E-Trade drops commissions on trades, joining Schwab, TD Ameritrade in brokerage fee war


Pedestrians walk outside an E*Trade Financial office in New York.

Daniel Acker | Bloomberg | Getty Images

Retail brokerage firm E-Trade announced Wednesday it will drop commission fees on online U.S. stock, ETF and options trades.

The move comes within a week of Interactive Brokers, Charles Schwab and TD Ameritrade all dropping their commission fees. Shares of all the brokerage firms have been getting hit this week on fears that a lack of commission revenue with hurt margins.

E-Trade’s new fee structure will start on October 7. Options will still have a 65 cents charge per contract.

“”With this new commission schedule we are further raising the bar, delivering an unrivaled experience at price points that cannot be beat,” said E-Trade chief executive officer Mike Pizzi in a press release.

E-Trade estimates a quarterly revenue impact of $75 million from dropping fees.

Bank of America estimates E-Trade gets about 17% of revenue from commission. TD Ameritrade generates 28% of revenue from commissions and Schwab generates only 8% from revenue.

Articles You May Like

Wall Street layoffs likely ahead as two-year hiring boom turns to bust
$6.5 Million Mountain Retreat Is Rare Inventory For Booming South Lake Tahoe Town
Watch Fed Chair Powell talk live about the economy, interest rates at ECB forum
Worried about an economic downturn? Here’s what you can expect in a typical recession, according to economists
Fight for Spirit Airlines goes down to the wire with competing bids from Frontier and JetBlue

Leave a Reply

Your email address will not be published.