ETrade hints at commission cuts on social media

Brokerage responds to Twitter calls for fee cuts with promises of 'more details coming soon'

Oct 2, 2019 @ 11:12 am

By Jeff Benjamin

In the wake of Tuesday's news that both Charles Schwab Corp. and TD Ameritrade Holding Corp. are eliminating brokerage commissions for U.S. stocks, ETFs and options, ETrade Financial Corp. has become a target of inquiry on social media.

Viewed by some analysts as the brokerage that's likely to cut commissions next, ETrade declined to comment for stories on Tuesday. But on Wednesday morning, it was responding to Twitter posts with tweets that suggest something is in the works.

In response to a tweet reading, "Free trades or I'm dropping ETrade," the ETrade Twitter account posted, "We'll have more details on this soon! Thank you for your patience."

In response to another tweet asking for a press release stating the "ETrade has joined the commission-free club," ETrade responded on Twitter, "No official news yet. Stay tuned, we will have more to share shortly."

And in response to a "We're waiting" GIF, ETrade tweeted, "Hold on to your smartphone! There will be more information soon."

ETrade did not respond to a request for comment for this story.

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On Tuesday, after a representative initially suggested that ETrade would be issuing a statement, the company declined to comment.

ETrade saw its shares fell by nearly 17% Tuesday as one of the major publicly traded brokers swept up by the news Tuesday morning that Schwab was cutting commissions.

TD, which announced its commission cuts Tuesday evening, saw its stock fall by nearly 26%, representing the company's largest single-day percentage drop in 20 years.

Schwab, which is viewed as having a more diversified revenue stream, saw its stock price drop by nearly 10%.

In morning trading Wednesday, with the S&P 500 Index down 1.6%, ETrade was down half a percentage point, while TD and Schwab were both down 1.6%.

Meanwhile, Fidelity Investments, which is also seen as a likely candidate for a sudden fee cut, is taking a more generic approach to social media inquiries.

Fidelity is facing its own barrage of inquiries via Twitter, similar to the social media comments about commission cuts at ETrade.

The main difference between ETrade and Fidelity is that Fidelity is playing it close to the vest and responding to all inquiries on Twitter with the following tweet:

"We are committed to providing an exceptional experience and price is one component. With Fidelity, you receive industry-best order execution & price improvement, no investment mins. and zero expense ratio index funds. We'll continue to enhance our offerings and keep you informed!"

Fidelity did not respond to a request for comment for this story.

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