When it comes to choosing a financial advisor or wealth management firm to handle your investments, two big names often come up – Fisher Investments and Edward Jones. Both companies have been around for decades and manage billions in assets.
But they have some key differences that may make one a better fit than the other depending on your needs. This comprehensive guide examines Fisher Investments Vs. Edward Jones to help you decide which is better for your investment portfolio.
A Brief Comparison Table
| Category | Fisher Investments | Edward Jones |
| Services Offered | Portfolio management of stocks, bonds, ETFs | Stocks, bonds, mutual funds, annuities, insurance, banking |
| Fee Structure | Asset-based fee, 1.5% of AUM per year | Commissions-based pricing, undisclosed rates |
| Account Minimum | $250,000 | $5,000 |
| Investment Approach | Active, top-down, trading-focused | Mixed passive and active, bottom-up |
| Portfolio Managers | Firm strategists | Local advisors |
| Transparency | High, fee-only pricing | Lower, commissions not disclosed |
| Client Experience | Team-based, technology-enabled | Local advisor relationships |
| Performance History | Consistent outperformance over benchmarks | Mixed track record depending on products |
| Reputation | Lesser-known, controversial active manager | Well-known trusted neighborhood broker |
Overview Of Fisher Investments
Fisher Investments is a fee-only investment adviser firm founded in 1979 by Ken Fisher. The firm manages over $197 billion in assets for high net worth individuals as well as large institutional clients. Fisher Investments takes a top-down approach to investing, developing global strategies rather than focusing on individual stocks.
Some key details about Fisher Investments:
- Manages money for over 65,000 clients globally
- Requires $250,000 minimum to open an account
- Charges a yearly 1.5% fee on assets under management
- Offers a variety of actively managed equity and fixed income strategies
- Known for high rate of portfolio turnover compared to competitors
- Based in Camas, Washington with four regional offices in US and Europe
Overview Of Edward Jones
Edward Jones is a full-service brokerage firm founded in 1922 by Edward D. Jones. It focuses on individual investors and has over 7 million clients invested in stocks, bonds, mutual funds, and annuities. Edward Jones advisors work on a franchise model to offer localized services.
Here are some key details on Edward Jones:
- Works with over 7 million investor accounts globally
- Over 18,000 offices located in communities across the US and Canada
- Advisors are independent contractors, not employees of the firm
- Offers proprietary mutual funds and annuities in addition to other products
- Commissions-based compensation, not fee-only
- Based in St. Louis, Missouri with branch offices across North America
Comparison Between Fisher Investments And Edward Jones
Investment Products And Services
One of the biggest differences between Fisher Investments and Edward Jones lies in the types of investment products and services they offer clients.
Fisher Investments focuses exclusively on managing portfolios of stocks, bonds, and other securities based on their proprietary investing strategies. They do not sell any financial products. Instead, Fisher Investments’ sole revenue comes from the asset management fee charged to clients.
Edward Jones offers a wider array of investment and wealth management products including stocks, bonds, mutual funds, annuities, 529 college savings plans, insurance policies, mortgages, and banking products through their affiliates. Most Edward Jones clients hold a mixture of mutual funds, annuities, and individual securities.
The type of products each company offers can significantly impact your investment returns and costs. Actively managed portfolios from Fisher Investments aim to outperform the market after fees while products from Edward Jones, like annuities, involve costs that reduce returns.
Also Read: Comparison Between LPL Financial And Edward Jones.
Fee Structure And Minimums
The fee structure and account minimums required at Fisher Investments and Edward Jones also differ considerably.
Fisher Investments works on an asset-based fee model, charging 1.5% of assets under management per year. This fee is on the high end for the investment management industry. They require a $250,000 minimum to open an account.
Edward Jones mainly generates revenue through commissions on products sold to clients. While they do not disclose their commission rates publicly, representatives can charge up to 3% upfront on annuities and 6% on mutual funds. Edward Jones requires just a $5,000 minimum investment to open a brokerage account.
The fee-based structure of Fisher Investments may cost more overall but is more transparent compared to the commissions charged at Edward Jones. Fisher’s higher minimum investable assets makes them suited for high net worth individuals, while Edward Jones targets Main Street investors.
Investment Approach
Fisher Investments and Edward Jones also differ significantly in their approach to investing and portfolio management.
Fisher Investments employs a top-down investment strategy focused on asset allocation. Using their global macroeconomic analysis, Fisher strategists construct model portfolios across stocks, bonds, currencies, and commodities. Individual securities are then selected based on these allocation targets. Fisher Investments’ portfolio managers are very active, trading in and out of positions frequently.
In contrast, Edward Jones relies on a more localized, bottom-up approach driven by its advisors. Representatives provide personalized recommendations on securities and products to meet the needs of each client. Edward Jones portfolios tend to have relatively low turnover compared to averages. Their research analysts do provide guidance on allocations, but reps can select investments based on their preferences.
Fisher Investments’ hyper-active trading strategy aims to take advantage of short-term trends while Edward Jones focuses on building long-term client relationships through more customized recommendations. Which approach works better comes down to personal preferences on portfolio management.
