
  • Visa check card and first order of checks is free
  • Only $500 minimum to open account
  • Free real-time streaming quotes and charts
  • Free dividend reinvestment for mutual funds (but not for stocks)

 Cons

  • Additional 0.5% of the principal value commission for stocks under $1
  • No electronic withdrawals (but can use debit card or checks)


Summary

Scottrade are a high quality broker, they have a very accomplished trading platform and recently reduced their fees to become much more competitive. Once Scottrade were one of the most expensive brokers but now charge fees that are at the bottom end of the scale. In fact Scottrade are the cheapest of the major blue chip brokers.

They have a network of over 500 local branches so you can always call in for assistance should you need it. In terms of investing in mutual funds they’re the best choice, they offer the highest number of No-Load No-Transaction Fee (NTF) mutual funds which is backed up by very competitive fees for funds outside the NTF program.

Add to that free dividend reinvestment and you have one fine broker both for investing in mutual funds and managing your IRA. In fact if mutual funds make up the majority of the investments in your IRA account they’ll make the best overall broker, but you need to way this up against more expensive stock trading fees.




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