Interest in stock trading
among young investors has soared in the last year, and commission-free trading
apps like Robinhood get much of the credit. But the interest has
spread far wider, toward older and more traditional players in the brokerage
arena. Today, Fidelity said that it added 4.1 million new accounts in
the first quarter, 156% more than it gained in the year ago period. Some 1.6
million of those adds came from investors 35 or younger.
Barron's Daren
Fonda notes today that Charles
Schwab recently reported similar growth
for its first quarter, adding 3.2 million new brokerage
accounts, more than the firm added in all of 2020.
Here's more from
Daren:
The results
from both Fidelity and Schwab indicate that the market incumbents won’t easily
be dislodged by trading apps like Robinhood or the proliferation of
commission-free trading across banking and brokerage platforms.
A strong bull
market is certainly helping the big discount brokers, along with online
communities like WallStreetBets that are encouraging retail investors to try
their hand at day trading. Ultra-low interest rates and liquidity being pumped
into the market by the Federal Reserve is also stoking more risk-taking.
While it all may have the
hallmarks of a bubble, Fidelity, Schwab, and other discount-brokers are
enjoying the results.
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