Bank of America joins brokerage wars with unlimited free trades for preferred members


Brian Moynihan, CEO, Bank of America

Scott Mlyn | CNBC

Another financial giant has decided that the correct price to trade a stock is zero.

Bank of America said Monday that any customer of its retail banking loyalty program will now get unlimited free trades for stocks, ETFs and options. Previously, retail customers with at least $20,000 in balances got 10 or more free trades, depending on what tier a user qualified for.

The free trades, through the bank’s Merrill Edge online service, are part of a host of perks that members earn by bringing more of their dollars to the bank. The lender probably isn’t giving up much in fee revenue with the move: it estimated that 87% of trades from its loyalty group members were already free.

But Bank of America’s move solidifies the race to zero in the retail trading world. Commissions have been falling for decades as discount brokerages proliferated, a trend that accelerated as free-trading start-up Robinhood began to gain millions of users. Rival megabank J.P. Morgan Chase joined the fray last year when it introduced its own free trading service.



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