Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

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UpperNwGuy
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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by UpperNwGuy » Tue Oct 01, 2019 2:49 pm

This is good news for investors!

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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by Doc » Tue Oct 01, 2019 3:14 pm

inbox788 wrote:
Tue Oct 01, 2019 10:32 am
I don't think their financial consultants are fiduciaries, so I wouldn't trust them to be looking out for me.

Any good reasons to visit these Schwab offices?
My "consultant" has these credentials:

Series 7, 9, 10, 66 Securities Licenses
Life & Variable Annuity Insurance License

I don't know what those licenses mean. But on our only one on one, she was well prepared with a detailed analyses of our portfolio and the only thing she suggested changing was an outdated beneficiary designation on one account.
A scientist looks for THE answer to a problem, an engineer looks for AN answer and lawyers ONLY have opinions. Investing is not a science.

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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by inbox788 » Tue Oct 01, 2019 3:20 pm

DonIce wrote:
Tue Oct 01, 2019 2:39 pm
The free options trading is unique I think? Are there other brokerages that have $0 options trading? Lots now offer ETFs and stocks commission free but I don't recall seeing free options.
Not all fees are going to zero; for options it's just the base fee. There is still a per contract cost. And they will keep passing on fees (and probably find more fees to pass on over time). Ooma "free" basic service has been great, but they keep increasing the taxes and fees, and they're one of the good ones as far as transparency. Airline tickets prices can now be as little as $100, but with added $500 in airport fees and taxes. It's silly to call it "free" or $9 if you're realistically going to be spending hundreds and have to resort to charging for seats and oxygen.

Anyway, for BH who don't trade, collecting fees in other ways may wind up costing more. Those heavy traders may have been subsidizing the sparse traders. Now all trading may be subsidized, since revenue is now zero but there are real costs, record keeping, compliance, and support that need to be paid for.
Doc wrote:
Tue Oct 01, 2019 2:48 pm
Hector wrote:
Tue Oct 01, 2019 12:41 pm
If other brokers don't match. Schwab would keep getting new money $ in. They make money from their sweep accounts fees (ER of Money Market Funds), by offering their inventory for secondary treasury trading, other commissions on fix income options, bid and spread difference in trading.
Schwab's Sweep account is Schwab Bank account not a MM fund. The sweep account pays 0.15% interest for balances less than $1,000,000. Over $1 million 0.55%.

The net ER on their "main" purchase money market account is currently 0.34% with waivers.

So they are making more money on "cash" investments than say a Vanguard.
The loss of revenue is supposedly only 3-4% out of the 6.8% trading revenue. So it looks like Net interest revenue and Asset management and admin fees will be sufficient to keep the doors open. Other discount brokerages may not fare so well. [Schwab and IB down 10%, E-trade down 15%, TD Ameritrade down 25%] https://www.marketwatch.com/story/etrad ... 2019-10-01

Image
https://www.financial-planning.com/news ... les-schwab

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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by WhiteMaxima » Tue Oct 01, 2019 3:26 pm

Which market at the peak. There are increase shorting interest on the market.

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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by LilyFleur » Tue Oct 01, 2019 3:31 pm

inbox788 wrote:
Tue Oct 01, 2019 10:32 am
student wrote:
Tue Oct 01, 2019 8:31 am
My concern is they may have to save money elsewhere and it may affect customer service.
That was my concern with Fidelity as well. Vanguard has virtually no offices, while Schwab and Fidelity keep a large number of offices and staff. I just looked and found 2 Schwab offices near me (with each having 3 vp/senior financial consultants -- salespeople?). I don't think their financial consultants are fiduciaries, so I wouldn't trust them to be looking out for me.

