Charles Schwab is ending commissions on stock trading and the brokerage shares are tanking

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Charles Schwab said on Tuesday that it is ending commissions for online trading in U.S. stocks, exchange-traded funds and options.

Shares of Schwab fell 5% in premarket trading Tuesday.

Rival brokerage firms TD Ameritrade and ETrade shares dropped more than 10% in premarket trading. 

Starting on October 7, Schwab will be slashing its trading commission cost for U.S. stocks and ETFs from the previous $4.95 to zero. Trading options will continue to cost 65 cents per contract.

The changes will apply to securities on Canadian exchanges as well.

The firm’s “passion has been to make investing easier and more affordable for everyone,” founder and chairman Charles Schawb said in a press release. 

The announcement comes after Interactive Brokers took the same step towards commission free trades on Thursday.

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