Schwab had lowered online trading fees for equity trades by more than 30% to $8.95.
Not to be outdone, Fidelity responded by lowering commissions to $7.95 per online equity trade.
In addition, 25 ETFs from iShares joined their growing cache of NTF (no transaction fee) offerings.
With an outstanding array of mutual funds and investing services to choose from, not to mention the brand name appeal, Fidelity raised the level of competition for all discount brokers.
They make the case that you should park your hard earned dollars in their accounts because:
Unfortunately, there are no claims about making you money or keeping you from losing money. And rightly so, as there is no way for anyone to guarantee either.
The problem with the statement above is that the size of their accounts can't be used a proxy for your success. But that is exactly what they (and over other brokerage firm for that matter) are trying to say.
Give us your money...everyone else does.
I chose to open a retirement investment account with Fidelity for 3 reasons:
I keep costs low by using NTF funds, and the DRIP program automatically reinvests dividends for me. Since my retirement accounts are long-term investments, I am attempting to leverage the effects of compounding with an immediate tax burden.
But for most other investors and traders, the lower commissions rate now offered by Fidelity is too good to pass up, given their vast array of no transaction fee funds and tools.