Do Zero-Cost Trades Actually Benefit Investors?

– SPECIAL EDITION -Last week in Sagacious, we commented on the recent move by Charles Schwab and TD Ameritrade to cut trading commissions to zero on stocks listed in North America. Our initial thoughts and comments were on the potential for negative externalities, regarding how market structure may be impacted by brokers selling order flow….

The Downsides to Zero-Cost Commission

This week, financial services firm Charles Schwab announced that they would be eliminating trading commissions for stocks, ETFs, and options listed on U.S. or Canadian exchanges for clients using mobile or web applications. Though the press release stated the motive was to lower barriers for investors, it was likely done in response to initiatives from…