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Charles Schwab charging zero commissions for stocks & ETFS starting 10/7

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Schwab announced today they will be dropping online commission charges for stocks and ETFs that trade in the US and Canada starting 10/7/19.

https://www.wsj.com/articles/char...1569935983
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Created 10-01-2019 at 12:52 PM by jc4jax
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#2
I guess Robinhood got their attention?
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10-01-2019 at 01:09 PM
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#4
Quote from Brillient
:
I guess Robinhood got their attention?
Not really, the financial sector has been lowering fees and costs in many areas for the past decade, the most profitable area now is wealth management. Millennials are the bigger demographic even to the Baby Boomers, and are growing in wealth and have a long time horizon being so young. They want to capture a large market share and get in front of them.

Second, there is very high probability of a major market correction (recession) in the near future, 12-18 mo. and when you have a large drop in the market especially with inexperienced investors they are more open to get into a managed account service. Fear and greed drives the market and the timing of this announcement is very strategic for them positioning themselves.
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Last edited by jc4jax October 1, 2019 at 05:53 PM.
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#5
Quote from jc4jax
:
Not really, the financial sector has been lowering fees and costs in many areas for the past decade, the most profitable area now is wealth management. Millennials are the bigger demographic even to the Baby Boomers, and are growing in wealth and have a long time horizon being so young. They want to capture a large market share and get in front of them.

Second, there is very high probability of a major market correction (recession) in the near future, 12-18 mo. and when you have a large drop in the market especially with inexperienced investors they are more open to get into a managed account service. Fear and greed drives the market and the timing of this announcement is very strategic for them positioning themselves.

Robin Hood is very limited in their trade system restricting most clients to 3 trades a week unless they are a gold account client.
Where do you get 3 trades a week ? They just limit day trading. If you exceed more than 3 day trades in 5 business days then they will lock the account for sometime.
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#6
Any sign up promos with Chuck?
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#7
Quote from jc4jax
:
Not really, the financial sector has been lowering fees and costs in many areas for the past decade, the most profitable area now is wealth management. Millennials are the bigger demographic even to the Baby Boomers, and are growing in wealth and have a long time horizon being so young. They want to capture a large market share and get in front of them.

Second, there is very high probability of a major market correction (recession) in the near future, 12-18 mo. and when you have a large drop in the market especially with inexperienced investors they are more open to get into a managed account service. Fear and greed drives the market and the timing of this announcement is very strategic for them positioning themselves.

Robin Hood is very limited in their trade system restricting most clients to 3 trades a week unless they are a gold account client.
3 trades a week? That's just bullshit.

They only have PDT restriction which you can bypass if you keep $25k+ in your account. ​
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#8
I'm not a day trader by any means but this will save me about $100 every quarter (3 months) in trade-related fees. I had a promotion that allowed me to transfer my accounts over to Schwab with $0 commissions on trades (stocks/ETFs) for 2 years which was going to expire in Feb '20 so I'm finding this to be the best news on the market today since S&P fell 1.23%.

In my opinion, they should have considered a subscription model first ($20 a month for 100 trades) as subscriptions are all the rage these days. It benefits me that it didn't go this way. Applause

Having zero commissions though will encourage more frequent or risky trades since people don't have to cover the $4.95 on the buy & sell side of the transaction in order to be profitable.

This may also change people's strategies when it comes to dividend reinvestment plan (DRIP). They may just start to pool their dividends together and buy oversold equities (vs re-investing them into a stock that may already be overpriced). I'm already considering this for my positions that are high on the RSI (Relative Strength Index).

Good luck to all you pajama traders (like myself) and remember...Bulls make money, bears make money and pigs get slaughtered so don't get too greedy!!
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#9
I hope that Fidelity and TD Ameritrade follow Chuck's lead.

Competition is always good.
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#10
Quote from vickh
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Any sign up promos with Chuck?
Yes, you can get up to $500
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#11
Since moving my investments to Schwab from Vanguard 2 years ago I wish I had done it earlier. With Vanguard, it was always a different person who answered and most reps sounded like they were straight out of school. Schwab's advisors have done well by me and up YTD 10.65% with a 50/50 mix of stocks and bonds. Another plus for Schwab is they have branches vs no branches for Vanguard.
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#12
Quote from jimx200
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Since moving my investments to Schwab from Vanguard 2 years ago I wish I had done it earlier. With Vanguard, it was always a different person who answered and most reps sounded like they were straight out of school. Schwab's advisors have done well by me and up YTD 10.65% with a 50/50 mix of stocks and bonds. Another plus for Schwab is they have branches vs no branches for Vanguard.
SPY is up 20% YTD
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#13
Quote from craigg
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I hope that Fidelity and TD Ameritrade follow Chuck's lead.

Competition is always good.
TD Ameritrade matched...should go live October 3rd!
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#14
Quote from POLAYER1
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TD Ameritrade matched...should go live October 3rd!
I see it on their homepage. This is good news. In my opinion ThinkorSwim always had the best trading platform but was more expensive even with a negotiated discount.
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#15
Fidelity will have to do it also, if not I am moving and going to Schwab.
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