JPMorgan To Offer Free Trading for Bank Customers
August 21 2018 - 12:09PM
Dow Jones News
By Emily Glazer
JPMorgan Chase & Co. is throwing a wrench in the digital
investing field.
The largest U.S. bank by assets is planning to launch a new
investing service next week that offers free or discounted
trades.
Any bank customer can get at least 100 free stock or
exchange-traded fund trades for one year, with no account minimums,
said bank spokesman Darin Oduyoye.
Shares of online brokers fell in response to JPMorgan's
announcement, with TD Ameritrade Holding Corp. dropping more than
than 5%.
The digital investing service, which JPMorgan hinted at during a
February presentation to investors, amplifies price crunching
across the investing industry and could dig into competitors.
Rivals like Charles Schwab Corp. and TD Ameritrade have been
cutting trading fees in an aggressive bid to attract more
customers, and some financial technology startups are already
offering no-fee trades.
Charles Schwab charges $4.95 per trade, and TD Ameritrade and
E*Trade Financial Corp. both charge $6.95 per trade, according to
their websites.
JPMorgan's digital investing service is geared toward first-time
investors, like millennials, or JPMorgan customers who invest
elsewhere. In February, finance chief Marianne Lake said less than
10% of the retail bank's customers have investments with JPMorgan,
and said a two-year-old $300 million investment into digital
capabilities "will accelerate our ability to capture more of their
investments."
The free trades are still a sea change for the bank, which
charged $24.95 for online trades as recently as last year,
according to CNBC, which reported the news earlier.
Certain wealthier bank customers are eligible for unlimited free
trading, Mr. Oduyoye added. JPMorgan's anticipated launch, dubbed
You Invest Trade, will be embedded in the bank's app and
website.
It has been in the works for some time. At a June 2016 investor
presentation, CEO James Dimon said he was considering no-cost
brokerage trades or a free automated investing program.
And at JPMorgan's annual investor day presentation this year,
Ms. Lake said the bank offers an online trading service to wealth
management clients and would launch with other customers this
summer.
"Through this, clients can open an account, trade securities at
competitive rates, build their own portfolios, and move money
seamlessly between banking and investing," she said in February.
She added that the percent of trades placed online has doubled to
55% since April of last year since the bank launched for wealth
management customers.
Write to Emily Glazer at emily.glazer@wsj.com
(END) Dow Jones Newswires
August 21, 2018 11:54 ET (15:54 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
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