Charles Schwab Review

Useability

Online brokers face strong competition. Schwab is a strong performer due to the company's willingness to listen and improve. It can take between 10 and 20 minutes to open an online account depending on what type of account you choose. Investors of all levels can navigate the different platforms easily. Schwab offers a variety of tools, including mobile and web platforms.

These platforms include:

• Schwab.com Website

• The Schwab Mobile trading app

• StreetSmartEdge is a cloud-based customizable trading software that can be used on desktops.

• Schwab Intelligent Portfolios is an automated investing tool that makes use of a robo advisor

Customers can access their portfolio performance and deposit checks from any mobile device. They also receive push notifications and alerts, get breaking news and trades. Schwab offers a holistic experience, allowing customers to view all their assets on the site. This includes assets that are not part of Schwab's platform.

Trade Experience

Schwab customers will find many useful tools and resources that can help them navigate the different platforms. Innovative technology enhances the user experience with features like real-time data streams, and the ability to convert screening results into a watchlist. Idea Hub allows you to generate trade ideas using different criteria. The data is kept updated throughout the trading day.

The charting capabilities are excellent overall. However, we found that the volume-weighted Average Price (VWAP), tool was lacking for active traders who might depend on it. StreetSmart Edge has a variety of chart analysis tools, including trend lines and other popular drawing options. Although the Schwab website does not allow customers to chart, they can still help their clients make informed decisions. Trade orders can also be placed in the StreetSmart Edge chart window. However, users of the mobile app cannot draw on or place other charting tools onto charts.

StreetSmart Edge recently received enhancements to its CNBC feed and quote bar, which improves the platform's customization. Customers can save customized searches, modify settings and create custom searches to customize the information they see in their account.

Mobile Trade Experience

It is easy to access your Schwab accounts via a mobile app. It is however somewhat limited as not all features available on the website and desktop software platforms are available through the app. You can only trade certain types of orders. The mobile app does not have drawing or charting tools, as mentioned previously.

The latest biometric technology is used in security features of the mobile app. Customers can access their accounts via their face ID, fingerprint or preset passcode. You can also deposit using the app. To make the deposit, take photos and follow the instructions. Select the account that you wish to deposit to, then take a picture of the check's front and back, verify that everything is correct, and then click submit.

Mobile apps default to the summary view which displays brokerage and futures totals. You can click on an account to view the position menu. You can view an index graph on the Markets page. You can also change the time frames to see the differences in the graph. You can also view how your investment is performing on different stock exchanges and indexes. StreetSmart Edge has more features than the mobile app. It may still be an excellent option for investors newer to the market or investors who don't want to be as involved in reviewing investments' performance.

A wide range of offerings

Schwab is a full-service broker that offers a wide range of investment options. Schwab will continue to expand its offerings as technology improves and as the demand for ESG investments grows, Schwab will also continue to offer new products. Both TD Ameritrade and Schwab customers now have access additional investment products. Active traders will now be able trade forex and futures after the integration of thinkorswim(r).

Schwab's offerings include:

• Stocks (Schwab holds over 3,000 U.S.-traded stocks)

• Swab holds over 2,000 Exchange-Traded Funds.

• Mutual Funds (Schwab offers more than 4,000 transaction-free, no-load mutual funds

• Penny stocks (OTCBB)

• Stocks and equity trading are available in international markets. Customers can trade seven currencies on 12 different global markets.

• Fixed income / Bonds

• Futures

• There are many options

• Automated Investing Through Schwab Intelligent Portfolios (Automated Investing Using a Robo-Advisor.

Types of Order

Charles Schwab offers all the basic order types, including market, limit and stop, as well as trailing stops. You can also order market if touched (MIT), Market on Close (MOC), and Market-on-Open (MOO) types orders. They also offer fill or kill (FOK), all or none (AON), and immediate or cancel orders (IOC). StreetSmart Edge customers can place more complex orders through the platform, including a limit order and an OCO contingent order.

