Square Inc. has launched both stock and fractional-share trading on its peer-to-peer mobile app.
"Now anyone can buy $42 or even $1 worth of Berkshire Hathaway A ... instantly and for free," in the Cash App, Square Chairman, President and CEO Jack Dorsey said on Twitter.
Square had been testing the free stock trading service since at least September, when Bloomberg News reported that employees had been testing the service in recent weeks.
The feature puts the payments processor in direct competition with fellow Silicon Valley startup Robinhood Markets Inc., which rose to prominence on its fee-free trading app. Following the latest price war, it could also put Square up against the established traditional online brokers, including E*TRADE Financial Corp., Charles Schwab Corp. and TD Ameritrade Holding Corp., which all recently cut certain trading fees to zero.
Schwab was the first of the major online brokers to introduce fractional-share trading capabilities on its platform last week in a bid to draw in younger customers. That trading option allows customers to buy into high-priced stocks such as those of Alphabet Inc., Berkshire Hathaway Inc. and Tesla Inc. without needing thousands of dollars to do so.
Fellow Silicon Valley startup Social Finance Inc. also launched fractional-share trading in September, at the same time it announced it will start trading three cryptocurrencies.