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In a $0 Fee World, Charles Schwab Muscles Its Way to the Top

  • Schwab sent shockwaves by eliminating fees. Then, it pounced
  • A $26 billion tie-up will reshape discount-brokerage industry
Charles Schwab Corp. Office As New Accounts Rise Most In 18 Years
Photographer: Christopher Lee/Bloomberg

For decades, Charles Schwab Corp. quietly plotted to unleash its ultimate weapon against rivals: $0 fees.

Schwab considered eliminating charges in the 1990s after the advent of online trading, and again in the 2000s during the financial crisis, according to a person with knowledge of the matter. Each time, it dismissed the idea as too risky -- a danger to its own bottom line.