Charles Schwab just lowered their trade fees from $8.95 to
$6.95 starting March 1st.
They also lowered the expense ratio for some of their index funds:
Here's How Charles Schwab Is Waging Its War On Stock, ETF And Fund Fees
Charles Schwab cutting fees again
Shares of
Charles Schwab (
SCHW) fell Thursday as the leading online broker announced that it will cut its trade commissions on stocks and ETFs starting Friday and lower expenses on its index mutual funds starting March 1.
Schwab will reduce its standard online equity and ETF trade commissions from $8.95 to $6.95, making them lowest among rivals such as Fidelity, Vanguard,
TD Ameritrade (
AMTD) and
E-Trade (
ETFC). Commissions at those competitors range from $7 to $20.
Expenses on Schwab's cap-weighted index mutual funds also will be aligned with their ETF counterparts, putting them among the lowest in the industry. Investment minimums are being eliminated for those Schwab funds and a single share class will be used, enabling even the smallest investor to pay the lowest possible fees, according to Schwab.
"Any investor will pay the same best rate across the board," Schwab CEO Walt Bettinger said in a call with analysts. He described his firm's latest moves as "critical for growth in the future."
The new expense ratios on Schwab S&P 500 Index Fund (SWPPX) and Schwab Small-Cap Index Fund (SWSSX) are 0.03% and 0.06%, respectively. Schwab U.S. Aggregate Bond Index Fund, set to launch Feb. 23, will charge 0.04%.
Competing index funds from Fidelity and Vanguard cost anywhere from three to five times more for a $5,000 investment, Bettinger pointed out.