When it comes to choosing an investment firm to manage your portfolio, two of the biggest names in the industry are Edward Jones and Morgan Stanley. Both companies have been around for decades and have established solid reputations for providing financial services to individual investors.
However, there are some key differences between these firms that are worth considering when deciding which one may be a better fit for your needs. In this comprehensive guide, we will compare and contrast Edward Jones and Morgan Stanley in terms of their account offerings, advisory services, fees, customer support and more.
A Brief Comparison Table
| Category | Edward Jones | Morgan Stanley |
| Account Offerings | Brokerage accounts, IRAs, simple investment products like stocks, bonds, mutual funds | Full brokerage accounts, managed accounts, alternative investments like hedge funds |
| Advisory Services | Client-directed brokerage, advisors provide guidance but clients make decisions | Offers brokerage and discretionary portfolio management, including robo-advisor |
| Fees | No account minimums, commissions for trading (~$30-$100 per trade), low expense ratios (~0.5-1%) | Account minimums from $5K to $100K+, asset-based wrap fees (1-2% annually) |
| Customer Service | Local offices for face-to-face service, dedicated advisor provides personalized guidance | Good service from 15K+ advisors globally, mix of in-person and digital experience |
| Clients | Individual investors, smaller accounts | High-net-worth investors, institutions, large accounts |
| Philosophy | Long-term, buy-and-hold | More trading, active management and alternatives |
Overview Of Edward Jones
Edward Jones is a full-service brokerage firm that primarily caters to individual investors. With over 19,000 financial advisors in branch office locations across the United States and Canada, Edward Jones takes a localized approach to serving clients. The company has built its reputation on providing personalized face-to-face service and advice to help clients achieve their long-term financial goals.
Here are some key facts about Edward Jones:
- Founded in 1922 in St. Louis, MO
- Over 7 million client accounts
- Ranked #1 in J.D. Power customer satisfaction among full-service investment firms
- Network of over 19,000 financial advisors
- Advisors are located in local branch offices in communities
- Offers brokerage accounts, IRAs, annuities, life insurance
- Focuses on long-term, buy-and-hold investing philosophy
Overview Of Morgan Stanley
In contrast to Edward Jones, Morgan Stanley focuses on serving high-net-worth individuals, businesses and institutions. With over 15,000 financial advisors globally, Morgan Stanley offers a full suite of investment products and services.
Here are some key facts about Morgan Stanley:
- Founded in 1935 and headquartered in New York
- Over 3.5 million client accounts
- Has major operations in over 40 countries
- Offers brokerage accounts, managed accounts, retirement planning, etc.
- Also provides investment banking, mergers & acquisitions advice
- Manages over $1 trillion in client assets
- Caters to ultra-high-net-worth and institutional investors
- More trading-oriented investment philosophy
Now that we’ve provided a brief overview of each company, let’s compare them across some key categories:
Account Offerings
Edward Jones
- Brokerage accounts (taxable, joint, custodial, estate)
- Traditional and Roth IRAs
- SIMPLE IRAs for small businesses
- SEP IRAs for self-employed individuals -529 college savings plans
- Annuities (fixed, variable, index)
- Life insurance
- Long-term care insurance
- Mutual funds
- Bonds (corporate, municipal, treasury)
- Publicly traded stocks and ETFs
- CDs
Morgan Stanley
- Brokerage accounts
- Managed accounts (with discretionary management by advisor)
- Retirement accounts like IRA, Roth IRA, SEP IRA
- Annuities
- Mutual funds
- ETFs
- Individual stocks and bonds
- Alternative investments (hedge funds, managed futures, private equity)
- Structured products
- Institutional services (outsourced CIO, equity trading, mergers & acquisitions)
Key Takeaways
- Both brokers offer standard brokerage accounts and retirement accounts like IRAs.
- Morgan Stanley offers more portfolio management services and alternative investment options for high net worth investors.
- Edward Jones has a simpler product shelf focused on long-term buy-and-hold investors.
Also Read: Comparison Between Fisher Investments And Edward Jones.
Advisory Services
Edward Jones
- Primarily provides client-directed brokerage services.
- Advisors provide advice, but clients make the final decisions.
- Advisors are primarily located in local branch offices.
- Does not offer discretionary investment management.
- Advisors help construct portfolios aligned to client’s risk tolerance and goals.
- Ongoing monitoring of accounts and annual reviews with advisors.
Morgan Stanley
- Offers brokerage services and discretionary investment management.
- Advisors can actively manage portfolios (called Morgan Stanley Wealth Management)
- Also offers self-directed brokerage accounts.
- Has robo-advisor called Access Investing with automated management.
