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

Baylor University outperformed the Ivy League in university endowment performance rankings. Here’s how
Best Buy warns of layoffs as it issues soft full-year guidance
AB InBev profits rise despite ongoing hit from Bud Light boycott in U.S.
Maserati reveals first GranCabrio convertible sports car since 2019
Geely-backed car tech company takes aim at Nvidia’s growing auto business

Leave a Reply

Your email address will not be published. Required fields are marked *