StockTwits to Launch No-Fee Stock Trading Service

The move mimics the fast-growing service already offered by commission-free investing app Robinhood.

StockTwits, the New York-based social trading network that operates a Twitter-like service for investors, plans to launch a commission-free share trading service for its more than 1.5 million users.

The move mimics the fast-growing service already offered by commission-free investing app Robinhood, which also has zero brokerage fees and has reached five million users in the US. Robinhood raised last year its latest round of funding, ‎bringing in $363 million at a $5.6 billion valuation. It also shows how fintech startups are rapidly branching out to offer a range of services beyond their initial area of focus as they seek to add more customers.

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StockTwits is also set to offer the fractional trading feature which eliminates the barriers that many investors face when trying to invest in a diversified portfolio of US-listed securities.

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More firms turn to cheap trading offerings

Many firms are now using cheap or free trading to attract clients to more profitable businesses. For now, they can keep their free platform afloat through making compromises to some ‎business aspects such as not having many physical locations, a small staff ‎for client service, and not spending on massive promotional campaigns. ‎

Commenting on the news, Ian Rosen, CEO of Stocktwits, said: “With 150,000 messages sent every day on the platform, Stocktwits prides itself on understanding the retail investor and trader. We built Trade App to create a better experience for investors and traders of all levels. Self-directed doesn’t have to mean self-destructive, and we believe the key to success lies in not relying solely on yourself.”

He continues: “As the largest community of active investors, Stocktwits is already a significant portion of the total active investor community in the U.S. Commission-free trading was a major step forward in making active investing more accessible. At Stocktwits, we asked ourselves who in the brokerage space was both attracting and keeping new investors by capturing the daily excitement we see around trading. We saw no one. So, we built a brokerage that matches the excitement and pulse of the community we’ve built.”

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