Any good reasons to visit these Schwab offices?
They are fiduciaries:
"Providing Advice as a Fiduciary and Meeting Impartial Conduct Standards. ... This means that we act as a fiduciary under ERISA and the Internal Revenue Code. The compensation Schwab and our representatives receive when you follow our investment advice recommendation will be reasonable."
https://www.schwab.com/public/schwab/nn ... ounts.html
I like my local Schwab office. If you need to open an account and want to do it there, they give you a laptop and talk you through it. Free coffee, soda, and water, too :happy And I can deposit a check at the front desk.
At Schwab, I do not pay a 1% fee for advice every month, but I have been happy with my advisor who helped me fill out paperwork to establish an inherited IRA, and he also helped my son open an account and gave him a great pep talk about rainy day savings and retirement savings (sometimes it is good for adult children to hear the advice from someone who is not their mom). He has run several monte carlo reports for me, which includes funds not held at Schwab (and I told him I would not be moving them to Schwab).
YMMV.
They did recently have a layoff so I hope their level of customer service remains high.

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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by DetroitRick » Tue Oct 01, 2019 4:14 pm

inbox788 wrote:
Tue Oct 01, 2019 10:32 am

Any good reasons to visit these Schwab offices?
I've found it helpful on occasion, but certainly not critical. Since their office just happened/happens to be 5 miles from home and 2 miles from office, even more so. The Schwab office functions that I've found most helpful over the years:
- Processing more complex paperwork such as inheritance-related transfers where having a human check of forms for completeness can be helpful
- Account deposits - but not anymore since the advent of online deposits. It used to be really handy for me.
- Seminars and workshops - I've attended several good ones there, such as trading platform software instruction.
- Referrals to other local experts (like specialized tax or estate planning).
- Gotten my local rep to fix administrative screw-ups on several occasions - not often, but his involvement made things quicker and easier. But that's by phone anyway and this need has been very rare for me.

With some reps, current rep included, I've had mildly helpful "state of the market" discussions at the office and by phone. And bounced one or two financial choices off them and got meaningful input. So I like the availability, but wouldn't leave Schwab if that office was no longer there. My rep has a decent financial background, as have all but one in my past history with Schwab.

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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by ResearchMed » Tue Oct 01, 2019 4:30 pm

David Althaus wrote:
Tue Oct 01, 2019 10:23 am
It's almost assured other brokers will soon follow. What will this eventually do to traditional mutual funds? Other than not being able to purchase fractional shares I can think of no reason we all shouldn't switch to the ETF version and save on the expense ratio.

All the best
Except for those of us with significant sums stuck in 403b type accounts, where ETF's are not allowed.
ONLY Mutual Funds, period.

Sigh.
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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by stlutz » Tue Oct 01, 2019 6:46 pm

I kind of find the timing on this to be surprising. Given that we are now in a declining rate cycle (and a lot of talk about zero and negative rates), it's an odd time for them to cut off other revenue streams. They really got hurt when rates were at zero for so long previously.

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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by Startled Cat » Tue Oct 01, 2019 7:13 pm

inbox788 wrote:
Tue Oct 01, 2019 3:20 pm
The loss of revenue is supposedly only 3-4% out of the 6.8% trading revenue. So it looks like Net interest revenue and Asset management and admin fees will be sufficient to keep the doors open. Other discount brokerages may not fare so well. [Schwab and IB down 10%, E-trade down 15%, TD Ameritrade down 25%] https://www.marketwatch.com/story/etrad ... 2019-10-01
The only thing that surprises me about this announcement is the equity market’s reaction. Did this really come as a total surprise? I’m only a casual observer, and I had no doubt commission-free trading would soon become the standard. In a world where Robinhood is growing rapidly, and traditional discount brokerages like Merrill Edge and WellsTrade already make trades free for those who meet a relatively modest AUM requirement, why would anyone believe that the business model wouldn’t have to change? If Schwab didn’t make this announcement today, another big player would have within the next year or two at most. TDAmeritrade moving 25% on the announcement is crazy. Makes me think that sometimes markets are very inefficient.

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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by cheesepep » Tue Oct 01, 2019 7:46 pm

BIG news. Detrimental to other brokerages such as TD, which gets 25% of their revenue from trading commissions. Chuck only gets 3-4% (per the horse's mouth, not 8% as per the CNBC estimates), so it is not that bad. And the influx of new customers coming into Schwab will be more than the 3-4% revenue lost.

