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Robinhood, Vanguard and Fidelity are three popular brokerage platforms, but they serve different types of investors. Robinhood is built around simple, low-cost trading and direct crypto access, while Vanguard is best known for low-cost index funds and long-term passive investing. Fidelity offers the broadest mix of brokerage accounts, retirement tools, research, cash management and investor education. Comparing Robinhood vs. Vanguard vs. Fidelity can help you decide which platform best fits your investing style, account needs and long-term financial goals.
For help managing your portfolio, consider working with a financial advisor.
Robinhood vs. Vanguard vs. Fidelity: Side-by-Side Comparison
Robinhood, Vanguard and Fidelity all offer brokerage accounts, but each platform is built around a different type of investor. Robinhood emphasizes simple, low-cost trading and direct cryptocurrency access, while Vanguard is best known for low-cost funds and long-term passive investing. Fidelity offers the broadest mix of account types, research tools, retirement resources and investment options.
The chart below compares the three platforms by fees, minimums, investment choices, advisory services and best use case.
| Feature | Robinhood | Vanguard | Fidelity |
|---|---|---|---|
| Best For | Beginner investors who want a simple trading app, low barriers to entry and direct cryptocurrency access | Long-term investors who prefer low-cost ETFs, mutual funds and passive investing | Investors who want a full-service brokerage with broad account options, research tools and low fees |
| Account Minimum | No minimum to open a taxable brokerage account; fractional shares available starting at $1 | Many mutual funds require minimum investments, often around $3,000; Vanguard ETFs generally only require the cost of one share | $0 minimum to open standard brokerage accounts, IRAs and many mutual funds |
| Trading Fees | No commissions for stock and ETF trades; Robinhood Gold is available for a monthly fee | No commission on Vanguard mutual funds and ETFs, along with many non-Vanguard funds when traded online | No commissions for stocks, ETFs and many mutual funds; options contracts carry a per-contract fee |
| Investment Options | Stocks, ETFs, options, ADRs and cryptocurrencies; does not support mutual funds or bonds | Strong selection of Vanguard mutual funds and ETFs, plus access to stocks, ETFs and advisory services | Stocks, ETFs, bonds, mutual funds, IRAs, 529 plans, robo-advisor services and cash management |
| Crypto Access | Offers direct cryptocurrency trading | Does not offer direct cryptocurrency trading | Offers broad brokerage services, but crypto access is more limited than Robinhood |
| Retirement Accounts | Offers retirement account options, but with a narrower planning ecosystem than Fidelity or Vanguard | Strong fit for retirement investors who want low-cost funds and passive investing | Offers IRAs, 401(k)s, 529 plans, robo-advisor accounts and retirement planning tools |
| Mobile Experience | Streamlined app and desktop experience; designed for quick, simple trading | Mobile app is available, though user experience may vary by device | Robust web and mobile platforms with educational resources, research and planning tools |
| Advisory Services | More limited than Vanguard or Fidelity | Offers robo-advisor and personal advisor services, subject to minimums | Offers robo-advisor services and a wide range of planning tools |
| Main Strength | Ease of use, low entry point and crypto access | Low-cost index investing and long-term passive investment options | Broadest mix of accounts, tools, education and investment options |
| Main Limitation | Limited mutual fund, bond and advanced planning features | Higher minimums for many mutual funds and less appeal for active traders | More comprehensive platform may feel more complex than Robinhood |
Overview of Robinhood vs. Vanguard vs. Fidelity
Robinhood has been in business for almost a decade. Founded on the idea of democratizing investment access, the company has experienced more publicity over the last several years for its trading activity. It is currently focused on enhancing its services according to customer feedback. Robinhood investment accounts feature a $1 minimum with low fees but limited trade functionality compared to its competitors.
Vanguard has carved out a space in the market through its low fees for exchange-traded funds (ETFs) and mutual funds. In addition, its investment funds are available to clients using other brokerage firms. However, it is less apt for buying individual stocks.
Founded in 1946, Fidelity is the longest-standing company of the three. It brings together almost every financial service customers could need under one roof. Plus, it charges low to no fees for a swath of asset types and provides an impressive array of free educational resources.
Robinhood vs. Vanguard vs. Fidelity: Fees
Most investment firms have made concentrated efforts to reduce fees for clients. As a result, there are typically minimal charges assessed by all of these firms, although they vary between Robinhood vs. Vanguard vs. Fidelity.
Robinhood
Robinhood does not charge fees or commissions to trade, and there are no inactivity fees, no fees for moving money in or out of your account and very few non-trading fees.
Instead, Robinhood makes money by pocketing the small difference between the buying and selling price of an asset. This generates very little money, typically only pennies or less per share traded, but over millions of transactions for those pennies add up. Robinhood Gold also offers margin trading to subscribers who pay a $5 monthly fee, which allows margin trading with rates at a flat 5% for balances up to $50,000, with a variable base rate of 3.35% for uninvested cash.
Vanguard
When trading Vanguard mutual funds and ETFs, you will not face any brokerage commission fees on those trades. You also avoid commission charges on hundreds of non-Vanguard ETFs and mutual funds when you buy online.
Minimum balances for mutual funds range from $1,000 to $100,000. The firm also lowered the minimum investment on many low-cost Admiral Shares index mutual funds, from $10,000 to $3,000.
