Fisher investments and Merrill Lynch are two major investment management firms in the US. Both aim to help clients grow their assets through investment advisory and portfolio management services. However, there are some key differences between the two firms in terms of investment philosophy, strategies, fees and reputation. Understanding their differences can help investors pick the right firm for their needs.
Fisher Investments focuses on top-down investing while Merrill Lynch uses a bottom-up approach
Fisher Investments employs a top-down approach in constructing client portfolios. It first develops a macroeconomic outlook and identifies attractive geographic regions and asset classes. It then selects individual securities that can benefit from the broader trends. In contrast, Merrill Lynch uses a bottom-up approach that focuses on analyzing fundamentals of individual stocks and bonds to pick undervalued securities.
Fisher Investments charges lower fees compared to Merrill Lynch
Fisher Investments is known for its low advisory fees compared to competitors. It charges a fee of 1.5% on total assets under management for most clients. Merrill Lynch’s fees are personalized for each client based on investment style and account size but typically range from 1% to over 2%. For larger portfolios over $10 million, Merrill Lynch’s fees can exceed Fisher’s fees significantly.
Fisher Investments has faced criticism while Merrill Lynch has a stronger reputation
Fisher Investments has come under criticism for its hard-sell tactics, high turnover ratios, and lack of transparency. It has been involved in multiple lawsuits over the years. In contrast, Merrill Lynch has over 100 years of operating history and is part of Bank of America, a reputed financial institution. It has demonstrated stability even during economic crises. However, it has also paid fines for practices like mis-selling mortgage-backed securities before the 2008 financial crisis.
Fisher Investments offers more customized portfolios while Merrill Lynch has a wider range of products
For portfolio management, Fisher Investments offers specific strategies based on client goals and risk appetite. Each client has a personally tailored portfolio. Merrill Lynch also provides customized portfolio management but has access to Bank of America’s wide array of banking and investment products. It offers research, retirement accounts, banking services, mortgages, etc along with investment advisory.
Fisher Investments manages more assets while Merrill Lynch has more financial advisors
As of 2022, Fisher Investments managed over $197 billion in assets for thousands of private clients and institutions globally. Merrill Lynch Wealth Management had around $2.4 trillion in client assets and over 14,000 financial advisors in the US. So while Fisher Investments manages more money overall, Merrill Lynch has greater reach through its large adviser network spread throughout the country.
In summary, Fisher Investments and Merrill Lynch have significantly different approaches to portfolio management and investment advice. Fisher Investments is a pure-play investment manager using a top-down strategy and charging lower fees. Merrill Lynch offers more customized and holistic financial services to clients but charges higher fees. Understanding these key differences can help investors pick the right fit for their investment style and financial needs.