Schwab said last time they reduced commission prices, their client assets went from 2.9 trillion to 3.72 trillion, and I expect something of the same here.

For me, as a relatively recent SCHW user and stockholder, I bought more SCHW and will be long. As a user, I was considering moving my SCHW holdings to Chase You Invest because of the $5 vs $3 trading commissions, respectively. Now, upon hearing this news, I may do the opposite, since it is now $0 vs $3. I do a lot of trading and all of these $3/5 commissions add up quickly, to the tune of several hundred dollars a year that can potentially be saved.

Plus, Chuck has great customer service instead of the robot, cold feeling service that I got from Chase You Invest recently.

Still a major Chase fan and stockholder though.

Will kill the only incentive for people going to RH (besides the bitcoin traders, of which there are few) and the new IB lite platforms. All offer free trading, but only Chuck offers great customer service instead of an email address and Schwab also offers a decent checking account (with decent interest) and decent mutual fund to deposit cash in for a bit.

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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by livesoft » Tue Oct 01, 2019 7:50 pm

Chase You Invest has no commissions on Vanguard mutual funds I think.

These no commissions things of this week do not include mutual funds (specifically Vanguard mutual funds), right? Or do they?
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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by guyinlaw » Tue Oct 01, 2019 7:57 pm

Does Charles Schwab block any ETFs like Merrill Edge and Chase do?

Merrill Edge blocks some vanguard ETF, WisdonTree NTSX, Avantis ETFs and other active ETFs. Does Charles Schwab do any such thing?
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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by cheesepep » Tue Oct 01, 2019 8:04 pm

guyinlaw wrote:
Tue Oct 01, 2019 7:57 pm
Does Charles Schwab block any ETFs like Merrill Edge and Chase do?

Merrill Edge blocks some vanguard ETF, WisdonTree NTSX, Avantis ETFs and other active ETFs. Does Charles Schwab do any such thing?
Just logged into my SCHW account, and entered VTSMX and it seems to work fine. I didn't click execute, but it shows minimum $3,000 and is a no transaction fee fund and no sales load.

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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by LocusCoeruleus » Tue Oct 01, 2019 8:10 pm

TD Ameritrade is $0 starting oct 3rd. Source: their website

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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by ResearchMed » Tue Oct 01, 2019 8:14 pm

LocusCoeruleus wrote:
Tue Oct 01, 2019 8:10 pm
TD Ameritrade is $0 starting oct 3rd. Source: their website
I'd guess they had this plan all figured out and approved, and just waiting to push the "go" button when Schwab instituted their zero policy.
... meaning TDA wasn't going to offer that a moment before they had to?

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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by danaht » Tue Oct 01, 2019 8:18 pm

LocusCoeruleus wrote:
Tue Oct 01, 2019 8:10 pm
TD Ameritrade is $0 starting oct 3rd. Source: their website
Great. I didn't see it on their website - but I did see a news article here: https://finance.yahoo.com/news/best-jus ... 00556.html
This is great news. Now Fidelity needs to do the same thing - or else I (and a lot of other people) are going to start transferring assets to TD Ameritrade / Schwab.

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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by student » Tue Oct 01, 2019 8:23 pm

inbox788 wrote:
Tue Oct 01, 2019 10:32 am
student wrote:
Tue Oct 01, 2019 8:31 am
My concern is they may have to save money elsewhere and it may affect customer service.
That was my concern with Fidelity as well. Vanguard has virtually no offices, while Schwab and Fidelity keep a large number of offices and staff. I just looked and found 2 Schwab offices near me (with each having 3 vp/senior financial consultants -- salespeople?). I don't think their financial consultants are fiduciaries, so I wouldn't trust them to be looking out for me.

Any good reasons to visit these Schwab offices?
I wasn't thinking about that. I was thinking about 24/7 call center.

