Fidelity Lowers Fees in Wake of Schwab Cuts

Fidelity Investments, the biggest U.S. mutual fund company, will cut commissions next month on stock and options trades by 42% for its most active brokerage customers after Charles Schwab Corp. made a similar change.

The new commission rate of $8 a trade, down from $14, applies to Fidelity’s “gold level” customers who make at least 120 stock, bond or options trades a year and have $30,000 in household assets at the Boston-based company. Customers who make fewer trades and have $1 million in assets at Fidelity also qualify, down from the 240 trades a year or $2 million previously required.

“This is a sweet spot in the marketplace,” Jeff Carney, president of the Fidelity Personal Investments division, said. “We’d like to be the No. 1 player” among active traders, he said.

Fidelity is the No. 5 U.S. online brokerage as measured by daily average trading, with a 9% share of the market, according to Friedman, Billings, Ramsey & Co. in Arlington, Va.

San Francisco-based Schwab, the biggest U.S. discount broker, said earlier this month that it would allow traders who make at least 30 trades a quarter to qualify for $14.95 commissions, down from the 60 trades a quarter previously required.