US brokers may charge fee from ETF managers as commission-free trading takes a toll
U.S. brokerage firms and custodians may seek distribution fees from managers of exchange-traded funds, J.P. Morgan said, marking a possible crucial shift in the country's $13.5 trillion ETF market. Platforms such as Robinhood attracted millions of retail investors with zero trading fees and simple mobile apps, pulling customers and trading volume away from traditional brokerages. To combat the shift in the competitive landscape, legacy players such as Fidelity and Charles Schwab have raced to win over clients by slashing trade commissions to as low as zero dollars for exchange-traded funds.
U.S. brokerage firms and custodians may seek distribution fees from managers of exchange-traded funds, J.P. Morgan said, marking a possible crucial shift in the country's $13.5 trillion ETF market. Platforms such as Robinhood attracted millions of retail investors with zero trading fees and simple mobile apps, pulling customers and trading volume away from traditional brokerages. To combat the shift in the competitive landscape, legacy players such as Fidelity and Charles Schwab have raced to win over clients by slashing trade commissions to as low as zero dollars for exchange-traded funds.
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