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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by student » Tue Oct 01, 2019 8:25 pm

Hector wrote:
Tue Oct 01, 2019 12:41 pm
student wrote:
Tue Oct 01, 2019 8:31 am
My concern is they may have to save money elsewhere and it may affect customer service.
If other brokers don't match. Schwab would keep getting new money $ in. They make money from their sweep accounts fees (ER of Money Market Funds), by offering their inventory for secondary treasury trading, other commissions on fix income options, bid and spread difference in trading.
True. However, I would think that other brokers are not going to be sitting ducks and will respond in some way.

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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by pkjr » Tue Oct 01, 2019 8:47 pm

True. However, I would think that other brokers are not going to be sitting ducks and will respond in some way.
I wouldn't be surprised If Vanguard’s commission plan stayed unchanged :-)

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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by megabad » Tue Oct 01, 2019 8:49 pm

Hector wrote:
Tue Oct 01, 2019 12:42 pm
indexfundfan wrote:
Tue Oct 01, 2019 12:39 pm
Hector wrote:
Tue Oct 01, 2019 12:35 pm
pkjr wrote:
Tue Oct 01, 2019 8:03 am
it looks like a response to InteractiveBrokers' offering.
What is their offering?
https://ibkr.com/lite
Thanks
Is there another thread on this? It says you lose TWS so how do you trade with the IB lite account? Do you have to use the app?

I have no interest in Schwab until they stop selling order flow because I like brokers that are working for me and not market makers.

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Schwab eliminates commissions on US stocks, ETFs, and options

Post by mathguy3021 » Tue Oct 01, 2019 9:05 pm

[Thread merged into here, see below. --admin LadyGeek]

It looks like the fee wars have erupted again with a game changing decision by Schwab to eliminate commissions on US stocks, ETFs, and options. I am now considering opening up another Roth IRA or taxable account with Schwab to invest in a carefully selected portfolio of individual stocks. I would perform stock level tax loss harvesting with zero commission fees. Is this a good idea?

https://pressroom.aboutschwab.com/press ... wab-remove

student
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Re: Schwab eliminates commissions on US stocks, ETFs, and options

Post by student » Tue Oct 01, 2019 9:07 pm

See an earlier discussion. viewtopic.php?f=10&t=291611

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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by pkjr » Tue Oct 01, 2019 9:14 pm

With IB lite you get web based trading interface.

mathguy3021
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Re: Schwab eliminates commissions on US stocks, ETFs, and options

Post by mathguy3021 » Tue Oct 01, 2019 9:18 pm

Thanks for the link to the previous discussion. It was helpful that TD Ameritrade has also announced the same thing since I have an account with them. I don't need to open the Schwab account. Thanks for this information.

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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by bradinsky » Tue Oct 01, 2019 9:21 pm

Charles Schwab did eliminate about 600 jobs in early September. Maybe that was part of their plan.

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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by baliktad » Tue Oct 01, 2019 9:22 pm

Startled Cat wrote:
Tue Oct 01, 2019 10:19 am
I think this was inevitable and Schwab's competitors will match this move shortly. Brokerages have other revenue sources which are more significant than commissions (see https://www.kalzumeus.com/2019/6/26/how ... ake-money/).
Thanks for this link, this is a fascinating read that explains why this move was inevitable. Great to get an understanding of the brokerage industry Schwab is operating in.

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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by TIAX » Tue Oct 01, 2019 9:25 pm

LocusCoeruleus wrote:
Tue Oct 01, 2019 8:10 pm
TD Ameritrade is $0 starting oct 3rd. Source: their website
Great, now we can all sell SPTM, SPDW and others and buy Vanguard ETFs.

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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by student » Tue Oct 01, 2019 9:29 pm

LocusCoeruleus wrote:
Tue Oct 01, 2019 8:10 pm
TD Ameritrade is $0 starting oct 3rd. Source: their website
Will Etrade be next?

