(Bloomberg) -- It was a tough day for the billionaire founders of the biggest online brokerages.
Shares of Interactive Brokers Group Inc. and TD Ameritrade Holding Corp. tumbled Tuesday after Charles Schwab Corp. said it planned to eliminate commissions for U.S. stocks, exchange-traded funds and options.
Thomas Peterffy, chairman of Interactive Brokers, saw his fortune decline by about $1.6 billion after the firm’s shares slid 9.4% in New York trading. Charles Schwab’s net worth dropped about $557 million as his company’s stock fell almost 10% on the news. TD Ameritrade was the biggest decliner, plunging 26% and shaving about $604 million from founder Joe Ricketts’ net worth.
Read more: Schwab triggers online-broker bloodbath as price war escalates
Schwab’s announcement heats up a price war among the brokerages as investors gravitate toward the cheapest products, with Interactive Brokers announcing just last week that it would provide free trades. Since the middle of last year, firms including Fidelity Investments, Vanguard Group and JPMorgan Chase & Co. have eliminated fees and commissions on a range of offerings.
Kalen Holliday, a spokeswoman for Interactive Brokers, declined to comment, while representatives for Schwab and TD Ameritrade didn’t respond to requests for comment.
(Updates net worth, share declines in third paragraph.)
--With assistance from Annie Massa, John Gittelsohn, Tom Maloney and Jack Witzig.
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