December 2018 – Annual Brokerage Fees Review

​This report is Broker Monitor’s annual review of account and service fees charged by the discount and full-service brokerage firms in our coverage group. Fee cost and transparency are increasingly important points of differentiation for firms and top-of-mind for investors. In Corporate Insight’s 2017 Investor survey we asked 1,500 respondents what changes, if any, could their primary brokerage firm make to improve their satisfaction. Twenty-nine percent of all respondents selected “lower commissions and fees” and 15% chose “simpler, more transparent fees and pricing,” the second and third most popular responses, respectively. Notably, investors’ desire for greater fee transparency increased by 6% compared with our 2016 survey findings. The rise of low-cost startups like Betterment and Robinhood, which build their branding and marketing around the relatively high cost of working with incumbent firms, could in part explain investors’ focus on fees. The seemingly perpetual industry publication headlines focusing on the deleterious impact that fees have on long-term investment returns also surely contributes to investors’ perceptions around cost.

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