Fidelity to impose $100 fee on ETFs from nine firms (2024)

FAQs

Fidelity to impose $100 fee on ETFs from nine firms? ›

Fidelity warned a group of nine issuers in April that if those firms didn't negotiate or agree on a deal, their investors would have to pay up to $100 per ETF purchase on the Fidelity platform. Those fees would have been effective on June 3.

Investors will have to pay a $100 servicing charge when they purchase an ETF from one of the nine providers. The fee will cover the costs of listing the included firms' ETFs on Fidelity's platform. The new fee was first reported by Bloomberg News.

Fidelity doesn't charge a fee for sending or receiving EFTs, but the receiving bank may charge a fee. Fidelity also doesn't charge fees to process wire transfers to a bank or other recipient.

Boston-based Fidelity, which has more than $1 trillion worth of ETF assets on its platform, is aiming to charge investors $100 for buying ETFs from issuers who refuse to pay an annual fee equal to 15% of fund expense ratios, a spokesperson confirmed. The spokesperson declined to comment otherwise.

Fidelity Investments plans to charge investors a $100 service fee on exchange-traded funds purchased from nine firms that don't have maintenance arrangements with the financial services giant, a spokesman confirmed.

All but nine ETF issuers have agreed to absorb the $100 transaction fee. Fidelity Investments is introducing a $100 surcharge for buying non-Fidelity ETFs on its platform and the majority of ETF issuers have agreed to absorb the cost.

Free commission offer applies to online purchase of ETFs in a Fidelity retail account. The sale of ETFs is subject to an activity assessment fee (from $0.01 to $0.03 per $1,000 of principal). ETFs are subject to market fluctuation and the risks of their underlying investments.

Free commission offer applies to online purchases of select iShares ETFs in a Fidelity brokerage account.

Vanguard and Fidelity charge $0 commissions for online equity, options, and ETF trades for U.S.-based customers. Fidelity has a $0.65 per contract option fee; it's $1 at Vanguard. Fidelity will set you back more for broker-assisted stock trades ($32.95 versus Vanguard's $25.

Escaping the Fidelity Recordkeeping Fee can be achieved through strategic actions such as closing the account, seeking fiduciary services, and considering alternatives to minimize financial obligations. Closing the account is a straightforward approach to avoid the fee entirely.

Are Fidelity ETFs worth it? ›

Bottom line. These Fidelity ETFs all have attractive long-term returns and charge low expense ratios, making them a good fit for many investors. But you'll want to research them further and compare them with other funds – such as the best small-cap ETFs – to see if they work best for your needs.

A good rule of thumb is to not invest in any fund with an expense ratio higher than 1% since many ETFs have expense ratios that are much lower. Also, ETFs tend to be passively managed, which keeps the management fee low.

Brokerage, STT, and Other Charges

The average brokerage charge on purchasing ETFs is 0.01% of the turnover value. There are certain charges that the SEBI levies on the purchase of stocks from an exchange. Since ETFs also trade like stocks and are listed on the exchange, ETFs attract such charges from SEBI.

But even if you put all of your cash in its completely free funds, Fidelity can likely shave off a few dollars a year in revenue by lending out the stock the funds hold to short-sellers.

Fidelity^® Wealth Management is available through Fidelity Wealth Services and/or Fidelity Strategic Disciplines. Both are advisory services offered for a fee.

Gross advisory fee applicable to accounts managed through Fidelity^® Strategic Disciplines ranges from 0.20% to 0.49% and gross advisory fee applicable to accounts managed through Fidelity^® Wealth Services ranges from 0.50%–1.04%, in each case based on a minimum investment of $2 million.

ETFs don't often have large fees that are associated with some mutual funds. But because ETFs are traded like stocks, you may pay a commission to buy and sell them, although there are commission-free ETFs in the market. To be fair, mutual funds do offer a low cost alternative: the no-load fund.

ETF fees are operational expenses that are deducted from the fund assets. Therefore, investors do not pay fees directly to a fund manager. Since ETFs are traded on an exchange like stocks, they may also be subject to brokerage fees, which are commissions that are typically not more than $20 per trade.