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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by LadyGeek » Tue Oct 01, 2019 9:32 pm

I merged mathguy3021's thread into the on-going discussion. The combined thread is in the Investing - Theory, News & General forum (news).
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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by fru-gal » Tue Oct 01, 2019 9:44 pm

Library_Lady wrote:
Tue Oct 01, 2019 10:31 am
Now if only they’d eliminate mutual fund commissions of $49.95.. :happy
I had two CDs at Schwab I wanted to sell, would have been $20 apiece. I wanted to buy two Vanguard funds with the proceeds, would have been $49.95 apiece, total $139.90 I moved the two CDs to Vanguard ($25 fee for the move), sold them at Vanguard $0, bought the two Vanguard funds at Vanguard $0, moved the two Vanguard funds to Schwab $0.

I can't be the only person who does stuff like this.

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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by student » Tue Oct 01, 2019 9:46 pm

fru-gal wrote:
Tue Oct 01, 2019 9:44 pm
Library_Lady wrote:
Tue Oct 01, 2019 10:31 am
Now if only they’d eliminate mutual fund commissions of $49.95.. :happy
I had two CDs at Schwab I wanted to sell, would have been $20 apiece. I wanted to buy two Vanguard funds with the proceeds, would have been $49.95 apiece, total $139.90 I moved the two CDs to Vanguard ($25 fee for the move), sold them at Vanguard $0, bought the two Vanguard funds at Vanguard $0, moved the two Vanguard funds to Schwab $0.

I can't be the only person who does stuff like this.
Smart.

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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by Raraculus » Tue Oct 01, 2019 10:32 pm

I can't help but remark that this may show a market 'top'.

This reminds me of the Joseph Kennedy's 'a-ha' moment with a shoe shine boy's market tip. Somehow, he knew that the market was oversubscribed if the shoe shine boys are in the market. The greater supply of fools have run out.

The fee-free trend of trading the markets will only exhaust this greater supply of fools, I suspect. This may lead to a market correction.

Hope I'm wrong in making this observation.

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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by usagi » Wed Oct 02, 2019 3:04 am

danaht wrote:
Tue Oct 01, 2019 8:18 pm
LocusCoeruleus wrote:
Tue Oct 01, 2019 8:10 pm
TD Ameritrade is $0 starting oct 3rd. Source: their website
Great. I didn't see it on their website - but I did see a news article here: https://finance.yahoo.com/news/best-jus ... 00556.html
This is great news. Now Fidelity needs to do the same thing - or else I (and a lot of other people) are going to start transferring assets to TD Ameritrade / Schwab.
Exactly. And here I was going to transfer my TD Ameritrade account to Fido since my rep said he would give me free trades at Fido. But I prefer it to be written policy vs a "one of" by my rep.

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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by jeffyscott » Wed Oct 02, 2019 7:21 am

fru-gal wrote:
Tue Oct 01, 2019 9:44 pm
Library_Lady wrote:
Tue Oct 01, 2019 10:31 am
Now if only they’d eliminate mutual fund commissions of $49.95.. :happy
I had two CDs at Schwab I wanted to sell, would have been $20 apiece. I wanted to buy two Vanguard funds with the proceeds, would have been $49.95 apiece, total $139.90 I moved the two CDs to Vanguard ($25 fee for the move), sold them at Vanguard $0, bought the two Vanguard funds at Vanguard $0, moved the two Vanguard funds to Schwab $0.

I can't be the only person who does stuff like this.
Doesn't Vanguard charge the same $1 per $1000 on secondary CDs, and $2 if you have less than a certain amount of assets there?

There are a lot of NTF mutual funds at Schwab, not Vanguard's, of course.
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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by inbox788 » Wed Oct 02, 2019 10:12 am

bradinsky wrote:
Tue Oct 01, 2019 9:21 pm
Charles Schwab did eliminate about 600 jobs in early September. Maybe that was part of their plan.
Interesting that it works out to about 3% of jobs, same as 3% drop in revenues from cutting commissions. Now they just have to cut 3% from the reset of their costs to be back to even.
https://www.cnbc.com/2019/09/11/brokera ... -jobs.html
student wrote:
Tue Oct 01, 2019 8:23 pm
I wasn't thinking about that. I was thinking about 24/7 call center.
What does a 3% cut in staff look like? Long wait times? Slower service? Cutting some offices could probably keep more of the online services staffed. We'll see where their priorities are heading. Don't forget, they can expect an increase in volume from this as well which may actually help their bottom line if they can take customers from other brokerages, but service levels may suffer.
megabad wrote:
Tue Oct 01, 2019 8:49 pm
Is there another thread on this? It says you lose TWS so how do you trade with the IB lite account? Do you have to use the app?

