As interest in the stock market grows and equities continue to soar, investment giant Fidelity said Tuesday that it will launch new investing accounts just for teens.
The offerings for 13- to 17-year-olds—limited to those teenagers whose parents or guardians also invest with Fidelity—will include ways to save and deposit money, a debit card and investing capabilities, all accessible on a mobile app.
Teens will be able to buy and sell U.S. equities, Fidelity’s own mutual funds and ETFs without any fees or commissions.
To open the account, a teen’s parent or guardian must enter into a brokerage agreement with Fidelity, the Wall Street Journal reported, and after that the account—and power to make trades—is transferred to the teen.
Parents will be able to monitor the account’s activity and will retain the ability to close the account at any time, the Journal reported, and teens won’t be able to trade options or borrow money to fund trades.
“Fidelity is committed to responsibly supporting young investors,” Jennifer Samalis, senior vice president of acquisition and loyalty at Fidelity Investments, said in a statement. “Importantly, our goal for the Fidelity Youth Account is to encourage young Americans to learn through action and foster meaningful family conversations around financial topics.”
$10.3 trillion. That’s how much money Fidelity manages. It’s one of the largest stock brokerage firms in the United States.
Old-guard brokerage firms and startups alike are actively pursuing the next generation of investors. Greenlight, a startup that offers debit cards and investing services for kids, was recently valued at $2.3 billion.
Fidelity’s new offering was in the works before the memestock trading frenzy that sent stocks soaring and captivated investors earlier this year, the Journal reported.
In January, retail traders from online communities including Reddit’s r/WallStreetBets and the popular brokerage app Robinhood—which is also aimed at making investing simpler for young investors—pitted themselves against Wall Street institutions which had placed bets that a handful of previously unpopular stocks would fall.
That resulted in a short squeeze that sent Gamestock and other stocks soaring and ignited a national debate about regulation, risky trades and the what some viewed as gamified app-based trading.
Fidelity’s Pitch to America’s Teens: No-Fee Brokerage Accounts (Wall Street Journal)