NerdWallet’s comprehensive review process assesses and ranks America’s largest brokers and robo-advisers by assets under management, as well as emerging industry players, using a multi-dimensional and iterative approach. Our goal is to provide an independent assessment of providers to help provide you with information so that you can make sound and informed judgments about which ones will best meet your needs.
DATA COLLECTION AND REVIEW PROCESS
We collect data directly from vendors and perform first-hand testing and observation through vendor demos. Our process begins with sending detailed questionnaires to suppliers to complete. The questionnaires are structured to elicit both positive and negative responses from providers. They are not designed or prepared to produce predetermined results. Questionnaire responses, combined with product demonstrations, interviews with supplier staff, and hands-on research from our specialists, feed into our proprietary assessment process that scores each supplier’s performance on more than 20 factors. The end result produces ratings ranging from poor (one star) to excellent (five stars). Ratings are rounded to the nearest half star.
Ratings vary by type of provider, but in each case they are based on weighted averages of factors that include, but are not limited to: advisory and account fees, minimums and account types, selection of investments, investment expense ratios, trading costs, access to human financial resources. advisors, educational resources and tools, rebalancing and tax reduction options and customer support, including branch access, user technology and mobile platforms.
Each factor may involve the assessment of various sub-factors. For example, when evaluating the investment selections offered by robo-advisers, 80% of the score is based on the diversification potential (how diversified a resulting investment portfolio might be) combined with the availability of specialized portfolios and at the level of personalization for investors. Expense ratios make up an additional 10% of the score, and low or no management fees the remaining 10%.
The weighting of each factor is based on our team’s assessment of which features are most important to consumers and which have the most significant impact on the consumer experience. The factors taken into account and the way in which these factors are weighted vary according to the category of providers examined.
Supplier categories include: Best Brokers for Stock Trading, Best Brokers for Newbies, Best Brokers for Day Trading, Best Brokers for Options Trading, Best Discount Brokers, Best Brokers for free trading, the best investment apps, the best brokers for Penny Stocks, the best IRA brokers, the best robo-advisers, the best financial advisers, the best real estate platforms, the best brokers for ETFs and the best brokers for mutual funds.
Editors and Editors conduct reviews of our brokers and bot advisers every year, but update throughout the year. We maintain frequent contact with service providers and highlight any change in the offer.
The review team includes seasoned writers, researchers and editors who cover stocks, bonds, mutual funds, index funds, exchange traded funds, alternative investments, socially responsible investing, financial advisers, retirement and investment strategy. In addition to NerdWallet, the work of our team members has been featured in The New York Times, Washington Post, Forbes, USA Today, Bloomberg News, Nasdaq, MSN, MarketWatch, Yahoo! Finance and other national and regional media.
The combined expertise of our investment team is incorporated into our review process to ensure thoughtful evaluations of vendor products and services from a client perspective. Our writers and editors combine to have more than 70 years of in-depth experience in finance, ranging from a former Wall Street Journal reporter to a former senior financial advisor at Merrill Lynch.
Although NerdWallet has partnerships with many valued vendors, we manage potential conflicts of interest by maintaining a wall between our content and our business operations. This wall is designed to prevent our editors and the review process from being influenced or impacted by our business partnerships. In this way, all reviews can provide an unbiased review that serves the interests of our users. For more information, see NerdWallet’s editorial guidelines.