Earlier this month, Charles Schwab reduced the cost of trading stocks and ETFs to the lowest possible level: $0.
Since their founding, Schwab has been disrupting the industry by taking advantage of the semiconductor to reduce the cost of investing for everyone. This is a good thing. Independently, Schwab and Vanguard changed the industry more than any other two companies, and average investors are better for it.
No longer is it the norm for brokers to charge 1% (or more) of a transaction amount just to trade a stock. No longer is it standard for a mutual fund manager to charge in excess of 1% (or more) annually to attempt to beat the market, which they rarely do anyway.
Research and technology made things better, as did market competition.Continue reading “Cheap is good. Free might not be better.”