AMTD TD Ameritrade Holding Corporation

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)

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