BOSTON--(BUSINESS WIRE)--Reaffirming its longstanding commitment to provide the best overall value in the industry, Fidelity Investments®, the largest online brokerage firm with 17.9 million accounts and $1.7 trillion in total client assets2, today significantly reduced online retail commissions for U.S. stock and ETF trades to $4.95, down from $7.95, making it the lowest-priced provider among major retail competitors, including TD Ameritrade, Schwab and E*Trade3. Fidelity also reduced option pricing to $0.65 per contract4, down from $0.75, and lowered margin rates across multiple tiers, making both the lowest price among its major retail competitors.
|Online U.S. equity and option trades||$4.95||$9.99||$6.95||$9.99|
|Online Options pricing per contract||$0.65||$0.75||$0.70||$0.75|
Lowest Margin Rate5
Table compares pricing for retail investors.
Fidelity’s online U.S. stock trading commissions are 50 percent lower than both TD Ameritrade and E*Trade, 28 percent lower than Schwab, and 45 percent lower than the average of the three competitors.
1 At $4.95 flat rate commissions for on-line US equity and ETF trades in retail accounts, Fidelity is 50.45 percent lower than TD Ameritrade and E*Trade’s standard commissions of $9.99, and 28.77 percent lower than Schwab’s standard commission of $6.95.
“With these unprecedented price cuts Fidelity is continuing to transform the brokerage industry, bringing the best value to retail clients,” said Ram Subramaniam, president of Fidelity’s retail brokerage business. “Our active trader clients who make hundreds of trades each year will particularly benefit from our dramatic price reductions, and all clients who trade will be able to keep more money in their pockets.”
Continued Subramaniam, “We encourage investors to evaluate their firm on the overall value they receive. Fidelity clients have the best of both worlds – low pricing as well as consistently top-ranked order execution, client service, trading and research tools, education and investment choices.”
In addition to the new low $4.95 online U.S. equity commissions, Fidelity offers clients leading value in:
- Price Improvement: Fidelity’s client-centric routing decisions resulted in an average $10.79 price improvement per 1,000 share order vs. the industry average of $1.716, and Fidelity is the only firm to display price improvement for each trade7. In Fidelity’s Brokerage Value Study8, three in four investors (76 percent) say they would consider changing to a firm that delivers superior price improvement.
- Order Execution: Fidelity is the only one of the four biggest brokerage firms (Fidelity, TD Ameritrade, Schwab and E*Trade) to not take payment for order flow for equity orders, ensuring that the price and speed of clients’ equity orders are given priority.
- Online Options: Fidelity now offers the lowest online options prices among TD Ameritrade, Schwab and E*Trade, at $4.95 per trade + $0.65 per contract, and couples this low price with sophisticated options trading and education tools.
- Margin Rates: Fidelity’s reduced margin rates for retail clients make it the lowest cost provider among TD Ameritrade, Schwab and E*Trade across all debit balances:
- Bond Pricing: Fidelity offers transparent $1 pricing for online secondary bond market trades, and an Oct. 2015 study9 showed that online bond prices from brokers that bundle their markups and fees into their online bond prices were on average $13.65 per bond higher than Fidelity. For an investor who purchases $100,000 in face value of bonds annually online, that discrepancy could save $1,365 on average each year compared to mark-up based brokers.
- Award-Winning Free Research Tools and Education that can help investors increase their knowledge and find the best investments for their needs.
- Commission-Free ETFs and No Transaction Fee Mutual Funds: Fidelity offers 91 highly liquid and diverse Blackrock iShares® and Fidelity ETFs available for purchase commission-free online10. And, more than 3,500 NTF mutual funds are available on Fidelity.com, part of the 11,000+ mutual funds available at Fidelity overall.
In 2016, Fidelity became the first firm ever to sweep the brokerage industry award season, including wins in Barron’s, Investor’s Business Daily, Kiplinger’s, StockBrokers.com and Corporate Insight for overall value, innovation, transparency and client experience. In 2017, Fidelity has again earned best overall brokerage scores from Corporate Insight11 and Investor’s Business Daily12.
“We’re focused on delivering the best client experience in the industry, and a big part of that is providing investors with choice and exceptional value across asset classes, investment styles and investment vehicles. This move will strengthen our leadership position and provide even greater value for our millions of clients,” added Subramaniam.
To help investors evaluate how to get the best overall value and bang for their buck from a brokerage firm, Fidelity encourages investors to consider the following:
3. Is the firm in good financial standing and is it a trusted brand?
4. Does the firm offer the selection of investments I need to achieve my investing and cash management goals?
6. What options do I have for client service (e.g. phone, chat, email, in person) and is it available when I need it?
Also, see a Fidelity Viewpoint about “How to Pick Your Brokerage Firm.”
