AJ Bell woos young investors with no-commission trading app
The online broker AJ Bell is attempting to entice a new generation of traders into the stock market with a commission-free service similar to Robinhood, the American smartphone app that played a major role in the "meme stocks" frenzy.
The move comes after a wave of young investors flocked to share trading during the pandemic on cut-price trading apps such as Robinhood.
The surge culminated in the GameStop saga in January that pushed shares in the struggling US video games retailer to almost $500, up from just $4 the previous year.
AJ Bell said its new “Dodl” app will allow investors to buy a range of stocks and funds on their phones as it takes on low-cost investment platforms such as Freetrade and seeks to attract first-time traders.
Dodl will also offer “themed investments”, including funds focusing on areas such as technology, robotics, healthcare and ethical investing, the FTSE 250 company said.
Andy Bell, founder and chief executive, said: “Dodl by AJ Bell is for anyone looking for a low-cost, easy-to-use investment app to help them meet their investment goals such as saving for a house deposit, holidays or retirement.
“The intuitive investment journey and streamlined investment range will appeal particularly to those that are new to investing and want a simple way to manage their investments.”
Dodl, which will launch in the first half of next year, will initially only offer a selection of UK stocks and funds. Shares in foreign companies will follow once the app is up and running.
Investors will also be offered ISAs through the app, and will be able to consolidate existing ISAs and pensions onto the platform.
In an effort to compete with low-cost investment platforms such as Freetrade, Dodl will charge users an annual fee of 0.15pc of the value of a portfolio, while there will be no commission for buying and selling investments.
Robinhood, which made a $32bn (£24bn) market debut in New York earlier this year, pioneered commission-free trading and was the driving force behind the “meme stocks” frenzy that rocked markets last winter.
The US-based startup scrapped plans to launch in Britain last year but companies such as Freetrade, which now has £1bn in assets under management, have succeeded in adopting some of Robinhood’s tactics.
Shares in AJ Bell rose 1.5pc to 403p, valuing the company at just under £1.7bn.
