Citigroup says it has launched a new self-directed digital offering with free trades on certain investment products and no account minimums.
Citi Self Invest, as the new service is called, offers “no-cost” self-directed investing in equity and exchange-traded funds, although underlying ETF management fees still apply, according to the company. Citi says it plans to expand the offering in the coming months to other investment options, including mutual funds.
Customers can trade and manage accounts through the firm’s mobile app and have round-the-clock access to live support, according to the company.
The new offering is in addition to the firm’s robo-advisor, Citi Wealth Builder, rolled out in February 2020 with a $1,500 account minimum and a 0.55% advisory fee.
Citi’s new no-fee offering, meanwhile, will compete with a growing list of competitors.
The online brokerage Robinhood Financial — which has filed for an initial public offering amid regulatory scrutiny and lawsuits from users — has built its business on its zero-commission premise. The firm makes its money through payments for order flow.
Incumbent firms have also joined in the no-fee game. In 2019, Charles Schwab, E*Trade, Fidelity Investments and TD Ameritrade announced they were dropping trading commissions. These firms were followed within days by Bank of America, which unveiled unlimited commission-free stock, ETF and options trades to members in all tiers of its “Preferred Rewards” program, which has an account minimum of $20,000, as reported. And the firm then extended free trades to all customers of its self-directed Merrill Edge platform, as reported.
And most recently, Fidelity started offering zero-commission trading accounts to 13- to 17-year-olds whose parents or guardians already have brokerage accounts with the firm.
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