Fidelity
Fidelity lets customers trade stocks, ETFs and bonds free of charge. There are several thousand no-fee mutual funds. Fidelity charges $75 to trade funds that are not on its no-fee list. Options trading costs $0.65 per contract. There is a zero expense ratio for four Fidelity funds.
The Depository Foreign Trust Company foreign settlement fee is $50 per trade. Fidelity’s margin interest rates follow standard margin interest tiers, with a base rate as high as and even above 12.5%. Its lowest rate is for margins of $1 million or more.
Robinhood vs. Vanguard vs. Fidelity: Services & Features
Although each company offers various services, they focus on different areas.
Robinhood
Robinhood has the most truncated services of the three, with one exception: it allows investors to put money in cryptocurrencies. In contrast, Vanguard does not offer cryptocurrency.has some access to specific crypto funds and companies, but not the currency itself. Robinhood allows investors to trade stocks with a streamlined app but does not support mutual funds, bonds and many foreign stocks. However, in July 2022, the company launched over 300 American Depositary Receipts (ADRs), bringing the total number of ADRs available to more than 650.
As for SIPC protections, Robinhood covers customers up to $500,000 (including $250,000 for claims for cash). Its total excess insurance policy protects securities and cash up to an aggregate of $1 billion and is limited to a combined return to any customer of $50 million in securities, including up to $1.9 million in cash.
Lastly, Robinhood provides a financial news and education podcast, along with newsletters and videos. It is also beefing up its free online educational resources to help with your investing journey.
Vanguard
Vanguard emphasizes passively managed funds with minimal fees. That said, you can take control of trading as you would with other investment accounts or use a robo-advisor. Unlike Fidelity, it does not offer a bank account. However, both companies sport ample, free learning resources. Finally, Vanguard’s customer service is available by phone Monday through Friday, 8 a.m. to 8 p.m. ET.
Fidelity
Fidelity offers 401(k)s, individual retirement accounts (IRAs), 529 plans and a robo-advisor account. It also offers banking through its cash management account. For support, its customer service is available at all hours by phone. Its live chat feature is open 8 a.m. to 10 p.m. Monday through Friday and 9 a.m. to 4 p.m. Saturday and Sunday ET. Clients can receive help via Twitter, Facebook and Reddit.
Robinhood vs. Vanguard vs. Fidelity: Minimum Investment Requirements
Minimum investment requirements can make or break the decision to open a new brokerage account, especially for new investors. Fortunately, Fidelity offers $0 minimums to open a standard brokerage account, making them ideal for beginner investors or those starting with smaller balances. To begin investing in crypto, it only takes $1 to make your first trade.
Robinhood
Robinhood has no minimum investment requirement to open a taxable brokerage account. Users can start investing with just $1, thanks to fractional share trading. Robinhood Gold, the platform’s premium subscription, also has no minimum balance requirement beyond the $5 monthly fee, However, margin trading does require a minimum balance of $2,000 or 100% of the security’s purchase price.
Fidelity
Fidelity also offers $0 minimums to open standard brokerage accounts, IRAs and many of its mutual funds. Additionally, it provides access to fractional shares and zero-expense-ratio index funds with no minimum investment. However, some third-party mutual funds available on Fidelity’s platform may carry higher minimums or transaction fees.
Vanguard
Vanguard is slightly different in that it imposes minimum investment thresholds for many of its mutual funds.
- The standard minimum for most Vanguard mutual funds is $3,000, including many of the popular Admiral Shares index funds.
- Vanguard ETFs generally have no minimum investment, aside from the cost of a single share, making them more accessible.
- Vanguard’s robo-advisor service, Digital Advisor, requires a minimum of $100 in assets, while Personal Advisor Services require at least $50,000 to enroll.
If you are looking for the lowest barrier to entry, Robinhood and Fidelity offer the most flexible starting points. For investors who want to take advantage of Vanguard’s low-cost mutual funds, be prepared for higher initial investment requirements.
Who Should Use Robinhood, Vanguard and Fidelity?
While all three companies allow customers to trade stocks, their key differences draw varying investor types.
Investors looking for a simplified, inexpensive method for stock trading may want to consider Robinhood. Its streamlined app makes trading a snap and keeps costs down. In addition, Robinhood is the only company of the three that gives direct access to cryptocurrencies. However, investors with an eye for mutual funds, bonds and foreign stocks may want to look elsewhere.
Although Robinhood can be a great place for new investors to start, Fidelity’s services also have broad appeal. With accessible robo-advisor accounts, minimal fees and excellent user experience on both mobile and desktop, someone looking to put their first dollar in the stock market can feel as comfortable as a seasoned investor.
Vanguard promotes an inexpensive set-it-and-forget-it style of investing. Investors wanting passive management should look no further, as Vanguard’s investment funds are so popular that non-client investors often buy into them.
Bottom Line
As an individual investor, you can ensure your online brokerage account meets your needs by virtue of the sheer amount of options available today. When comparing Robinhood vs. Vanguard vs. Fidelity, Robinhood stands out for its inexpensive stock and cryptocurrency trading services and educational resources for new investors. Fidelity is a financial one-stop shop and offers its clients excellent support, education and low fees. However, if the thought of employing a sophisticated investment strategy gives you hives, Vanguard might be the best option for you with low-cost passively managed funds.
A financial advisor can help you create a personalized investment plan.
Investing Tips
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