Based on their assets under management (AUM), the biggest four brokerage firms in the U.S. are Charles Schwab, Vanguard, Fidelity, and JP Morgan.
Below is a short analysis of each brokerage's products, services, and fee structures as of May 2024. They are listed in no particular order.
Key Takeaways
- Charles Schwab had $8.85 trillion under management and 35 million active brokerage accounts.
- Vanguard had $8.2 trillion in managed assets with over 50 million active accounts.
- Fidelity Investments had $5.3 trillion under management and about 50 million active accounts.
- JP Morgan managed 3.6 trillion in assets and about 60 million accounts, which include its banking clients.
Charles Schwab
- Assets under management: $8.85 trillion
- Number of accounts: 35.4 million
Charles Schwab, founded in 1971 and based in San Francisco, is one of the leading investment brokerages and IRA custodian firms in the U.S.
As of May 2024, Charles Schwab held $8.85 trillion in client assets, with a total of 35.4 million active brokerage accounts. It also operates Schwab Bank, one of the largest banks in the U.S., which allows its brokerage clients to link their trading accounts with a checking account. The company also had 1.9 million active banking accounts.
The firm offers clients a variety of investment products, including stocks, mutual funds, exchange-traded funds (ETFs), money market funds, fixed-income products, options, futures, insurance, and annuities. Clients can also invest in Schwab's proprietary products and other third-party investments.
Charles Schwab's Fee Structure
Schwab, the country's first discount brokerage, has consistently been rated one of the cheapest brokerage firms in the U.S. In October 2019, Schwab cut commissions to zero from $4.95 for all U.S.- and Canadian-listed stocks, ETFs, options online, and mobile trades. Online options trades have a standard $0.65 per contract fee.
The operating expense ratio (OER) fees for actively managed mutual funds at Schwab range from 0.21% to 1.09%. Fees for passively managed mutual funds can range from 0.02% to 0.39%. Annual portfolio management fees at Schwab start at 0.80% for the Schwab Wealth Advisory account. These fees decrease for clients with higher asset levels.
The firm also offers clients a worry-free, passive approach to investing through its robo-advisor service called Intelligent Portfolios. The online platform provides clients with an automated experience, giving them access to a series of ETFs that rebalance per the client's investment goals. The service requires a minimum $5,000 investment and comes with no advisory or commission fees.
In 2019, Charles Schwab announced the acquisition of TD Ameritrade in a stock transaction valued at approximately $26 billion. The last client account from TD Ameritrade was migrated to Schwab in May 2024.
Vanguard
Started by John Bogle in 1974, Vanguard's business model is unique in that it is owned by its investors. Those who invest in funds managed by the firm become owners of the company. Well-known for its role in creating index mutual funds for individual investors, the brokerage was quickly mimicked by other firms.
Vanguard was among the first to adopt an online portal for investors in 1995, allowing investors access to accounts, services, and educational materials.
Vanguard's Fee Structure
Vanguard has always been proud of its low-fee services. It offers ETFs and mutual funds with no additional fees for online transactions, although there are expense ratios for managing the funds.
Options exercises and assignments are $1 per contract for accounts with less than $1 million, $0 for the first 25 trades, and $1 for all trades after that (accounts of $1 to $5 million). Accounts with more than $5 million are charged $0 for the first 100 trades, and $1 per contract for all following contracts.
Fidelity Investments
- Assets under management: $5.3 trillion
- Number of individual investors: 50 million +
Fidelity Investments is one of the nation's largest keepers of 401(k) retirement savings plans. Founded in 1946 as Fidelity Management & Research, the company is based in Boston.
According to the company's website, Fidelity had $13.7 trillion in customer assets as of May 18, 2024, with more than 50 million individual investors.
The firm also offers investments in Fidelity ETFs, mutual funds, and other products.
Fidelity Investments' Fee Structure
Fidelity touts its zero account fees and no minimums to open a retail brokerage account, including IRAs. Following Schwab's lead, it also offers commission-free stock, ETF, and options trades. Options trades also have $0 commissions plus a standard $0.65 per contract fee.
There are no minimums to invest in Fidelity mutual funds. Fidelity doesn't charge an expense ratio fee for certain proprietary mutual funds and offers hundreds of other funds with no transaction fees.
Portfolio advisory service fees range from 0.20% to 1.50% based on the amount invested. Minimum investments range from $50,000 to $500,000 based on the investment options. For its automated Fidelity Go service, the firm charges a 0.35% advisory fee for balances exceeding $25,000 but requires no minimum to open an account.
Note
Through its mutual funds and other advisory services, Fidelity has tens of millions of non-brokerage customers.
JP Morgan
- Assets under management: $3.6 trillion
- Number of accounts: 80 million
The oldest firm on this list, JP Morgan Chase & Co traces its roots to the late 1700s. Its current form is a culmination of many businesses, banks, and financial service providers it has combined with over the years.
The bank's investment services offer exchange-traded funds and mutual funds, and clients can choose between self-directed investments, using the services of a team of advisors, or having a dedicated advisor.
JP Morgan's Fee Structure
JP Morgan personal account annual fees start at 0.6% for investments between $25,000 and $249,000. The fee lowers to 0.5% if your account balance is between $250,000 and $1 million and 0.4% if it's more than $1 million.
Dedicated advisor fees are higher due to the more personal services and different programs to choose from.
The Core Advisory Portfolio has a fee of 1.45% with a minimum investment of $10,000. The Mutual Fund Advisory Portfolio and Advisory Program have minimum investments of $50,000 and a fee of 1.45%.
The Fixed Income Advisory Program requires a minimum investment of $100,000 and has an annual fee of 0.70%. Stocks and ETF trades have commissions of 1% of your principal, with a minimum commission of $25 and zero trading fees.
Top Brokerage Houses, Ranked
Based on this information, the largest brokerages in the U.S. are as follows:
| Top Brokerage Firms by AUM and Number of Accounts | |||
|---|---|---|---|
| Rank | Firm | AUM | Customer Accounts |
| 1 | Charles Schwab | $8.85 Trillion | 35 million |
| 2 | Vanguard | $8.2 Trillion | 50+ million |
| 3 | Fidelity Investments | $5.3 Trillion | 50+ million |
| 4 | JP Morgan | $3.6 Trillion | 80 million |
What Is a Brokerage Firm?
A brokerage account is used to buy and sell stocks, bonds, shares of mutual funds or index funds, and other securities.
What Are the Big 4 Brokerage Firms?
The biggest firms in the U.S. are Charles Schwab, Fidelity, Vanguard, and JPMorgan. These companies provide brokerage services to millions of clients.
What's the Difference Between Broker and Brokerage Firm?
A broker is an individual who connects buyers and sellers to facilitate transactions. A brokerage is a company that provides investing and other financial services.
The Bottom Line
While there are many brokerage houses in the U.S., the largest are Charles Schwab, Fidelity, JP Morgan, and Vanguard. These are huge asset managers with millions of customers investing trillions of dollars.
