The Largest Brokerage Firms by Assets Under Management
Charles Schwab
In first place is Charles Schwab. This famous investment firm has approximately $8.7 trillion
in assets under management (AUM) at last count. This figure is in addition to more than $100 billion in
deposits with Schwab Bank. The company’s very large treasure trove is calculated across more than
34.8 million financial accounts and includes nearly
$1 billion in Schwab mutual and exchange-traded funds.
Besides the distinction of being the largest broker-dealer by AUM, Schwab also has some of the best
software in the business. It is the owner and operator of the very famous thinkorswim platform, which
advanced traders often use.
And for its clients who would rather let Schwab do all the heavy lifting, there are branch locations that
deliver investment-advisory services. Schwab has more than 300 of these centers, which manage to provide
customer service to brokerage clients as well.
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Vanguard
Up next is Vanguard. This well-known financial conglomerate is definitely one of the largest brokerage
firms by AUM. The company has $8.6 trillion in assets under
management. This enormous treasure chest is composed of more than 50 million clients using both active
and passive funds.
In addition to managing a large suite of mutual and exchange-traded funds, Vanguard also offers brokerage
accounts to help customers trade and invest well into the future. Digital trading tools, however, are on
the elementary side as Vanguard emphasizes buy-and-hold investing.
And unlike Schwab, Vanguard has no branch locations. It does, nevertheless, manage to deliver
investment-advisory accounts through online channels.
Fidelity Investments
Third in our survey of the largest brokerage firms by AUM is Fidelity. This investment firm manages roughly
$4.9 trillion in mutual funds, ETFs, and discretionary advisory accounts.
It also has non-discretionary accounts, cash-management programs, and brokerage accounts that bring the
company’s assets under administration to a staggering $12.6 trillion.
The company itself has even more impressive numbers. For example, it has 215 branch locations in the United
States and handful around the world. It employs more than 70,000 workers who assist more than
49 million customers. And it has partnered with more than 24,000 employers to create more than
43 million workplace retirement accounts.
Fidelity is truly one of the largest brokerage firms by AUM. But it also has an impressive suite of trading
tools, not least of which is Active Trader Pro, a sophisticated desktop program that is advanced enough for experienced traders and easy enough for beginners. The company’s website and mobile app have their own impressive collections of trading tools.
J.P. Morgan
Up next in our list of the largest broker-dealers by AUM is J.P. Morgan. The company operates multiple
investment firms, each with its own specialty. These divisions include J.P. Morgan Investing, J.P. Morgan
Personal Advisors, J.P. Morgan Private Client Advisor, and J.P. Morgan Asset Management.
The last unit manages a suite of funds that account for roughly $2.9 trillion. Adding in retail advisory assets, the
number increases to more than $4.0 trillion for the parent company J.P. Morgan. Adding in the company’s
investment banking business, there are trillions of more dollars. And Chase Bank adds in trillions more
in deposit accounts and credit-card transactions. Basically, this is a really, really big company.
At J.P. Morgan Investing, we found simple trading tools. They don’t quite measure up to Fidelity’s or
Schwab’s software, although they will be adequate for many forms of investing. The company’s large
network of financial planners through J.P. Morgan Private Client Advisor will be a better option for
traditional in-person service. There are hundreds of branch locations throughout the United States; some
of these are at Chase Bank centers.
Merrill
Last, but certainly not least, in our list of largest brokerage firms by assets under management is Bank
of America’s investing division. Most commonly known as Merrill Lynch, the investment firm has recently
been rebranded simply as Merrill. It operates the online discount firm Merrill Edge along with a large
suite of traditional full-service programs that are available at branch locations.
We count around $2.9 trillion in total client assets at Merrill,
including both advisory and brokerage accounts through both Edge and traditional channels. This definitely
makes Merrill one of the largest broker-dealers by AUM. Combined with deposits at Bank of America, the
treasure trove is around $5.0 trillion. It’s enough to produce billions of dollars in revenue every year.
What Exactly is AUM?
Assets Under Management can be defined in different ways. The most common definition is the total assets a firm manages, hence the term ‘Assets Under Management.’ To be considered managed, assets must be under the control of the investment firm. Thus, assets in mutual funds, ETFs, and discretionary advisory accounts are counted towards AUM. Assets in non-discretionary advisory accounts and in brokerage accounts aren’t usually a part of the calculation, although ETFs and mutual funds in brokerage accounts are managed assets. Thus, they will be part of someone’s AUM. For example, a Vanguard ETF at E*Trade is part of Vanguard’s AUM but not E*Trade’s.
Fidelity’s astounding $12.6 trillion figure is assets under administration. This number is calculated by adding AUM to a lot of other data points, including assets in brokerage and cash accounts that aren’t actively managed by any firm.
Is AUM Important?
The choice of a brokerage firm is a subjective decision that will naturally vary by a variety of factors. Day traders who need advanced software may prefer a smaller firm like Interactive Brokers who has much better trading tools than a large long-term firm like Vanguard. Long-term investors themselves may not get better insurance policies out of larger firms, although some of these will have excess SIPC insurance.
In all cases, size is only one part of the equation, and good and bad experiences will both be found at large and small firms alike. The really important goal is to know what you want out of an investment firm and use information here to choose the firm that best fits your investment and trading needs.
Alphabetical List of Online Brokers’ Total Assets Under Management (AUM)
Largest Brokerage Firms by Assets Disclaimer
The total amount of client assets held by a broker-dealer changes on a daily basis as market prices fluctuate and as customers deposit and withdraw funds. Please see a company's financial statements before choosing any investment firm.
Updated on 4/2/2024.
Chad Morris is a financial writer with more than 20 years experience
as both an English teacher and an avid trader. When he isn’t writing
expert content for Brokerage-Review.com, Chad can usually be found
managing his portfolio or building a new home computer.
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