About Fidelity Investments
Fidelity’s mission is to inspire better futures and deliver better outcomes for the clients and businesses we serve. With assets under administration of $5.8 trillion, including managed assets of $2.2 trillion as of January 31, 2017, we focus on meeting the unique needs of a diverse set of clients: helping more than 26 million people invest their own life savings, 23,000 businesses manage employee benefit programs, as well as providing more than 12,500 financial advisory firms with investment and technology solutions to invest their own clients’ money. Privately held for 70 years, Fidelity employs 45,000 associates who are focused on the long-term success of our clients. For more information about Fidelity Investments, visit https://www.fidelity.com/about.
Investing involves risk, including the risk of loss.
Free commission offer applies to online purchases of Fidelity ETFs and select iShares ETFs in a Fidelity brokerage account. Some Fidelity accounts may require a minimum balance of $2,500. Certain account minimums are waived with the setup of automatic periodic investing. The sale of ETFs is subject to an activity assessment fee (from $0.01 to $0.03 per $1,000 of principal). iShares ETFs and Fidelity ETFs are subject to a short-term trading fee by Fidelity if held less than 30 days.
$4.95 commission applies to online U.S. equity trades in a Fidelity retail account only for Fidelity Brokerage Services LLC retail clients. Certain accounts may require a minimum opening balance of $2,500. Sell orders are subject to an activity assessment fee (from $0.01 to $0.03 per $1,000 of principal). Other conditions may apply. See Fidelity.com/commissions for details. Employee equity compensation transactions and accounts managed by advisors or intermediaries through Fidelity Clearing and Custody Solutions are subject to different commission schedules.
Minimum concessions of $19.95 apply if traded with a Fidelity representative. For U.S. Treasury purchases traded with a Fidelity representative, a flat charge of $19.95 per trade applies. A $250 maximum applies to all trades, reduced to a $50 maximum for bonds maturing in one year or less. Fixed income trading requires a Fidelity brokerage account with a minimum opening balance of $2,500. Rates are for U.S. dollar–denominated bonds; additional fees and minimums apply for non-dollar bond trades. Other conditions may apply; see Fidelity.com/commissions for details. Please note that concessions may affect the total cost of the transaction and the total, or "effective," yield of your investment. The offering broker, which may be our affiliate National Financial Services LLC, may separately mark up or mark down the price of the security and may realize a trading profit or loss on the transaction.
ETFs are subject to market fluctuation and the risks of their underlying investments. ETFs are subject to management fees and other expenses. Unlike mutual funds, ETF shares are bought and sold at market price, which may be higher or lower than their NAV, and are not individually redeemed from the fund.
Options trading entails significant risk and is not appropriate for all investors. Certain complex options strategies carry additional risk. Before trading options, contact Fidelity Investments by calling 800-544-5115 to receive a copy of Characteristics and Risks of Standardized Options. Supporting documentation for any claims, if applicable, will be furnished upon request.
There is an Options Regulatory Fee from $0.04 to $0.06 per contract, which applies to both option buy and sell transactions. The fee is subject to change.
Certain FundsNetwork funds may be subject to separate and additional redemption fees imposed by the particular fund. Investors should refer to that fund's current prospectus for details.
Fidelity Investments and Fidelity are registered service marks of FMR LLC.
Fidelity is not affiliated with any third parties named herein.
Third-party web sites linked to herein are unaffiliated with Fidelity. Fidelity has not been involved in the preparation of the content supplied at the unaffiliated site and does not guarantee or assume any responsibility for its content.
Fidelity Brokerage Services LLC, Member NYSE, SIPC
900 Salem Street, Smithfield, RI 02917
Fidelity Investments Institutional Services Company, Inc.,
500 Salem Street, Smithfield, RI 02917
National Financial Services LLC, Member NYSE, SIPC,
200 Seaport Boulevard, Boston, MA 02110
© 2017 FMR LLC. All rights reserved.
1 Investor’s Business Daily, Best
Online Brokers, Jan. 30, 2017, Fidelity ranked highest
overall for Research Tools, Educational Resources, Investment Research,
Portfolio Analysis/Reports and Planning Tools. As well, see https://www.fidelity.com/about-fidelity/individual-investing/fidelity-sweeps-award-season
for a summary of Fidelity’s best overall brokerage wins in the first
four months of 2016.
