Fidelity vs AJ Bell: what's the difference?

When it comes to choosing a platform for managing your investments, Fidelity and AJ Bell both stand out as highly respected providers in the UK.

Each offers a variety of services aimed at different investor profiles.

This guide examines the key distinctions between the two to help you decide which platform to choose.

What is the difference between Fidelity and AJ Bell? 

Fidelity and AJ Bell are two of the UK's leading investment platforms, but they cater to slightly different audiences and needs. 

Fidelity International is a global investment management giant known for providing comprehensive investment services, including investment funds, ISAs, pensions, and general investment accounts.

Fidelity is particularly popular among investors seeking an easy-to-use platform coupled with extensive research and guidance. 

AJ Bell is a UK-based investment platform that offers a wide range of account types including Stocks and Shares ISAs, SIPPs (Self Invested Personal Pensions), and general investment accounts.

AJ Bell tends to appeal to investors who prefer a straightforward platform, competitive pricing, and a wide variety of investment choices, from shares and funds to ETFs and investment trusts. 

Fidelity and AJ Bell: how do the fees compare? 

Fees can significantly impact your returns over the long term, making it crucial to understand the cost structures of these platforms: 

Fidelity fees 

• Annual platform fee: Typically 0.35% for investments up to £250,000; 0.20% for investments between £250,000 and £1 million; no charge for investments over £1 million.

• Trading fees: No charge for fund dealing; £7.50 to £30.00 for shares, ETFs, and investment trusts depending on frequency type of trade.

AJ Bell fees 

• Annual platform fee: 0.25% for the first £250,000 invested, then reduces gradually; no charge for holdings over £2 million. 

• Trading fees: £1.50 per fund trade, £5.00 for shares reducing to £3.50 for frequent dealers

Overall, AJ Bell tends to have slightly lower platform fees for smaller portfolios, while Fidelity can become cheaper for larger portfolios due to its fee structure. 

Is Fidelity or AJ Bell better? 

To decide which is better for your specific needs, it’s useful to consider these key aspects: 

Range of investments 

Fidelity offers access to a wide range of funds, including actively managed and passive funds, plus shares, ETFs, and investment trusts. 

AJ Bell has a particularly strong offering in terms of variety, including shares, funds, ETFs, investment trusts, bonds, and even structured products. 

AJ Bell edges ahead slightly if diversity and flexibility in investment choices are your priority. 

Research and guidance 

Fidelity has strong research resources, extensive market analysis, and regular insights from Fidelity's experienced investment team. 

AJ Bell provides good-quality research and investor resources, but is generally more streamlined and less extensive compared to Fidelity. 

If robust research tools and comprehensive insights are crucial for your investing style, Fidelity might be the better choice. 

Brand reputation 

Fidelity is a global brand with a long-standing reputation for reliability and customer service, known particularly for its strong commitment to investor education. 

AJ Bell is well-established in the UK with a solid reputation for transparency, low-cost investing, and user-friendly service. 

Both companies have strong reputations, but Fidelity's global presence and depth of experience often instil greater confidence among investors. 

Can you open accounts with both Fidelity and AJ Bell? 

Yes, investors can have accounts with both Fidelity and AJ Bell.

Doing so can provide flexibility, allowing you to benefit from the strengths of each platform.

For example, you might choose Fidelity for detailed investment research and guidance while using AJ Bell for specific asset classes or lower trading fees. 

Which is better for passive, long-term investing? 

For investors looking specifically at passive, long-term strategies, both Fidelity and AJ Bell offer strong propositions.

However, the lower fees at AJ Bell, especially on fund trading and its overall competitive annual charges for smaller portfolios, can make it more attractive for long-term, passive investors. 

Fidelity is also a good choice, particularly for those with larger portfolios who might benefit from its zero platform fees for holdings above £1 million and the broad selection of low-cost index funds. 

How do their investment philosophies differ? 

Fidelity and AJ Bell differ subtly in their approach to investing.

Fidelity leverages extensive research and focuses heavily on guiding investors through detailed market insights, often appealing to investors who prefer actively managed solutions. 

AJ Bell has a greater emphasis simplicity, cost-efficiency, and accessibility, catering primarily to investors comfortable making their own decisions or choosing simple, straightforward portfolios. 

Investors who prefer detailed research and potentially active management might lean toward Fidelity, whereas those prioritising simplicity, lower costs, and a DIY approach will likely prefer AJ Bell. 

Get expert financial advice 

Choosing between Fidelity and AJ Bell depends on your individual investment goals, portfolio size, investment style, and the level of support you prefer.

Both platforms offer excellent services and each excel in different areas.

Speaking with a financial adviser can significantly enhance your decision-making, ensuring your choice aligns perfectly with your financial strategy and long-term investment objectives.

Expert financial advice can provide clarity, confidence, and tailored recommendations specific to your personal circumstances.