commissionfree

Commissionfree, or zero-commission trading, refers to a trading arrangement in which brokers do not charge a per-trade fee for executing buy and sell orders in securities such as stocks and exchange-traded funds. The term commonly applies to online brokerage platforms that offer stock and ETF trades without a fixed commission, though other charges may apply for certain services, data, or account features.

Origins and adoption: The model gained prominence in the 2010s as fintech platforms disrupted traditional brokerage business models. In the United States, major online brokers began removing stock and ETF commissions in 2019, with firms such as Charles Schwab, TD Ameritrade, E*TRADE, and later Fidelity, as well as numerous fintech startups, offering zero-commission trades. While stock trades can be free, some platforms still charge for options, broker-assisted trades, or non-stock assets, and they may earn revenue through payments for order flow, interest on cash balances, or premium services.

Business model and concerns: Zero-commission does not eliminate all costs. Payment for order flow, routing choices, and other revenue streams can influence a broker's incentives and impact price improvement. Regulators require disclosures on order routing and best execution. Critics argue that the model may create conflicts of interest or reduce price competition for complex orders.

Global landscape and practical considerations: Many markets outside the United States also offer zero-commission stock trading, though fee structures vary by jurisdiction. For investors, commission-free trading lowers barriers to entry and can suit long-term, passive strategies, but users should consider associated costs such as data fees, account maintenance, mutual fund expense ratios, and any spreads embedded in trades.