Merrill Lynch expands free trades for majority of online clients

Merrill Lynch expands free trades for majority of online clients
Bank of America does away with limits on free trades for many during industry price war.
OCT 21, 2019
Joining the race to eliminate commissions for online stock trades, Bank of America Corp.'s Merrill Lynch unit is tossing out limits for free trades for certain clients who use online or mobile platforms. The bank on Monday said it was expanding its zero-dollar online trades, offering unlimited and commission-free stock, exchange-traded fund and option trading to clients with a Bank of America checking account and at least $20,000 in cash or securities who are part of its "preferred rewards" program. Prior to this, those customers had a limited number of free trades each month; the minimum was 10 and maximum 100. [Recommended video: Aaron Klein: New tools will help investors trade through the Riskalyze lens] That program currently has about 6 million clients, but another 4 million could immediately qualify, said Aron Levine, head of consumer banking and investments at Bank of America. He said Merrill Lynch started offering zero-dollar trades to certain clients in 2006 and has steadily expanded the program since then. Meanwhile, customers who use the online brokerage platform, Merrill Edge Self-Directed, who are not registered in the preferred rewards program will see prices for online stock, ETF and options trades cut from $6.95 to $2.95 with no minimums. "Eighty-seven percent of trades are free with online and mobile," said Mr. Levine. "More importantly, we've been looking at this for years. It's not a purely investment-focused relationship with the client but one across banking, lending and investing." Charles Schwab Corp. was the first to make the move to erase commissions on certain online trades at he start of this month. It was quickly followed by TD Ameritrade Holding Corp., E*Trade Financial Corp. and Fidelity Investments. Although it may have been widely expected, Schwab's move has clearly shaken up the financial advice industry. Whiles trading has become a commodity for many brokerage firms, commissions from trading are still a significant piece of revenue for some broker-dealers.

Latest News

The 2025 InvestmentNews Awards Excellence Awardees revealed
The 2025 InvestmentNews Awards Excellence Awardees revealed

From outstanding individuals to innovative organizations, find out who made the final shortlist for top honors at the IN awards, now in its second year.

Top RIA Cresset warns of 'inevitable' recession amid tariff uncertainty
Top RIA Cresset warns of 'inevitable' recession amid tariff uncertainty

Cresset's Susie Cranston is expecting an economic recession, but says her $65 billion RIA sees "great opportunity" to keep investing in a down market.

Edward Jones joins the crowd to sell more alternative investments
Edward Jones joins the crowd to sell more alternative investments

“There’s a big pull to alternative investments right now because of volatility of the stock market,” Kevin Gannon, CEO of Robert A. Stanger & Co., said.

Record RIA M&A activity marks strong start to 2025
Record RIA M&A activity marks strong start to 2025

Sellers shift focus: It's not about succession anymore.

IB+ Data Hub offers strategic edge for U.S. wealth advisors and RIAs advising business clients
IB+ Data Hub offers strategic edge for U.S. wealth advisors and RIAs advising business clients

Platform being adopted by independent-minded advisors who see insurance as a core pillar of their business.

SPONSORED Compliance in real time: Technology's expanding role in RIA oversight

RIAs face rising regulatory pressure in 2025. Forward-looking firms are responding with embedded technology, not more paperwork.

SPONSORED Advisory firms confront crossroads amid historic wealth transfer

As inheritances are set to reshape client portfolios and next-gen heirs demand digital-first experiences, firms are retooling their wealth tech stacks and succession models in real time.