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A New Combatant In The Online Brokerage Price Wars: Overstock To Offer $1.99 Trades

A New Combatant In The Online Brokerage Price Wars: Overstock To Offer $1.99 Trades
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Stock trading is cheaper than it’s ever been before thanks to an all-out price war among online brokers. This week, Inc (NASDAQ: OSTK) and Siebert Financial Corp. (NASDAQ: SIEB) announced a plan to take that battle to the next level.

The two companies signed a letter of intent to offer deeply discounted trading for any U.S. traders who use the Muriel Siebert & Co. portal on Overstock’s site. Overstock plans to offer $2.99 stock trades to all users and a special $1.99 commission for its Club O loyalty members.

Overstock said it expects the new service to launch in the first quarter of 2018.

“New customers subscribing to the discount brokerage suite of products would be offered best-in-class services including Smart Order and Routing and Execution services by tZERO’s broker-dealer Speedroute, a FINRA firm, and Clearing Services through StockCross Financial Services, a FINRA firm and affiliate of Siebert Financial Corp,” the company said in a statement.

Price Wars

Online brokers have been slashing trading commissions left and right in 2017. In March, E*TRADE Financial Corp (NASDAQ: ETFC) dropped its standard trading commissions from $9.99 to $6.95. Also this year, Charles Schwab Corp (NYSE: SCHW) cut its commission from $8.95 to $6.95 and then again to $4.95. Fidelity cut its standard commission to $4.95, and TD Ameritrade Holding Corp. (NASDAQ: AMTD) cut its commission from $9.99 to $6.95.

Investors certainly seem excited about the opportunity that discount trading could bring to Siebert. The stock is up 120 percent in the past two days.

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