Vanguard vs. Fidelity vs. Charles Schwab: Personal Investing Choices

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Difference between Vanguard, Fidelity and Charles Schwab

Anyone looking to make a financial investment will likely have heard of the three companies that we feature in this comparison article. After all, Vanguard, Fidelity and Charles Schwab have managed to garner a healthy reputation in the industry, and they each have their own strengths as well as weaknesses, as you will see here.

Fidelity
Charles Schwab

Profile

Vanguard is an investment management company based in the United States that has about $1.4 trillion total assets. The company provides a variety of products and services in addition to mutual funds, and it has numerous investors in the United States and other countries as well.

Fidelity is one of the biggest mutual fund and financial services firms in the world, and was founded in 1946 to primarily serve the needs of investors in North America. The company is also involved in venture capitalism via its Fidelity Ventures subsidiary.

Charles Schwab is a United States-based brokerage and banking firm founded by the man who bears the company name, Charles R. "Chuck" Schwab. Founded in 1971, the company was intended to be a traditional brokerage firm and investment newsletter publisher, although it later expanded to include discount brokerage services.

Primary Services

Vanguard offers a variety of shared management, marketing, and distribution services, although it is a bit different from other mutual-fund companies since it is under ownership of its own funds.

Fidelity offers a variety of fund distribution services in addition to investment advice, as discount brokerage, retirement, and wealth management services. The company is also involved in securities execution and life insurance among other services.

Charles Schwab offers pretty much the same services as traditional brokerage firms, although they charge much lower commissions and fees. The company also provides a variety of investment research, mutual fund, bond trading, and mortgage services.

Other Interests

In addition to its primary services, Vanguard also offers variable and fixed annuity services, educational accounts, financial planning, asset management and more.

Fidelity for its part provides transportation services via its BostonCoach network, and it also has a luxury hotel and even an employment agency. The company also owns stock in a telecom/data center firm based in Europe, the COLT Telecom Group, and MetroRED and KVH in South America and Japan respectively, although it has since given up its stock in MetroRED.

As for Charles Schwab, the company acquired the SoundView Technology Group in 2003 to the tune of $345 million. This enabled the company to provide equity research services alongside its range of trading services.

Similarities and Differences

Vanguard

  • An investment management company based in the United States that has about $1.4 trillion total assets
  • Has numerous investors in the United States and other countries

Fidelity

  • One of the biggest mutual fund and financial services firms in the world
  • Primarily services the North American market
  • Offers a variety of fund distribution services as well

Charles Schwab

  • A United States-based brokerage and banking firm
  • Later expanded to include discount brokerage services
  • Acquired the SoundView Technology Group in 2003

Which one makes more money for their investors?
  • Vanguard
  • Fidelity
  • Charles Schwab
 
 

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