I have no interest in Schwab until they stop selling order flow because I like brokers that are working for me and not market makers.
Order flow. So that's were they're going to be able to generate some revenue? I don't like fees any more than then next guy, but they've got to balance the books somehow, and I'd like to know what's their cost and fee model and that it's sustainable.

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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by fru-gal » Wed Oct 02, 2019 10:52 am

jeffyscott wrote:
Wed Oct 02, 2019 7:21 am
fru-gal wrote:
Tue Oct 01, 2019 9:44 pm
Library_Lady wrote:
Tue Oct 01, 2019 10:31 am
Now if only they’d eliminate mutual fund commissions of $49.95.. :happy
I had two CDs at Schwab I wanted to sell, would have been $20 apiece. I wanted to buy two Vanguard funds with the proceeds, would have been $49.95 apiece, total $139.90 I moved the two CDs to Vanguard ($25 fee for the move), sold them at Vanguard $0, bought the two Vanguard funds at Vanguard $0, moved the two Vanguard funds to Schwab $0.

I can't be the only person who does stuff like this.
Doesn't Vanguard charge the same $1 per $1000 on secondary CDs, and $2 if you have less than a certain amount of assets there?
I dunno, Vanguard has never charged me anything for either buying or selling a CD. When I was about to sell the CDs at Schwab, the Schwab guy said $20 apiece since I would be selling them before maturity.

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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by RetiredAL » Wed Oct 02, 2019 11:26 am

usagi wrote:
Wed Oct 02, 2019 3:04 am
danaht wrote:
Tue Oct 01, 2019 8:18 pm
LocusCoeruleus wrote:
Tue Oct 01, 2019 8:10 pm
TD Ameritrade is $0 starting oct 3rd. Source: their website
Great. I didn't see it on their website - but I did see a news article here: https://finance.yahoo.com/news/best-jus ... 00556.html
This is great news. Now Fidelity needs to do the same thing - or else I (and a lot of other people) are going to start transferring assets to TD Ameritrade / Schwab.
Exactly. And here I was going to transfer my TD Ameritrade account to Fido since my rep said he would give me free trades at Fido. But I prefer it to be written policy vs a "one of" by my rep.
When I moved my Dad's IRA to Schwab, I asked for and got enough free trades (around 60) to liquidate all of the stocks and funds per verbal. After ending the call, he called me back to let me know the free trades batch overnight, so wait until tomorrow to make the trades. All went well.


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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by jeffyscott » Wed Oct 02, 2019 12:20 pm

fru-gal wrote:
Wed Oct 02, 2019 10:52 am
jeffyscott wrote:
Wed Oct 02, 2019 7:21 am
fru-gal wrote:
Tue Oct 01, 2019 9:44 pm
Library_Lady wrote:
Tue Oct 01, 2019 10:31 am
Now if only they’d eliminate mutual fund commissions of $49.95.. :happy
I had two CDs at Schwab I wanted to sell, would have been $20 apiece. I wanted to buy two Vanguard funds with the proceeds, would have been $49.95 apiece, total $139.90 I moved the two CDs to Vanguard ($25 fee for the move), sold them at Vanguard $0, bought the two Vanguard funds at Vanguard $0, moved the two Vanguard funds to Schwab $0.

