Fidelity Investments said it eliminates trading commissions and becomes the latest company to reduce brokerage fees as rival investment platforms chase larger market shares.
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Fidelity said it would cut fees to $ 0 on online trading with US stocks, eliminating a $ 4.95 cost for such trades. The Boston-based company's fee changes also include exchange-traded funds and option transactions. For investment advisers, commissions will be reduced to November 4. Fidelity's online brokerage has 21.8 million accounts, the Wall Street Journal reported.
Fidelity's move comes about a week after Charles Schwab Corp .
SCHW, + 1.25%
AMTD, + 1.05%
and E-Trade Financial Corp.
ETFC, + 2.60%
announcing plans to follow shortly thereafter.
Interactive Brokers Group Inc .
IBKR, + 0.07%
also announced two weeks ago that it was rolling out a new "small" version of its trading platform with free, unlimited US equities trading.
The rapidly diminishing fees are a new round in a continuous run to shrink brokerage fees, and Fidelity represents the last major holdout among the brokerages of the brokerage industry that goes to zero commission.
Last week, stocks in these discount brokers fell on Schwab's announcement because investors worried that a new commission war would come that could hurt revenue and force smaller competitors to merge.
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Also read Barron's free trade has arrived. Be sure to read the fine print