Trade Technology

Charles Schwab uses a proprietary, wheel-based router to manage their orders. This allows for real-time execution quality review, monitoring volatile markets, and overseeing exchange outages.

Third-party wholesalers can route stock orders and options that are listed on multiple exchanges. This allows Schwab maintains its price advantage and provides customers cost savings. The Retail Execution Quality Statistics of Schwab for the 2nd Quarter of 2022 show an average execution time of 0.03 to 0.06 seconds, depending on order size. There was an average savings of $7.29 for orders between 100 and 499 shares.

Prices

Charles Schwab's gives customers detailed information about the costs of their products and services. Customers also have free access to news and educational resources. It has a history of lowering fees to keep pace with competitors. The recent elimination of the $30 per month NASDAQ TotalView(r), fee is a good example. Schwab has the highest margin trading fees of any company, but margin traders might need to conduct a cost-benefit analysis before making a decision on this service.

• Online listed stocks, ETFs and options are free of commission (base commission).

• Options cost $0.65 per contract. Multiple-leg options come with fees. The SEC charges an exchange fee, while Schwab charges the customer this fee.

• Fixed Income: There is no commission for Treasury bonds, Treasury bills, or Treasury inflation-protected security (TIPS). Secondary market bonds, such as municipal and corporate bonds, are subject to a $1 commission. The range of commissions is between $10 and $250.

• Margin rates are calculated based on your debit balance and Schwab's base interest. Schwab's current market rate are updated and posted on their website. Current rates for margin up to $25,000 are at 10.575%, while the rate for $100,000 is 9.075%.

• Mutual Funds: While there is no commission for mutual funds on Schwab's Mutual Fund OneSource platform (no commission), all other mutual funds are subject to a $74.95 transaction fee. Trades below $100 are exempt from the transaction fees.

• Trades on Canadian exchanges: A $6.95 fee is charged for international stocks. For foreign stock trades on the American OTC market, there is a $50 fee.

• Certain accounts require minimums and fees. Basic accounts are free of charge and do not require a minimum account balance. For investment accounts like the Schwab Intelligent Portfolios accounts, there are minimums and management fees. The basic Schwab Intelligent Portfolios account does not have any advisory fees or commissions. However, the account minimum is $5,000. Schwab Intelligent Portfolios Premium accounts have a $300 one-time fee and a $30 monthly advisory charge. The account minimum is $25,000. The Schwab Wealth Advisory account fee starts at 0.80%. It decreases with increasing assets. There is a minimum of $1 million. Fees for the Schwab Advisor Network account vary depending on the advisor. The account minimum is $500,000.

• Transfer funds are free, but wire funds from Schwab accounts are subject to fees. If the wire transfer is done online, it costs $15.

• For most basic accounts, there is a $25 fee for broker-assisted trading.

• There are no software access, maintenance, or inactivity fees.

• Deposits and withdrawals are free. Account closing costs are not included.

How this broker makes money for you and from you

Charles Schwab was the first online broker to offer commission-free trading for stocks and ETFs. The industry saw fierce competition for the opportunity to offer commission-free trades for stocks and ETFs. Although investors no longer have to pay fees for buying and selling shares, you need to be aware of the indirect costs involved in trading. Brokers must still make money.

• Payment for Order flow (PFOF). Although Schwab offers commission-free trading of stocks and ETFs it still charges for other types and services. Schwab receives orders flow payments (PFOF). These payments are rebates from liquidity providers or various exchanges. These payments are disclosed by Schwab in the Report of Routing Customers Orders. The 2nd quarter 2022 report is now available. Schwab earns $0.001 per share of PFOF on stock trading and $0.055- $0.60 per option contract. This is the lower stock side, and the middle for options brokers who accept PFOF.

• Portfolio Margining Some Schwab accounts are eligible for portfolio margining. This allows customers to keep overall margin costs and minimize risk for their portfolios. Schwab's margin rates may not be the lowest among their competitors.