2 Based on internal business data as of Dec. 31, 2016.
3 Commission comparison based on published website commission schedules for retail accounts, as of 2/2/2017, for E*Trade, Schwab, and TD Ameritrade for online U.S. equity trades. For E*Trade: $9.99 per trade for 0 to 149 trades, $7.99 per trade for 150 to 1,499 trades, and $6.99 per trade for 1,500 or more trades per quarter. For Schwab: $6.95 for up to 999,999 shares per trade, though orders of 10,000 or more shares or greater than $500,000 may be eligible for special pricing and employee equity compensation transactions are subject to separate commission schedules. For TD Ameritrade: $9.99 per market or limit order trade for an unlimited amount of shares. Commissions are subject to change without notice. See each provider’s website for any additional information and restrictions.
4 There is an Options Regulatory Fee from $0.04 to $0.06 per contract, which applies to both option buy and sell transactions. The fee is subject to change.
5 4.00% rate available for debit balances over $500,000. Fidelity's current Base Margin Rate, effective since 12/15/2016, is 6.825%.
6Based on data from RegOne Technologies for SEC Rule 605 eligible orders executed at Fidelity between October 1, 2015 and September 30, 2016. The comparison is based on an analysis of price statistics that include marketable orders: market orders and limit orders at the National Best Bid and offer (NBBO), between 100 – 1,999 shares, excluding orders with special handling instructions and order sizes greater than 2,000 shares. A data range of 100 – 499 shares is used for the 100 shares order size and a data range of 100 — 1,999 shares is used for the 1,000 shares order size. Average price improvement for order sizes outside of these data ranges will vary. Fidelity's average retail order size for SEC Rule 605 eligible orders during this time period was 446 shares, or 1008 shares when including block trades. Price improvement examples are based on averages and any price improvement amounts related to your trades will depend on the particulars of your specific trade.
7Price improvement details provided for domestic stock and single leg option orders entered during market hours after the primary opening, provided there is a National Best Bid and Offer (NBBO) at the time the order is placed. Price improvement details are provided for informational purposes only and are not used for regulatory reporting purposes.
8 ORC International conducted interviews with a total of 1,000 investors. To qualify, investors had to be 25 years old or older, have investable assets of at least $10,000, trade stocks, mutual funds, ETFs, options or bonds, be the sole or primary investment decision-maker, and not delegate all decisions to an investment professional. Interviewing took place April 16 -28, 2015. Fidelity and ORC International are not affiliated.
9 Fidelity commissioned Corporate Insight to study bond pricing, available online, for self-directed retail investors from five brokers that offer corporate and municipal bonds. The study compared online bond prices for over 20,000 municipal and corporate inventory matches between September 2nd and October 6th, 2015. It compared municipal and corporate inventories offered online. The study found on average that four competitors that bundled their markups or fees into their online bond prices were asking an average of $13.65 more per bond. Corporate Insight determined the average cost differential by calculating the difference between the costs of matching corporate and municipal bond inventory at Fidelity vs. these markup-based firms in the study, then averaging the differences across all of the competitor firms.
10 For iShares ETFs, Fidelity receives compensation from the ETF sponsor and/or its affiliates in connection with an exclusive long-term marketing program that includes promotion of iShares ETFs and inclusion of iShares funds in certain FBS platforms and investment programs. Additional information about the sources, amounts, and terms of compensation can be found in the ETF’s prospectus and related documents. Fidelity may add or waive commissions on ETFs without prior notice. BlackRock and iShares are registered trademarks of BlackRock Inc., and its affiliates.
11 Corporate Insight, January 2017. Corporate Insight's annual 2016 e-Monitor Awards recognized Fidelity's online brokerage offering with a gold medal for Account Information, Quotes, and Prospect Experience. Nineteen firms were evaluated on six distinct categories: Account Information, Quotes, Trading, Online Help, Prospect Experience, and Mobile Capabilities. A gold medal is awarded to those firms that offer products, tools, or website features that are innovative and extensive, meeting or exceeding all the criteria established in each category, which may have numerous gold-medal winners.
12 Investor’s Business Daily (IBD), January 2015, 2016, and 2017 Best Online Brokers Special Reports. January 2015: Fidelity ranked in the top five in 9 out of 11 categories—more than any other competitor. Fidelity was named first in Research Tools, Investment Research, Portfolio Analysis and Reports, and Educational Resources. January 2016: Fidelity ranked in the top five in 10 out of 12 categories. Fidelity was named first in Trade Reliability, Research Tools, Investment Research, Portfolio Analysis and Reports, and Educational Resources. January 2017: Fidelity ranked in the top two in all 13 categories. Fidelity was named first in Research Tools, Portfolio Analysis and Reports, Investment Research, Educational Resources, and Investment and Retirement Planning Tools. Results for all three reports were based on having the highest Customer Experience Index within the categories composing the surveys, as scored by more than 4,752 investors by IBD and its polling partner, TechnoMetrica Market Intelligence.