UK stockbroker AJ Bell takes on fintech rivals with commission-free investing app

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  • British online stockbroker AJ Bell plans to launch a new app called Doddle which offers commission free investments.
  • The move would make AJ Bell competing with a wave of fintechs offering similar services, including Revolut and Freetrade.
  • In the US, Robinhood’s growing popularity forced many brokerage firms to reduce their commission rates to zero.

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LONDON – The race for the bottom of Wall Street’s stock brokerage fees is coming to the UK

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British online stockbroker AJ Bell on Monday said it plans to launch a new app that offers commission-free investing in the first half of 2022.

The move would see AJ Bell competing with a wave of fintechs offering similar services, including Revolut, Freetrade and eToro. It could also pressure rival firms Hargreaves Lansdowne and Interactive Investor to follow suit.

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AJ Bell’s app, called Doddle, will let users buy and sell a range of popular stocks listed in the UK. US shares won’t be available initially, but the firm said it plans to add them soon after the app is rolled out.

The company will also offer multi-asset funds with six different risk levels, as well as a range of “themed” funds focusing on areas such as technology, healthcare and responsible investing.

Customers will be able to open an individual savings account, a lifetime ISA and a general investment account. Users will be guided by “friendly monsters” who will advise them on investment decisions.

The company will charge an annual fee of 0.15%, but no commission fee or tax cover fee. Users making purchases in the fund must pay an annual cost for the underlying fund.

Andy Bell, Chief Executive Officer of AJ Bell, said, “Doddle by AJ Bell is perfect for anyone looking for a low-cost, easy-to-use investment app to help them achieve their investment goals such as a house deposit, saving for vacations or retirement. So to receive.” a statement.

“The seamless investing journey and streamlined investment range will especially appeal to those who are new to investing and want an easy way to manage their investments.”

Shares of AJ Bell rose more than 1% on Monday amid a broader rally in European equity markets.

AJ Bell’s foray into zero-commission trading comes in response to a flood of fintech upstarts in the wealth management world, which have made it easier for everyday investors to access the stock market.

Silicon Valley firm Robinhood pioneered the trend in the U.S. The growing popularity of the investment platform saw several other brokerage firms follow suit, reducing their commission rates to zero.

In the UK, several online trading firms have emerged offering clients cheaper stock trading and features aimed at improving financial education, including Revolut, Freetrade and eToro.

While apps like Robinhood have helped open up the investing experience to the masses, some experts fear that people are taking trading like a game.

Robinhood found itself at the center of a wild trading frenzy earlier this year, with amateur investors watching the share prices of other firms like Gamestop and AMC draw inspiration from a popular Reddit community.

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