• Securities Lending Customers who sign up for the Securities Lending Fully Paid Program can offer shares to a stock-loan program and get a portion of the income from the loan of the stock.

• Interest on Cash balances: Schwab earns an interest on cash balances that are greater than the amount actually held by customers. The cash is transferred to regular bank accounts and not money market funds. Through insurance policies Schwab has with Lloyds of London, bank account deposits can be insured at higher levels than FDIC levels. Customers may earn higher interest with money market funds. Customers should ensure that their funds are not placed in regular bank accounts which earn less interest.

• Price Improvement: Charles Schwab’s Order Execution Advantage refers to the way they carefully monitor and control the execution of orders. Schwab is known for executing orders at lower prices than the National Best Offer (NBB), market prices. Schwab reports that for orders ranging in size from 1 to 4999 shares of S&P 500 stocks, the price improvement ranges between 94.4% and 98%. The average execution speed is 0.03 to 0.06 seconds. Schwab reports that their customers received $522,000,000 in price improvements on equity and option orders during the second quarter 2022.

Account and Research Amenities

Charles Schwab is a leading brokerage firm that offers a wide range of services to a diverse client base. It offers many services and support to its customers. Schwab has extensive research capabilities. All customers have free access to the best third-party and proprietary research in the industry. Moody's and Morningstar are just a few of the third-party research agencies that Moody's, Credit Suisse, Credit Suisse, or Argus can access. Schwab's ETF research has been so strong that it has won the Best ETF Screeners category over the last several years.

Stock Screeners

Charles Schwab offers advanced screeners that include pre-built screening reports. Customers can build customized stock screens using various criteria, such as price performance, dividend yield, analyst ratings, financial strength and many more. There are 11 stock screens on www.schwab.com for Stocks/Equities and StreetSmart Edge offers 30 stock screening reports.

StreetSmart Edge offers an Idea Hub feature. Customers can use Idea Hub to generate trade ideas based upon their goals and other screening criteria. Customers who are guided by market volatility and investment earnings as well as their income goals can use Idea Hub.

ETF and Mutual Fund Screeners

Schwab's ETF screens are the best in class. Customers can access 16 ETF screens on Charles Schwab's website and 11 mutual fund screens. StreetSmart Edge has the ETF screener, while the mutual fund screener can be found on the website. The mutual fund and ETF screeners offer the ability to screen for socially responsible investment (SRI) which is a great feature. In StreetSmart Edge, customers can customize screens using various criteria. Schwab has Schwab Select List, where customers can search for prescreened mutual funds.

Option Screeners

Charles Schwab offers two types options screeners: predefined and customizable. Customers can specify criteria, such as volatility and assigned rate of return, in the customizable screeners. The customizable screeners have some of the same criteria as the stock screeners. Predefined screeners come with 10 strategies. Customers can change them as they please. The trade assessor allows customers to search for trades based upon their investment. It uses various criteria, such as profit percentage, maximum gain or loss, and assigned rate of return. The results allow customers to place orders. Full Option Chains allows customers view real-time quotes. StreetSmart Edge's Idea Hub helps customers find options trading opportunities.

Screeners for Fixed Income

Customers can choose a type of bond from the fixed income screener, including corporate, municipal or treasury. Secondary menus allow customers to view bonds by industry, sector or state. Customers can also filter by maturity dates, price, ratings, and other options. Schwab offers a CD and Treasury ladder builder. Customers can also screen bond ETFs.

Calculators and Tools

Schwab customers have many tools and calculators available to help them meet their needs. These calculators and tools cover many components, including tax efficiency, portfolio analysis, allocation, pricing, retirement, and retirement. Customers can also access tax-related reports easily.