- Dedicated portfolio management team for ultra-high-net-worth clients.
- Offers comprehensive financial planning services.
Key Takeaways
- Morgan Stanley has more portfolio management options including robo-advisors.
- Edward Jones focuses on giving advisors tools to construct optimal portfolios.
- Morgan Stanley caters to do-it-yourself investors and high-net-worth clients.
Fees And Costs
Edward Jones
- No account minimums.
- Commission-based pricing model for brokers.
- Typical commissions: $30-$50 for stocks, $30-$100 for bonds, $0-$75 for mutual funds.
- Additional fees for certain managed money accounts.
- Typical expense ratio on mutual funds around 0.5% to 1%.
Morgan Stanley
- Account minimums from $5K for brokerage to $100K+ for managed accounts.
- Primarily charges asset-based wrap fees on managed accounts.
- Total annual fee around 1-2% including advisor and management fees.
- Brokerage accounts have $0 equity and ETF trades (per trade fees for other securities).
- Mutual fund expense ratios may be higher, around 0.75% to 1.25%+.
Key Takeaways
- Morgan Stanley managed accounts have higher minimums and costs.
- Edward Jones has lower minimums but transactional commissions.
- Morgan Stanley offers deeper discounts on trading costs for larger accounts.
Customer Service
Edward Jones
- Local office model facilitates in-person service.
- Ranked #1 in J.D. Power satisfaction surveys.
- 24/7 phone support also available.
- Dedicated advisor provides personalized guidance.
- They get to know you and your full financial picture.
Morgan Stanley
- In-person service available from 15K+ advisors globally.
- Digital platforms like Morgan Stanley Access provide convenience.
- Ask by Morgan Stanley virtual assistant can answer common questions.
- Support service generally good but less intimate than Edward Jones model.
- Potential for less hand-holding for self-directed brokerage accounts.
Key Takeaways
- Hands-on, personalized service is a hallmark of Edward Jones.
- Morgan Stanley offers very good service but strategy depends on account type.
- Digital tools enhance Morgan Stanley’s customer experience.
Also Read: Comparison Between Edward Jones And Northwestern Mutual.
Pros And Cons of Edward Jones And Morgan Stanley
Key Pros of Edward Jones
- Excellent local, face-to-face client service.
- Lower account minimums and costs overall.
- Simple selection of investment products.
- Good fit for long-term, buy-and-hold investors.
Potential Cons of Edward Jones
- Limited portfolio management options.
- Transactional fee structure can add up for active traders.
- Limited alternative investment selection.
Key Pros of Morgan Stanley
- Broader range of investment products including alternatives.
- Sophisticated portfolio management services.
- Strong digital platforms and fintech integration.
Potential Cons of Morgan Stanley
- Higher minimums and account costs.
- Potentially less personalized service for self-directed accounts.
- More complex fee structure.
Watch the video of Edward Jones!
Also Read: Comparison Between Lendmark Financial And OneMain Financial
Frequently Asked Questions (FAQ)
There is no definitive “better” – it depends on individual circumstances. Edward Jones is likely a better fit for long-term investors seeking a personal advisor. Morgan Stanley may be preferable for active traders or accredited investors needing portfolio management.
Edward Jones’ biggest competitors are wirehouse firms like Morgan Stanley, Merrill Lynch and UBS along with other national brokerages like Charles Schwab and Fidelity. However, Edward Jones’ network of local offices gives it a community presence many large brokers lack.
Edward Jones charges commissions on trading rather than an asset-based wrap fee. Their typical commission on stocks is $30-$50, while mutual funds range from $0-$75. There are no management fees on brokerage accounts. Managed accounts have additional advisory fees around 0.35% of assets.
Morgan Stanley fees are higher than Edward Jones on average, but competitive for similar actively managed accounts at full-service brokerages. Total fees for managed accounts often range from 1-2% annually including advisor and management fees. Their self-directed brokerage account trading costs are on par with discount brokers.
Also Read: Comparison Between LPL Financial And Edward Jones.
The Bottom Line
When choosing between Morgan Stanley and Edward Jones, there are a few key factors to keep in mind:
- Your desired account type – brokerage, managed, or both
- How active you want to be in managing your investments
- Your need for portfolio management services
- Interest in alternative investment products
- Preference for in-person service over digital experience
Both Morgan Stanley and Edward Jones are excellent firms for investors. Getting clarity on your specific needs and priorities will help determine which may be the better fit to achieve your investment goals.
The local presence and highly personalized service of Edward Jones makes it stand out from most national brokerages. Yet for larger accounts needing professional management, Morgan Stanley has a very robust suite of offerings.