I can't be the only person who does stuff like this.
Doesn't Vanguard charge the same $1 per $1000 on secondary CDs, and $2 if you have less than a certain amount of assets there?
I dunno, Vanguard has never charged me anything for either buying or selling a CD. When I was about to sell the CDs at Schwab, the Schwab guy said $20 apiece since I would be selling them before maturity.
Ah, it looks like they only charge to buy: All sales of CDs before they mature are commission-free.
https://investor.vanguard.com/investing ... /cds-bonds

Schwab must charge the commission on both sides.
Time is your friend; impulse is your enemy. - John C. Bogle

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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by whodidntante » Wed Oct 02, 2019 12:27 pm

Raraculus wrote:
Tue Oct 01, 2019 10:32 pm
I can't help but remark that this may show a market 'top'.

This reminds me of the Joseph Kennedy's 'a-ha' moment with a shoe shine boy's market tip. Somehow, he knew that the market was oversubscribed if the shoe shine boys are in the market. The greater supply of fools have run out.

The fee-free trend of trading the markets will only exhaust this greater supply of fools, I suspect. This may lead to a market correction.

Hope I'm wrong in making this observation.
I don't know where the top will be either, and maybe it was two days ago. You can't see the high water mark while the water is still high. But your argument seems specious to me. Lower costs are a good thing for investors whether markets crash or not.

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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by MFInvestor » Wed Oct 02, 2019 5:14 pm

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

Reported by CNBC
https://www.cnbc.com/2019/10/02/e-trad ... e-war.html

E-Trade is getting rid of commission fees on 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.

E-Trade estimates a quarterly revenue impact of $75 million from dropping fees.
E-Trade’s new fee structure will start on October 7. Options will still have a 65 cents charge per contract.

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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by comeinvest » Wed Oct 02, 2019 6:52 pm

Jack FFR1846 wrote:
Tue Oct 01, 2019 9:39 am
Schwab has been trolling existing customers for new money, offering bonuses. I just transferred my SCHB dividend out this morning. Will wait until we pay for our new roof, then transfer money into Schwab and buy something, gaining $200 ($50k investment min). Perfect timing for me!
Do you have a link for the promotions for adding funds for *existing* Schwab customers? All links that I found on other web sites did no longer work.

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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by comeinvest » Wed Oct 02, 2019 7:31 pm

Given this chart and the disappearance of money market sweep funds, the key to outsmarting your broker seems to be in minimizing residual cash. Stock and ETF prices are typically somewhere between $10 and $60. Does anybody have first hand information on how odd lot orders are routed and filled in terms of priority vs. round lot orders? Particularly non-marketable odd lot limit orders i.e. buy at bid and sell at ask?

On another note, frankly, as a passive investor I personally would prefer low commissions and sweep funds like most brokers had a few years ago vs. the current situation of zero commissions. If you do the math, the lost interest often outweighs commissions over a year.

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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by AHTFY » Wed Oct 02, 2019 7:56 pm

comeinvest wrote:
Wed Oct 02, 2019 7:31 pm
On another note, frankly, as a passive investor I personally would prefer low commissions and sweep funds like most brokers had a few years ago vs. the current situation of zero commissions. If you do the math, the lost interest often outweighs commissions over a year.
I have $14 sitting in cash in my TD Ameritrade account. The rest of my cash is in my Vanguard money market or my bank. I'll take the free trades over higher interest rates on that $14.

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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by comeinvest » Wed Oct 02, 2019 8:11 pm

AHTFY wrote:
Wed Oct 02, 2019 7:56 pm
comeinvest wrote:
Wed Oct 02, 2019 7:31 pm
On another note, frankly, as a passive investor I personally would prefer low commissions and sweep funds like most brokers had a few years ago vs. the current situation of zero commissions. If you do the math, the lost interest often outweighs commissions over a year.
I have $14 sitting in cash in my TD Ameritrade account. The rest of my cash is in my Vanguard money market or my bank. I'll take the free trades over higher interest rates on that $14.
The picture will change if you have larger accounts with lots of dividends and/or you use it as checking account.