Charting

Schwab's mobile app and website have limited charting capabilities. Schwab Mobile and StreetSmart Mobile do not allow customers to draw on the charts. StreetSmart Edge's chart analysis features also include trend lines and chart drawing. Schwab gives a brief tutorial on StreetSmartEdge's charting features. StreetSmart Edge allows customers to open order windows from created charts using the order entry tool. Recognia, a third-party website embedded within StreetSmart Edge, allows customers to identify chart patterns and price targets. It also lets them set time horizons. Customers can also keep a trading journal, and Schwab's Strategy Tester tool allows backtesting.

Trade Idea Generator

Customers can use the Idea Hub to get ideas about market areas using predefined screens. Volatility, earnings calendar, volume are some of the criteria. Schwab also offers options strategy finders that are based on the customer's expectations regarding risk, volatility and price movement.

News

StreetSmartEdge customers have access to an enhanced CNBC feed and can stream news, information, or get quotes. Customers can access real-time market data and breaking news via the mobile app. Associated Press, GlobeNewswire and Business Wire are just a few of the available services. Additional news and research are also available for a fee. Many of these services offer extended trial periods.

Research by a Third Party

All Schwab's platforms include a research component. This includes third-party research agencies such as Moody's or Morningstar. Customers can also find analyst ratings to help them make investments.

Cash Management

Charles Schwab offers two cash management options to customers: investment cash, savings and everyday cash. Savings and investment cash include high yield savings accounts, money market funds accounts, and certificates-of-deposit (CDs). Uninvested cash from Schwab retirement and brokerage accounts, as well as a high-yield checking account linked to Schwab One brokerage account are the everyday cash options.

Some accounts offer a sweep feature. However, it may not be as useful as you would like. Schwab does not offer the sweep feature on most accounts, new or old. However, some money fund accounts do have a sweep option. If you do not set up a sweep feature on accounts that have money fund accounts, any excess funds will not be automatically swept into your accounts. Schwab's bank sweep function for employee benefit plans automatically sweeps excess funds into Schwab Trust Bank accounts.

Fractional Dividend Reinvestment Plan - DRIP

Customers of Schwab can decide whether they wish to reinvest dividends from dividend-paying investments. Schwab customers can reinvest fractional dividends without having to have enough cash to purchase a whole share.

SRI/ESG Research Amenities

Schwab offers options for customers looking for socially responsible investments (SRI). Schwab's advanced mutual funds and ETF screeners include an SRI filter. Customers can use the SRI filter to create custom searches that restrict their search results to socially responsible investment. Schwab also offers separate managed accounts that are focused on socially responsible investing.

Portfolio Analysis

Charles Schwab offers a variety of portfolio analysis tools including calculators and various types. All Schwab platforms offer account balances. All account balances, portfolio performance analysis and portfolio performance analysis are available in real time. Schwab offers Portfolio Checkup, a portfolio performance analysis tool. Customers can also integrate other accounts into Portfolio Checkup. Customers can also use the tool for market benchmarks, risk-return analysis and to check individual investments' performance.

Customers can also keep a trading journal, and Schwab's Strategy Tester tool is available for backtesting. Schwab Intelligent Portfolios is an automated investing tool that makes use of a robo advisor. The robo-advisor continuously monitors your portfolios, and automatically rebalances them if necessary.

Education

Charles Schwab offers a variety of educational resources, including webinars, articles and videos. These educational resources cover many topics related to investing and trading. Two podcasts are produced by Schwab, Financial Decoder and Choiceology. This will please podcast lovers. Schwab introduced the Schwab Starter Kit 2021. This allows new investors to get top-notch investment education and receive $101 when they fund or open an account. Schwab Live Daily, an online collaboration with thinkorswim(r), celebrities, is streamed live on the Schwab website every Monday through Friday at 10 a.m ET. Schwab employees are the hosts of this show, who are experts in different areas of trading and investing.

Customer Service

Help is available for anyone who feels overwhelmed by the site's information. Schwab offers 24/7 customer support via phone and live chat. Schwab Assistant can be used on mobile apps to allow customers to voice-command to get the information they need or to ask questions. Many product pages include FAQs and links that provide additional information.

