Most ETFs carry a fixed basket of securities and are typically created to match an index, or particular category of stocks, allowing investors to access a portfolio of equities focused on a broad or narrow cross-section of stocks.

Some investors may be asking how low commissions can go. Free is about as low as it gets. Maybe big financial-services companies will ultimately do away with commissions and charge only a small annual fee, recognizing the value of assets held in their accounts. Or maybe this price war will result in a draw -- much as airlines realize they can only cut fares so much without becoming unprofitable.

For retail traders, this promises to be an interesting opportunity to either day trade or build a balanced portfolio at a low cost.
Terry Savage is an expert on personal finance and also appears as a commentator on national television on issues related to investing and the financial markets. Savage's personal finance column in the Chicago Sun-Times is nationally syndicated. She was the first woman trader on the Chicago Board Options Exchange and is a registered investment adviser for stocks and futures. Savage currently serves as a director of the Chicago Mercantile Exchange Corp.

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