"In a world of equal situations, that's all you have to offer," said Steve Quirk, executive vice president of trade and education at TD Ameritade in an interview with CNN Business.
Quirk said that investing is more than just free commissions. He claims that TD Ameritrade offers more services and advice than many competitors to help people who have questions about what types of stocks and ETFs to buy.
E-Trade advertised its customer service and easy-to-use technology. The company recently launched a service that allows clients to use Google Assistant voice commands to verify their brokerage accounts, such as
Brokers need to advertise products that exceed zero fees
"The price has not really been a competitive differentiator for some time we have always believed that this is about customer experience more than anything else, ”said Alice Milligan, Chief E-Commerce Director, in an email to CNN Business.
Schwab was not immediately available for comment on this story.
Schwab and E-Trade shares have fallen by almost 15% since Schwab announced on October 1 that it was the removal of commissions. TD Ameritrade's shares have fallen more than 25%. And online brokers are also down more than 10%.
The online brokerage business is growing more
Competition in the industry remains fierce.
Several more companies announced no-fee brokerage plans for the last week. And many are adding their own twist to try to stand out from the pack.
Robinhood, one of the first online brokers to go nil commission when it launched in 2013, advertised last weekend about the steps taken by Schwab, TD Ameritrade and E-Trade. Tag: The change won't happen overnight until it happens.
StockTwits, a social networking company, has also launched its own online brokerage offer at no charge. Phil Perlman, CEO of StockTwits, said the company hopes to take advantage of the idea that younger merchants want to share ideas. So, as part of its Trade App online brokers, users can post – or "trade" their trading history.
"This is the heart of social commerce. You trade and you can see your subscribers there. This is the Trusted Book of your trading history," Perlman said.
Keep track of the other fees
 Some brokers emphasize that investing more than stocks and ETFs – and that these offers can generate new revenue.
TradeStation – which also simply eliminated commissions – plans to start trading cryptocurrency later this month, said John Bartleman, president of the company. Unlike its free trading platform, TradeStation will charge small fees for trading Bitcoins, Ethereum, Ripple / XRP, and several other cryptocurrencies.
"We are going after serious dealers with a competitive offer," said Bartleman, adding that the company may eventually launch a cryptocurrency product for retail investors without commissions.
Webull, another no-fee, online trading platform, makes money from loan products, such as margin loans to customers who want to borrow money to buy more stock, according to CEO Anthony Denier. Webull also issues debt securities to short sellers who sell debt securities in the hope of returning the stock at a lower price. Webull also generates a fee for routing orders on the exchange.
"Now that the playing field is level, we have to go back to what broker-dealers need to do: offer a better platform and customer experience. Consumers have so much more power these days," said Denier.
Brokers act more like banks?
Industry members have stated that all brokers should start offering more services if they want to remain competitive.
"For every broker sold there, trying to sell services with explicit commissions will be almost impossible. The next frontier will focus on providing more financial well-being solutions – extending beyond mere brokerage," Bill Capuzzi said. CEO of Apex Clearing, a custodian firm that deals with securities for brokerage firms.
Capuzzi stated that brokerages might look like taking more deposits and offering loans for debt consolidation, for example. "Investment and lending," he said.
Capuzzi added that the unintended consequence of the growing number of brokers offering zero commission trading accounts is that they can meet higher minimum account balances and cash requirements and reduce the number of ETFs and mutual fund options to offset the hit to offset the hit. income.
One of the leading online brokers that has yet to reduce commissions to zero is the giant Fidelity. The company advertises how it offers higher returns to customers, automatically adding their cash surplus to more profitable money market accounts – a service known as cash exploration.
"Interestingly, Schwab, TD Ameritrade and E-Trade deliberately chose not to help the largest number of their investors by automatically providing the highest interest rate for their cash, as Fidelity does," the company told CNN Business.
So, although the race to zero is now In large part, the war with Internet brokerage may have just begun.