Charles Schwab, chairman of Charles Schwab Corp., speaks in Chicago, Illinois, on Wednesday, Nov. 20, 2013.
Daniel Acker | Bloomberg | Getty Images
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Charles Schwab said the discount broker’s latest move to zero commissions was a long-time goal to deliver to investors.
“It was sort of the final solution for investors,” chairman and founder of Charles Schwab told CNBC’s Bob Pisani on the “Halftime Report” on Monday. “We have a great deal for investors. You can buy and sell stocks for no commission.”
As of Monday, the brokerage firm is no longer charging commission fees for U.S. stocks, ETFs and options trades. Last week, Schwab announced it would be slashing its trading commission costs from the previous $4.95 to zero. Brokerage rivals E-Trade, Interactive Brokers and TD Ameritrade all dropped their commission fees in the last two weeks in the latest move in the brokerage fee wars.
“We joined the New York Exchange in 1981 many years ago and so prices then, when we first came on board, we were about half price. We kept coming down every year to now,” Schwab added.
The company, with a market value of about $54.7 billion, is hoping the lost fee revenue will be made up for in other parts of the business, like fixed income.
“We make our money on other relationships, you might want advice, you might want fixed income or things like that, we’ll make a little bit of money there. But commissions on stocks are now free,” said Schwab.
“What we try to do is offer things that customers really want, and they definitely want lower prices. So we’ve been a company that’s been involved with that by using technology for many, many years,” Schwab added.
The firm’s founder said consolidation in the retail brokerage industry is a “logical conclusion that will occur.”
Schwab retired as CEO in 2008, but remains chairman and is the largest shareholder.