Firm extends commitment to investors, but urges them to look at ‘total cost picture’
In line with a broader movement toward zero-commission trading in the U.S., Vanguard has extended its commission-free online trading platform for U.S. customers.
Effective immediately, Vanguard Brokerage extended commission-free online trading for stocks and options to all its clients. The latest move builds on a commission-free offer that has stood since 1977 for all Vanguard mutual funds, since 2010 for all Vanguard ETFs, and nearly every ETF in the U.S. industry since 2018.
“For 45 years, we've been dedicated to lowering the cost of index and active funds, ETFs, advice, and brokerage services to help investors achieve better outcomes,” Karin Risi, Managing Director of Vanguard's Retail Investor Group, said in a statement. “The expansion of our commission-free platform marks the latest demonstration of this unwavering commitment to our clients.”
With the broader commission-free platform, Vanguard said its brokerage clients will benefit from lower costs on stock purchases and other strategies such as rebalancing, dollar-cost averaging, and tax-loss harvesting. However, it also reminded investors to consider the all-in cost of their brokerage relationships, which should include fees, expenses, and opportunity costs.
Aside from zero minimums and zero account fees for clients who set up electronic delivery of statements and other materials, the firm made note of its simple fee schedule, including US$1 per US$1,000 face amount bond trade and US$1 per options contract. It added that instead of accepting payment for client stock trading and ETF orders, it focuses on receiving the best possible price for clients’ trades.
“[A]s we move to an environment in which 'zeros' dominate the headlines and explicit fees become implicit, we encourage investors to look more deeply at the total cost picture,” Risi said. “Vanguard remains a vocal proponent of clear and transparent fee disclosure.”
