AJ Bell takes on Freetrade et al with zero-commission stock trading app Dodl

AJ Bell has thrown its hat into the competitive ring of digital zero-commission stock trading with plans for a new standalone app Dodl to be launched in 2022.

The wealth manager, one of the largest online direct to consumer investment platforms, will launch Dodl with an annual charger of 0.15 per cent but not fees on trades. At present, the app will just have UK equities at launch with plans for global stocks to follow.

In addition, there will also be a range of ‘themed investments’ which include funds focusing on core areas such as technology, robotics, healthcare and responsible investing.

The fund range will also consist of the AJ Bell’s low-cost multi-asset funds, which cater for six different risk levels

It will include a full range of tax wrappers at launch including an Individual Savings Account (ISA), Lifetime ISA, Pension and General Investment Account. Customers will be able to set up regular investments and consolidate existing ISAs and Pensions onto the platform.

Launched in 1995, the company was one of the original ‘fund supermarkets’ to spring up in the first wave of online investment portals and has steadily builts its assets under management to c.£73bn spread across 382,000 customers.

The move signals a clear expression of fee compression, particularly for trading individual securities underway following the launch of the neobrokers such as Freetrade here in the UK. 

Freetrade, which launched at the end of 2018, has one million customers and c.£1bn of assets on its platform meaning the average Freetrade customer has about £1,000 in their account whereas AJ Bell has closer to £200,000 held by the average user.

Nonetheless, clearly, the arrival of zero commission trading just three years ago is starting to place pressure on incumbents.

Andy Bell, chief executive of AJ Bell, says Dodl by AJ Bell is for anyone looking for a jargon-free and low-cost “easy-to-use investment app to help them meet their investment goals such as saving for a house deposit, holidays or retirement”.

“The intuitive investment journey and streamlined investment range will appeal particularly to those that are new to investing and want a simple way to manage their investments,” he said.

“With a low annual charge of 0.15 per cent, no trading commissions and all the main tax-efficient products, Dodl will be amongst the cheapest and best value investment platforms in the market,” he added.