Also watch this about Edward Jones!
Transparency
Transparency is another key point of differentiation. Fisher Investments provides full transparency on fees but Edward Jones is less transparent on things like commissions and proprietary product costs.
As a fee-only advisor, Fisher Investments discloses exactly what clients pay with no hidden costs. Their yearly 1.5% asset management fee is clearly explained upfront. You can also find Fisher Investments’ ADV disclosure with detailed info on their services and practices on their website and the SEC website.
With Edward Jones, it can be more difficult to determine what you are paying in total fees and costs. Commissions charged on products are not readily disclosed. There is also limited information available on costs associated with Edward Jones’ own proprietary funds and annuities. You need to request specific details on fees from a representative. Their website provides only general information on their pricing structure.
If keeping close track of investment costs is important to you, the transparency of Fisher Investments may provide more peace of mind compared to Edward Jones’ opaque fee structure.
Customer Service
The client service models at these two firms also provide some sharp contrasts.
Fisher Investments operates with a team-based approach focused on efficiency and technology. Clients do not work with a dedicated advisor. Their large client service teams have tiered levels of representatives you can contact by phone or email. Fisher also provides many self-service tools and resources through their website and mobile apps.
Edward Jones promotes a very personalized, face-to-face service model. Each client works with a dedicated financial advisor representative that serves their local community from a regional branch office. Meetings typically take place in person at the local office. Support is provided by the home office and online, but the client experience is very localized.
If having a personal advisor you meet with regularly is a priority, Edward Jones’ approach may resonate more. But Fisher Investments may appeal to those who prefer digital tools and more efficiency.
Performance And Reputation
When it comes to investment performance and reputation, Fisher Investments and Edward Jones have distinctly different track records.
Fisher Investments has built a reputation for consistently outperforming market benchmarks over the long run across their strategies. For example, their flagship Private Client Group portfolio has outperformed the S&P 500 benchmark for 23 out of the past 25 years. However, Fisher’s unconventional, active trading approach has drawn criticism from some experts.
Edward Jones does not have such a strong performance record based on their mixed portfolio of securities and products. Their proprietary mutual funds and annuities in particular have mediocre returns compared to category averages. But they have built a reputation as a trusted neighborhood brokerage thanks to their massive branch network and emphasis on relationships.
So, Fisher Investments seems to have an edge regarding actual investment results while Edward Jones leads in traditional reputation. But both clearly have established their own brand identities over the decades.
Also Read: Comparison Between Edward Jones And Northwestern Mutual.
Frequently Asked Questions (FAQ)
There is no definitive “better” choice between Fisher Investments and Edward Jones. Fisher likely has an edge for those wanting transparent, active portfolio management focused strictly on investment performance. Edward Jones may be preferable for investors who prioritize a close-knit, personalized advisor relationship and want a wider array of brokerage products and services.
Fisher Investments provides active money management with a robust long-term track record of matching or surpassing benchmark returns across market cycles. Their strategies appeal to higher net worth investors who want strong performance and don’t require a personal advisor relationship. However, their 1.5% yearly fee is higher than many competitors.
Some of Edward Jones’ biggest competitors include:
Schwab – A full-service brokerage offering greater fee transparency and lower costs than Edward Jones for most buy and hold investors.
Fidelity – Similar to Schwab, Fidelity offers a wide range of investment products with lower overall costs compared to Edward Jones.
Independent RIAs – Fee-based independent RIAs often provide similar services to Edward Jones for lower overall costs due to avoiding commissions.
Vanguard – For passive index investors, Vanguard offers many of the same mutual funds with far lower expense ratios.
Fisher Investments does not disclose exact performance data but reports that their flagship Private Client Group (PCG) portfolio has outperformed the S&P 500 benchmark in 23 of the last 25 years, a track record far exceeding industry averages. Overall, PCG clients have likely averaged total returns in the high single digits to low double digits over the long run.
Also Read: Comparison Between Edward Jones And Morgan Stanley.
The Verdict
So, when weighing Fisher Investments Vs. Edward Jones, which financial services firm is the better choice overall? Here are a few key factors to consider:
If you want truly customized portfolio guidance from a local advisor, Edward Jones is likely the better fit. Their hyper-localized service model built on neighborhood branches sets them apart. But the costs may ultimately be higher due to opaque commissions.
If you have at least $250,000 to invest and want proven performance from active portfolio management, Fisher Investments may be the superior option. Their fee transparency and consistent benchmark-beating results appeal to higher net worth investors who want oversight of costs.
If having access to a wide range of brokerage products like annuities beyond just portfolio management is important, Edward Jones has the edge. The breadth of their offerings can provide clients with more options under one roof.
If you are highly price-sensitive and want to minimize fees, neither may be the best choice given Fisher’s higher asset-based fees and Edward Jones’ opaque commissions. A fee-based registered investment advisor (RIA) could provide full services for a lower overall cost in many cases.
In the end, choosing between Fisher Investments and Edward Jones depends heavily on your investment needs, budget, and personal preferences on advisor relationships and services. Analyzing their differences in depth is key to determining if one of these industry giants is the right fit to help you pursue your financial goals.