Summary
- Fidelity Investments announced on Tuesday, May 18, that it will allow teenagers to invest in the stock markets.
- Via its newly launched Fidelity Youth Account, minors between the ages of 13 and 17 will be able to buy and sell stocks, ETFs and Fidelity mutual funds without paying any fee.
- There is, however, a catch.
Targeting a new segment of potential customers, Fidelity Investments announced on Tuesday, May 18, that it will allow teenagers to invest in the stock markets.
Via its newly launched Fidelity Youth Account, minors between the ages of 13 and 17 will be able to buy and sell stocks, ETFs and Fidelity mutual funds without paying any fee. The company said in a statement that it is also planning to issue debit cards and investing/saving accounts for teenagers.
The catch, however, is that only wards of parents and legal guardians who invest in Fidelity Investments will be able to avail these facilities.
This move aims to position the company as a lifelong financial advisor to millions of young Americans who would be interested in learning more about stock market investments.
Fidelity’s Senior Vice President Jennifer Samalis said that the company is committed to supporting young investors and help them learn new things about growth investing.
What You Must Know About Fidelity Investments
The value of Fidelity Investments' assets under administration stands at US$ 10.4 trillion. It claims to help more than 35 million people with various financial services.
Fidelity manages employee benefit programs of over 20,000 companies and provides investment and technology solutions to at least 13,000 financial institutions, as per the company.
The financial services provider reportedly employs over 47,000 people and is present in nine countries. It is also said to have some 37 million registered individual investors, recording 3.5 million trades per day.
Why A Fidelity Youth Account?
During a pilot survey, Fidelity found that a youth account expanded the level of knowledge of teenagers and that about three in four teens felt more confident about trading in stocks/ETFs.
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Fuelling the claim that the young generation is interested in trading, reports show that some 1.6 million retail accounts were opened by investors under 35 in the first quarter of 2021, noting a 222.8 per cent year-over-year (YoY) rise.
And now with the teenager account, the company could give an entry point to young investors from an early age.
The above constitutes a preliminary view and any interest in stocks should be evaluated further from an investment point of view.
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