Charles Schwab Corp. will soon introduce fractional-share trading capabilities on its platform in a bid to draw in younger customers, The Wall Street Journal reported, citing an interview with Chairman Charles Schwab.
The San Francisco-based online brokerage wants to become the first major U.S. online brokerage to offer the ability to buy into high-priced stocks such as those of Alphabet Inc., Berkshire Hathaway Inc. and Mastercard Inc. without needing thousands of dollars to do so. Fractional-share trading is one of several new programs the company plans to roll out in the near future, Schwab said in an interview with the paper.
The comments come less than two weeks after Schwab launched commission-free trading for online U.S. stocks, options and exchange-traded funds.
While Schwab's introduction of free trading caught some analysts off guard, the move represented the starting gun in the online brokerage industry's race to zero. E*TRADE Financial Corp., TD Ameritrade Holding Corp. and Fidelity Investments all followed closely by announcing they were also launching free trading on their platforms.
A Schwab spokesperson said in an email that the company does not have any specifics to share on the potential for fractional-share trading "right now," but added that the company is "always evaluating and working on new services to improve how people can invest."