Shares of discount broker Charles Schwab (SCHW) are higher by nearly one percent and touched a new 52-week higher earlier today after the company unveiled substantial additions to its commission-free ETF lineup.
Under a new platform known as Schwab ETF OneSource, the California-based brokerage firm will, starting today, allow its clients to buy and sell 105 ETFs with $0 online trade commissions. Schwab has allowed its clients to trade the firm's own ETFs commission-free since the firm first entered the ETF business several years ago.
"Just as Schwab Mutual Fund OneSource changed the landscape for investors and advisors by providing convenient, affordable access to leading mutual funds when Chuck Schwab introduced it twenty years ago, we believe Schwab ETF OneSource will deliver enormous benefit and change the way our clients buy and sell ETFs, said Schwab CEO Walt Bettinger in a statement.
Noteworthy is the fact that Schwab's commission-free lineup includes over 100 ETFs from a variety of issuers including State Street's (STT) State Street Global Advisors, the second-largest U.S. ETF sponsor. Schwab will also offer ETFs issued by Invesco's (IVZ) PowerShares, Guggenheim ETF Securities and United States Commodity Funds as part of the Schwab ETF OneSource platform.
Schwab's new commission-free ETF program also looks to be a shot across the bow at rival brokers such as Fidelity, but the Schwab menu could be what impresses investors. For example, Fidelity does allow its clients to trade select iShares ETFs on a commission-free basis, though that lineup is fairly limited and none of the funds featured can be considered exotic.
TD Ameritrade (AMTD) offers a broader range of commission-free ETFs, indicating that Schwab and TD Ameritrade could see their rivalry intensify as both aim to capture assets from cost-conscious ETF investors.
However, the Schwab ETF OneSource also features more exotic offerings such as the Guggenheim China Small-Cap ETF (HAO) and the SPDR S&P Emerging Latin America ETF (GML). Schwab OneSource's commission-free bond ETF menu is also among the deepest in the industry, including such funds as the PowerShares Senior Loan Portfolio (BKLN) and the SPDR Barclays Capital EM Local Bond ETF (EBND) along more benign offerings such as the Schwab U.S. TIPS ETF (SCHP).
While OneSource's sector offerings do not include any of the popular Select Sector SPDRs, the group does feature nine of Guggenheim's equal-weight sector ETFs such as the Guggenheim S&P Equal Weight Technology (RYT).
OneSource also features a wide array of forex and commodities offerings, something not previously seen on other commission-free platforms. Seven Guggenheim forex ETFs can be traded commission-free on OneSource. Schwab's commission-free commodities offerings now include the U.S. Gasoline Fund (UGA), the ETF Physical Silver Shares (SIVR) and the ETFS Physical Platinum Shares (PPLT).
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