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Schwab (SCHW) Cuts Fees on More Fixed income ETFs to 0.03%
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In an effort to attract investors, Charles Schwab’s (SCHW - Free Report) asset management arm, Schwab Asset Management, has reduced fees on the Schwab High Yield Bond ETF (“SCYB”) and the Schwab U.S. TIPS ETF (“SCHP”) to just three basis points.
With this move, the fees for Schwab Asset Management’s entire lineup of fixed income ETFs comes to the same level.
Nicohl Bogan, the director of product strategy and development at Schwab Asset Management, said, “At Schwab Asset Management we are proud to continue our legacy of driving cost savings for investors with a focus on what is most meaningful to our clients. Fixed income has been in the spotlight for investors in a higher interest rate environment. We have seized the opportunity to expand our fixed income offerings, recently launching high yield and municipal bond ETFs, while also helping investors save on fees.”
Since investors consider the expense ratio as one of the most important factors before owning an ETF, such low fees are expected to attract more clients for SCHW.
Thus, despite the lower price on each ETF product, Schwab will likely be able to remain profitable in terms of its ETF business with the increase in volume.
Amid the uncertain market conditions, Schwab has remained focused on enhancing its trading revenues by undertaking several initiatives aimed at building client base. The company has already lowered its basic online equity and ETF trade commissions to zero.
Also, it launched Schwab Stock Slices, through which investors are able to own shares of any company in the S&P 500 Index starting at $5 each, even though these shares cost more.
Over the past year, shares of SCHW have lost 22.7% against the industry’s rise of 1.7%.
Over the past 30 days, the Zacks Consensus Estimate for Morgan Stanley’s current-year earnings has been unchanged. Over the past year, the MS stock has gained 4.5%.
Earnings estimates for IBKR have been revised marginally lower for the current year over the past 30 days. Over the past year, IBKR’s shares have rallied 38%.
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Schwab (SCHW) Cuts Fees on More Fixed income ETFs to 0.03%
In an effort to attract investors, Charles Schwab’s (SCHW - Free Report) asset management arm, Schwab Asset Management, has reduced fees on the Schwab High Yield Bond ETF (“SCYB”) and the Schwab U.S. TIPS ETF (“SCHP”) to just three basis points.
With this move, the fees for Schwab Asset Management’s entire lineup of fixed income ETFs comes to the same level.
Nicohl Bogan, the director of product strategy and development at Schwab Asset Management, said, “At Schwab Asset Management we are proud to continue our legacy of driving cost savings for investors with a focus on what is most meaningful to our clients. Fixed income has been in the spotlight for investors in a higher interest rate environment. We have seized the opportunity to expand our fixed income offerings, recently launching high yield and municipal bond ETFs, while also helping investors save on fees.”
Since investors consider the expense ratio as one of the most important factors before owning an ETF, such low fees are expected to attract more clients for SCHW.
Thus, despite the lower price on each ETF product, Schwab will likely be able to remain profitable in terms of its ETF business with the increase in volume.
Amid the uncertain market conditions, Schwab has remained focused on enhancing its trading revenues by undertaking several initiatives aimed at building client base. The company has already lowered its basic online equity and ETF trade commissions to zero.
Also, it launched Schwab Stock Slices, through which investors are able to own shares of any company in the S&P 500 Index starting at $5 each, even though these shares cost more.
Over the past year, shares of SCHW have lost 22.7% against the industry’s rise of 1.7%.
Image Source: Zacks Investment Research
Currently, Schwab carries a Zacks Rank #3 (Hold).
A couple of better-ranked stocks from the same space are Morgan Stanley (MS - Free Report) and Interactive Brokers (IBKR - Free Report) . MS and IBKR currently carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Over the past 30 days, the Zacks Consensus Estimate for Morgan Stanley’s current-year earnings has been unchanged. Over the past year, the MS stock has gained 4.5%.
Earnings estimates for IBKR have been revised marginally lower for the current year over the past 30 days. Over the past year, IBKR’s shares have rallied 38%.