Jumping on this week's brokerage industry trend, ETrade Financial Corp. has announced plans to eliminate online trading commissions for U.S. stocks, exchange-traded funds and options starting Monday.
Unlike Schwab and TD, ETrade spent nearly 24 hours suggesting on social media that such a move was imminent.
According to CFRA, commissions represent approximately 18% of ETrade's revenues.
The ETrade announcement estimated the "quarterly pro forma revenue impact of the commission changes to be approximately $75 million."
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Schwab, TD and ETrade all saw their stock prices take an initial hit on Tuesday following Schwab's pre-market announcement. On a day that saw the S&P 500 Index decline by 1.2%, Schwab shares fell by nearly 10%, TD shares lost nearly 26% and Etrade shares declined nearly 17%.
Cathy Seifert, CFRA equity analyst, described Tuesday's market reaction as "proportionate to the impact on commission revenues" at each firm.
"Every time commissions get cut there's a similar reaction," she added.
On Wednesday, when the S&P fell more than 1.7%, shares of all three of the companies posted declines between 3.2% and 3.5%.
ETrade did not immediately respond to a request for comment for this story.