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How does TD Easy Trade make money with commission-free trading? Is it solely through USD currency exchange fees like Wealthsimple? Is TD using the platform as a loss leader for their Direct Investing platform? Do they expect customers will make more than 50 free trades per year and thus will need to pay commissions after that?

Unlike a platform such as Wealthsimple which has a multitude of articles on the internet detailing how they make money without commissions, I couldn't find any information about how TD Easy Trade makes money through commission-free trading (likely because it is a new platform).

This question is similar to this previous question, but asking about TD Easy Trade instead of Robinhood.

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  • Some platforms generate revenue from free trades by accepting payment for order flow. I have no idea if TD is one of them (hence why this is a comment).
    – Brian
    Mar 8, 2022 at 14:29

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Fidelity, Schwab, TD, Vanguard, etc. make billions of dollars per year from investors. Depending on what they offer, they might make money from:

  • Net interest income

  • Margin interest

  • Borrow fees from shorters

  • Mutual fund and ETF service fees

  • Advice solutions

  • Managed money

  • Sale of annuities

The largest source of revenue is generally “net interest income” which is earned by investing deposits and customer deposits (uninvested cash) sitting in an account earning minimal interest and investing it at a higher interest rate.

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