Fidelity adds 5% transaction fee on many ETFs, ending commission‑free trading

Effective June 1, 2026, Fidelity Investments began charging a transaction fee of 5% of the trade value, capped at $100, on purchases of a large group of exchange‑traded funds (ETFs) that are not part of its revenue‑sharing program. The fee replaces the commission‑free model that was introduced in 2019 when Charles Schwab and other brokers eliminated trading commissions for retail investors. Fidelity says the change is needed because brokerages have lost revenue from the zero‑commission era, and ETFs that refuse to pay a revenue‑sharing fee are now passed on to end investors.

The new charge affects ETFs such as the Roundhill Memory ETF (DRAM), which had become the fastest‑growing U.S. ETF after amassing roughly $25 billion in assets since its April 2026 launch. The broader ETF market now includes more than 5,500 U.S.-listed funds, intensifying competition and prompting brokers to reassess pricing structures. Investors purchasing affected ETFs will see the fee deducted at the point of trade, potentially reducing returns.

The shift marks a notable reversal of the commission‑free trading era that helped fuel rapid ETF growth, signaling that brokerage firms are seeking new revenue streams as the market becomes increasingly crowded.