• You can reach customer service by phone, chat, or at a branch.

• For broker-assisted trades, customers can talk to a broker or financial advisor. This service is charged at a flat fee and the type of trade is considered.

• Chat provides quick and helpful support. Chat provided pleasant customer service. After we submitted our information, it took only two minutes for a chat representative to reach us.

• Near the bottom of most product pages, there is a section for common questions. You will also find links to additional information or resources.

• Customers can get a 100% satisfaction guarantee from Schwab Schwab offers a satisfaction guarantee for customers. Schwab will reimburse eligible fees if the customer isn’t satisfied with the services they received. Schwab's pricing guide lists fees such as commission fees and program fees that are eligible.

Security and reliability

Schwab's platforms meet industry standards.

• On the Schwab website, and on their mobile app, two-factor authentication is possible. Customers can log in to their Schwab accounts via the mobile app with their fingerprint, face ID or a preset password.

• Schwab's voice ID allows customers to access their accounts by using their voice. Customers need to simply say "At Schwab my voice is your password." Voice ID uses biometric voice technology and stores a digital copy of the customer's voice through a proprietary algorithm.

• Schwab's systems have an average platform performance of over 99.9%.

• Schwab was the victim of a security breach in May and December 2021. Schwab began to send out letters to customers in March 2022, informing them about the breach.

Transparency

Schwab offers clear, detailed information about their fees and pricing structure. You can also find out more about the investing costs for each type of investment. The cost breakdowns for each type of investment are explained and broken down by Schwab customers. Schwab allows everyone to see how they compare against their competitors by using comparison charts. Visitors to the website can view the differences in pricing, service and choice as well as trading.

Schwab devotes a whole section of its website to information on margins and loans. This section contains videos that explain what margin trading is, the risks and benefits of margin trading, as well as a hypothetical example with both gain and loss scenarios. It also includes Schwab's current margin rates and Schwab's requirements for margin lending. Common questions and other information are also included. Schwab provides regular updates on changes to their margin requirements.

Schwab gives details about their order routing process. This includes their emphasis on the customer and getting the best execution via their proprietary order routing system. Schwab's Report of Routing Customer Orders reveals their real-time price improvements and payment for order flow data (PFOF). The 2nd quarter 2022 report is now available.

There are many account types available

Charles Schwab offers a variety of services and accounts to suit the needs of both new investors and experienced investors. You can find the account that best suits your needs and goals based on your individual goals. Schwab offers details on each type of account and the benefits they offer, including trading and saving for education. The following account types are offered by Schwab:

• Taxable for an individual

• Global account (access 12 international markets in local currencies)

• Traditional individual retirement accounts (IRAs).

• Roth IRAs

• Inherited IRAs

• Simplified employee pension (SEP) IRAs

• Plans for individuals and businesses that are 401(k).

• 529 College Savings Plan and Education Savings Accounts (ESA).

• Trusts

• Custodial accounts

Final Verdict

Charles Schwab is a highly rated brokerage that offers services and products online and at their branches. Schwab was able to make a sound investment when they purchased TD Ameritrade in 2019. Combining the offerings of both companies will satisfy all types of investors, from active traders to those who want to only use robo-advisors and everyone who is passionate about investing with socially responsible companies. It's amazing how Schwab is able to stay on top of innovations as well as changes in society, the economy, and other factors. This is evident in the variety of services and products they offer and the clients they target.

Although the Schwab website may seem overwhelming to new investors, there are many high-quality resources available via multiple channels. Schwab offers many useful solutions. However, the broker doesn't offer fractional shares trading ETFs. Their margin rates are higher than other brokers' rates and there is no automated sweep feature for excess funds. Schwab still has room for improvement. Schwab has taken the right steps to be a top online broker and solid choice for investors, thanks to key elements that were brought over from thinkorswim(r).