Stocks

[Ephraimh]

Zecco had free trades in 2006.

You are not comparing it to the disruptive waive Robinhood made, are you

[Ephraimh]

It can't and isn't being done for free by anyone. Now figure out how you are paying them.

At this point they’re not being paid, nothing to figure out, they’re sacrificing revenue in the name of asset/users accumulation.

[yos9694]

At this point they’re not being paid, nothing to figure out, they’re sacrificing revenue in the name of asset/users accumulation.

It's not a secret that they've been selling order books to HFT for years. Selling order book feeds is much more lucrative than commissions, so it was a no brainer to zero out commissions instead of losing out on trades.

It was not so long ago that online trades were disruptive. Charging a mere $20 per trade was a bargain compared to broker assisted over the phone. Times change, but change never changes.

[ExGingi]

https://www.bloomberg.com/news/articles/2019-11-21/charles-schwab-in-talks-to-buy-td-ameritrade-cnbc

Wow

Officially announced (subject to the usual stuff) on this Mega Merger Monday.

Who's next? A tie-up between IB an E*Trade? A takeover of one or both of those by Fidelity?

[ExGingi]

Officially announced (subject to the usual stuff) on this Mega Merger Monday.

Who's next? A tie-up between IB an E*Trade? A takeover of one or both of those by Fidelity?

https://www.bloomberg.com/opinion/articles/2019-11-25/schwab-got-a-discount-on-a-brokerage

Interesting analysis. I don't think the others can have such advantages. IINM Fidelity and E*Trade have bank subsidiaries (or some other kind of arrangement, as they do have some kind of banking operations).

[dealfinder11]

https://www.cnn.com/2019/12/13/investing/robinhood-free-trading-fractional-shares/index.html
Significant part of this story is Robinhood plans on making fractional shares in ETFs available as well. Would totally eliminate a need for a mutual fund. Schwab said they were only planning on making regular stocks available [in fractional shares], not ETFs.

[dealfinder11]

Wow . IB jumping in on fractional shares as well. Looks like we are accelerating into a new era of investing.

https://www.interactivebrokers.com/en/general/communiques/2019/2019-Q4-vol9.html#section-feature-drop

[ExGingi]

Wow . IB jumping in on fractional shares as well. Looks like we are accelerating into a new era of investing.

https://www.interactivebrokers.com/en/general/communiques/2019/2019-Q4-vol9.html#section-feature-drop

Indeed a new era.

What's next? 24-hour trading, making it almost like the currency markets?

[Zevwolf]

https://www.cnbc.com/2020/01/02/low-fee-pioneer-vanguard-finally-joins-the-crowd-by-dropping-stock-commissions-to-zero.html

[ltttc]

Do public companies have restrictions on how they can distribute their profits? (i.e. Can they give themselves raises as they see fit or does all profit have to be divided among shareholders in dividends or capital gains??)

[yuneeq]

Do public companies have restrictions on how they can distribute their profits? (i.e. Can they give themselves raises as they see fit or does all profit have to be divided among shareholders in dividends or capital gains??)

The board members have a fiduciary duty to do whatever is best for the shareholders.

[ltttc]

Does that include ALL profits?  What I mean is, let's say a company goes public, does it "sell all of itself to the public" or only a %? If it's only say 40% are ALL profits "restricted"?

[yuneeq]

Does that include ALL profits?  What I mean is, let's say a company goes public, does it "sell all of itself to the public" or only a %? If it's only say 40% are ALL profits "restricted"?

Does not matter what the percentage is that they offer in the IPO, they always have a fiduciary duty to the shareholders.

[ltttc]

Does not matter what the percentage is that they offer in the IPO, they always have a fiduciary duty to the shareholders.

So even if they keep 60% for themselves the BOD will have the final word as to what they can do with ALL the profits? (TIA - we're debating a topic here with some colleagues, so just need some accurate info)

[Ephcc90]

So even if they keep 60% for themselves the BOD will have the final word as to what they can do with ALL the profits? (TIA - we're debating a topic here with some colleagues, so just need some accurate info)

Yes, generally, the BoD & management has the final say on all distributions (and all transactions except those required by law to be put to a shareholder vote). However, a “self-dealing” transaction can be challenged in court for a breach of their fiduciary duty by shareholders (though the law is generally very deferential to the BoD/management).