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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by fru-gal » Thu Oct 03, 2019 8:20 am

jeffyscott wrote:
Wed Oct 02, 2019 12:20 pm
fru-gal wrote:
Wed Oct 02, 2019 10:52 am
jeffyscott wrote:
Wed Oct 02, 2019 7:21 am
fru-gal wrote:
Tue Oct 01, 2019 9:44 pm
Library_Lady wrote:
Tue Oct 01, 2019 10:31 am
Now if only they’d eliminate mutual fund commissions of $49.95.. :happy
I had two CDs at Schwab I wanted to sell, would have been $20 apiece. I wanted to buy two Vanguard funds with the proceeds, would have been $49.95 apiece, total $139.90 I moved the two CDs to Vanguard ($25 fee for the move), sold them at Vanguard $0, bought the two Vanguard funds at Vanguard $0, moved the two Vanguard funds to Schwab $0.

I can't be the only person who does stuff like this.
Doesn't Vanguard charge the same $1 per $1000 on secondary CDs, and $2 if you have less than a certain amount of assets there?
I dunno, Vanguard has never charged me anything for either buying or selling a CD. When I was about to sell the CDs at Schwab, the Schwab guy said $20 apiece since I would be selling them before maturity.
Ah, it looks like they only charge to buy: All sales of CDs before they mature are commission-free.
https://investor.vanguard.com/investing ... /cds-bonds

Schwab must charge the commission on both sides.
Vanguard has never charged me anything when I buy CDs either.

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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by jeffyscott » Thu Oct 03, 2019 8:41 am

fru-gal wrote:
Thu Oct 03, 2019 8:20 am
Vanguard has never charged me anything when I buy CDs either.
They do not charge an added commission for new issues and neither do Schwab or Fidelity. So if you only buy new issues there is no commission charge added.

They do charge for secondary CDs. As you can see from the commission schedule, they charge either $1 or $2 per $1000 for existing (aka. secondary) CDs, Fidelity and Schwab charge everyone $1, with $10 minimum in Schwab's case.
Time is your friend; impulse is your enemy. - John C. Bogle

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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by cheesepep » Thu Oct 03, 2019 6:25 pm

I've decided to move my entire Chase You Invest account over to Schwab.....in a couple of months. I still got free trades at Chase to use up. Maybe Chase will also offer free trades. Just got to wait and see. In the meantime, I loaded up on more MMAs.

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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by TIAX » Fri Oct 04, 2019 11:04 am

comeinvest wrote:
Wed Oct 02, 2019 8:11 pm
AHTFY wrote:
Wed Oct 02, 2019 7:56 pm
comeinvest wrote:
Wed Oct 02, 2019 7:31 pm
On another note, frankly, as a passive investor I personally would prefer low commissions and sweep funds like most brokers had a few years ago vs. the current situation of zero commissions. If you do the math, the lost interest often outweighs commissions over a year.
I have $14 sitting in cash in my TD Ameritrade account. The rest of my cash is in my Vanguard money market or my bank. I'll take the free trades over higher interest rates on that $14.
The picture will change if you have larger accounts with lots of dividends and/or you use it as checking account.
Use dividend reinvestment?

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jeffyscott
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Re: Charles Schwab (SCHW) Eliminating Commissions for Stocks, ETFs and Options Listed on U.S. or Canadian Exchanges

Post by jeffyscott » Fri Oct 04, 2019 11:50 am

comeinvest wrote:
Wed Oct 02, 2019 8:11 pm
The picture will change if you have larger accounts with lots of dividends and/or you use it as checking account.
Can you even use the Schwab settlement account as a checking account? Schwab has actual checking accounts for that. The interest paid by Schwab on checking is also not great, but is better than what a lot of others pay. At least there are no fees and no minimum balance for checking and settlement accounts, so it's pretty easy to keep a minimal balance.

I'm not sure why having a larger account would mean that one needs to keep a larger amount of cash earning next to nothing in the settlement account? If dividends are not automatically reinvested, then it does mean that you would want to manually do something with them, whatever the account size.
Time is your friend; impulse is your enemy. - John C. Bogle

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