It seems that Charles Schwab’s surprise decision to drop commissions for online stock trades to $8.95 is likely to create a price war that could see some smaller players join forces with their competitors.
Included in Schwab’s competitors, E-Trade Financial charges a regular commission of $12.99, but offers trading fees of $6.99 to $9.99 for more consistent traders.
Also TD Ameritrade’s clients are charged $9.99 per online stock trade.
If this is the case, Schwab will become the lowest-priced offering inside the large discount brokerages. Scottrade’s clients still pay a lower amount at $7 per stock trade.
Is Schwab’s Decision to drop commission’s a good idea?
