Charles Schwab Expands Menu Of Commission-Free ETFs

By Mani
Updated on

Charles Schwab announced on Tuesday that it is adding JPMorgan Asset Management and nine new ETFs to Schwab ETF OneSource, thereby enabling investors to buy and sell 211 ETFs covering 66 Morningstar categories with $0 online commissions. The latest additions will broaden access to $0 commission Strategic Beta and Currency-Hedged ETFs.

JPMorgan becomes 14th provider to join Charles Schwab

Starting today, all three of JPMorgan Asset Management’s diversified return strategic beta ETFs will be available to Charles Schwab clients with $0 online trade commission. JPMorgan thus becomes the 14th provider to be added to the Schwab ETF OneSource program, joining ALPS, Direxion Investments, ETF Securities, Global X Funds, Guggenheim Investments, IndexIQ, PIMCO, PowerShares, ProShares, State Street SPDR ETFs, United States Commodity Funds, WisdomTree, Charles Schwab Investment Management.

WisdomTree, an ETF and exchange-traded product sponsor and asset manager, also announced Tuesday that starting today, it will add four additional currency-hedged WisdomTree  ETFs to Schwab ETF OneSource, which offers investors and advisers the most commission-free ETFs in the industry. Following the latest addition, Schwab clients can buy and sell 14 WisdomTree ETFs, and purchases are subject to $0 online trade commission and no early redemption fees or hidden costs. Besides WisdomTree, ETF Securities is adding a diversified-factor ETF, and Direxion Investments is adding a strategic beta high-dividend ETF.

As reported by ValueWalk, last April, Charles Schwab unveiled a feature known as the Schwab Intelligent Portfolio, which is the brokerage’s proprietary answer to robo-banking and advising. The brokerage’s proprietary, low-cost ETFs are also very popular among investors. Schwab’s ETFs are likely to get a boost from the SIP push, which in turn, helps Charles Schwab gain even more.

Scramble to add more ETFs

Brokerages have been scrambling to add more ETFs with $0 trading commission in order to capture investors. The latest additions give investors more choice within two highly sought-after categories in investing today: currency-hedged ETFs and strategic beta funds across both U.S. and international markets. The complete list of Schwab ETF OneSource ETFs can be accessed here.

As outlined by ValueWalk, analysts at RBC Capital Markets estimate that the robo-adviser industry could eventually be a $500 billion market. Schwab can offer no-cost robo-advisers because it will be able to manage the cash in client accounts, generating interest income directing at least part of those investments to its own mutual funds and ETFs, and capturing future revenue from customers who decide they are willing to pay for advice later on in life when they have higher income.

Leave a Comment