✅ Best in Category

Fidelity leads the retail brokerage industry in consumer-friendly practices. Unlike competitors, Fidelity routes retail orders to exchanges for better price execution rather than maximizing PFOF revenue. The company maintained trading access during the 2021 volatility events when others restricted buying.

Score Breakdown by Category

How Fidelity's terms rate across my evaluation categories.

💰 Order Execution & Transparency (30%) 55/100

Why this score: Fidelity does not engage in payment for order flow for equity orders, instead routing to exchanges for price improvement. Studies show Fidelity provides better execution quality than PFOF-dependent brokers. Options orders may still involve PFOF.

Industry comparison: E*Trade: 48/100 (standard PFOF) | Robinhood: 28/100 (aggressive PFOF) | Webull: 30/100 (aggressive PFOF) | Category avg: 40/100

⚖ Trading Freedom & Restrictions (25%) 62/100

Why this score: Fidelity did not restrict GameStop buying during the 2021 volatility. Standard pattern day trading rules apply per regulatory requirements, but Fidelity maintains broader access to trading than competitors during volatile periods.

Industry comparison: E*Trade: 55/100 (some restrictions) | Robinhood: 22/100 (GameStop restrictions) | Webull: 40/100 (similar to Robinhood) | Category avg: 45/100

🔒 Margin & Liquidation Rights (20%) 58/100

Why this score: Fidelity provides clearer margin communication than competitors with more notice before liquidation in typical scenarios. The platform retains standard rights to liquidate during extreme market conditions but exercises this less aggressively.

Industry comparison: E*Trade: 52/100 (moderate margin terms) | Robinhood: 35/100 (aggressive liquidation) | Webull: 38/100 (limited notice) | Category avg: 46/100

👁 Account Security & Data (15%) 65/100

Why this score: As a privately held company, Fidelity has fewer conflicts of interest than publicly traded competitors. Strong SIPC protection plus excess coverage. Data practices are more conservative with less aggressive marketing use.

Industry comparison: E*Trade: 55/100 (Morgan Stanley sharing) | Robinhood: 45/100 (extensive data collection) | Webull: 32/100 (Chinese ownership) | Category avg: 49/100

👥 Dispute Resolution (10%) 52/100

Why this score: Mandatory FINRA arbitration still applies - this is industry standard and unlikely to change. Customer service for disputes is excellent with phone access and knowledgeable representatives. Class action waiver is standard.

Industry comparison: E*Trade: 50/100 (same arbitration) | Robinhood: 48/100 (poor support) | Webull: 42/100 (limited support) | Category avg: 48/100

Compare With Other Platforms

⚠ Key Clauses to Watch

Even the best broker has provisions that warrant attention.

Mandatory FINRA Arbitration

High Risk

Like all FINRA member brokers, Fidelity requires disputes to go through FINRA arbitration. This limits your access to courts and jury trials for investment-related disputes.

"Any controversy or claim arising out of your accounts shall be settled by arbitration in accordance with FINRA rules." Fidelity Customer Agreement

Securities Lending in Some Accounts

Medium Risk

Fidelity's fully paid lending program allows your shares to be loaned to short sellers. Participation requires consent, but margin account securities may be lent automatically.

"Securities in margin accounts may be loaned. Fully paid lending requires separate enrollment and consent." Fidelity Margin Agreement

Margin Call Liquidation Rights

Medium Risk

While Fidelity provides more notice than competitors, they retain the right to liquidate positions during margin calls without waiting for customer response in extreme situations.

"We may sell securities in your account to meet a margin call without prior notice to you." Fidelity Margin Agreement

Account Restriction Rights

Medium Risk

Fidelity retains standard rights to restrict or close accounts. While exercised less frequently than app-based competitors, the authority exists in the terms.

"We may restrict trading or close accounts for regulatory compliance or other reasons." Fidelity Customer Agreement

Options Order PFOF

Medium Risk

While equity orders are routed for price improvement, options orders may still involve payment for order flow arrangements with market makers.

"For options orders, we may receive payment from market makers for order flow." Fidelity Order Routing Disclosure

Trading Halts During Extreme Volatility

Medium Risk

Fidelity performed well during 2021 volatility, but terms still allow trading restrictions during extreme market conditions if necessary.

"We reserve the right to decline orders or restrict trading during periods of extreme market volatility." Fidelity Customer Agreement

Analysis

"Fidelity is my recommendation for serious retail investors. As a privately held company, they have fewer conflicts of interest than publicly traded competitors who must maximize shareholder returns at your expense.

The decision not to maximize PFOF revenue at the expense of execution quality is significant. Independent studies consistently show Fidelity provides better price improvement than competitors. This matters more than many realize - poor execution can cost you more than commission fees ever did.

However, Fidelity isn't perfect. Mandatory FINRA arbitration still applies, which is an industry-wide problem. Securities lending in margin accounts is automatic. But compared to alternatives, Fidelity offers the best combination of fair terms and quality execution. If you're serious about investing, this should be your primary brokerage."

Fidelity Terms of Service Review

✅ Best in Category

Score Breakdown by Category

Compare With Other Platforms

⚠ Fidelity Account Issues?

⚠ Key Clauses to Watch

Mandatory FINRA Arbitration

Securities Lending in Some Accounts

Margin Call Liquidation Rights

Account Restriction Rights

Options Order PFOF

Trading Halts During Extreme Volatility

Analysis

Need Help With Fidelity?

Schedule a Consultation

Fidelity Terms of Service Review

✅ Best in Category

Score Breakdown by Category

Compare With Other Platforms

⚠ Fidelity Account Issues?

Related Resources

⚠ Key Clauses to Watch

Mandatory FINRA Arbitration

Securities Lending in Some Accounts

Margin Call Liquidation Rights

Account Restriction Rights

Options Order PFOF

Trading Halts During Extreme Volatility

Analysis

Need Help With Fidelity?

Schedule a Consultation