The race for your investment dollars is on. Chase You Invest is the latest competitor to throw their app into the game.
Just a few months ago, perennial low cost leader Fidelity announced not one but two zero fee mutual funds while lowering “nuisance” fees such as closing fees. This come after Robinhood and M1 Finance both offer commission free investing. Now, JP Morgan Chase, the nation’s largest bank released ‘You Invest’ which is offering at least 100 free trades to investors who want to see their money work.
Is the You Invest App the right way to go for new investors? Here’s what you need to know about it.
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- 100 Free Trades Per Year, Then $2.95 Per Trade
- Large selection of stocks, ETFs, mutual funds, bonds, and more
- Enjoy up to $625 when you open and fund a new You Invest Trade account with $25,000 or more in new money within 45 days
Chase You Invest Details
100 Free Trades, Then $2.95
Up to $625
How The You Invest App Works
The You Invest app is available through the Chase Mobile Banking app. If you’re an existing Chase customer, the new ‘You Invest’ functionality just unlocked the last week of August 2018. If you’re not an existing Chase customer, you can still open a ‘You Invest’ account through the Chase website. You do need to be at least 18 years old with a valid social security number to open up the account.
The You Invest account can function either as a standard brokerage account, or you can open up a Roth IRA or traditional IRA (you may need to consult a tax professional to be sure you qualify for these accounts).
The You Invest app gives every new customer 100 free trades per year, and the account balance minimum is $0. You can trade stocks, ETFs, mutual funds, bonds (as in directly purchasing bonds), and other fixed income assets (think CDs).
Once you use all 100 free trades (unless you’re an active investor with a broad portfolio, that’s unlikely), you’ll pay $2.95. The price isn’t as good as Robinhood’s or M1 Finance's, but it’s lower than most other full service brokerages.
All customers receive up to 100 commission-free trades in each of two retirement and two non-retirement You Invest Trade accounts, and the trades must be used within one year of account opening. Joint accounts receive a maximum of 100 commission-free online trades, based on the primary account holder.
What Makes You Invest Different From Other Trading Apps?
In addition to giving you the ability to buy and sell assets for free, the You Invest app is doubling down on investor education. It has a number of articles in it’s “Learning and Insights” section that can help newer investors understand how to look at their portfolios. But even more importantly, the app is designed to help you find investments that will help you reach your goals.
You can use the app’s “Find Investments” section to find investments that fit your parameters. It’s possible to adjust parameters based on asset classes, fees, risk tolerance and more. Even better, you’ll be able to look at stocks, ETFs, Mutual Funds and fixed income assets that meet your parameters. To be honest, this doesn’t sound like a special feature, but to the discredit of the investing industry, it is. JP Morgan Chase is one of the first brokerage companies that is using technology to help investors choose investments that fit with their goals, without spoon-feeding the “right” option.
For example, when you look at Mutual Funds, you’ll see the MorningStar ratings on the fund, and you’ll quickly learn how the fund will fit into your overall portfolio. Speaking of the overall portfolio, the Portfolio summary section on the front “page” of the app breaks down your portfolio by asset class. The stocks section will give you everything you need to perform a complete fundamental analysis of the stock (including company news if it’s available).
The You Invest app differentiates itself from other investing apps by helping investors keep an eye on their total portfolio while giving them the flexibility to choose from a variety of investments. Just be sure to note that while the You Invest app is a “trading” app, you can’t trade options or foreign currencies or trade on margin within the app. However, options and margin are available on Robinhood for free.
All things considered, it’s still a fairly conservative investment app.
You Invest Portfolio Builder
If you have a balance of at least $5,000 in your You Invest account, you become eligible to use the free Portfolio Builder tool. The portfolio builder tool analyzes your stocks and ETFs to see if the portfolio as a whole fits within your “risk profile” which is defined as your investment time horizon, your goals and your perceived ability to handle market fluctuations.
The portfolio builder won’t force you into certain investments, but it will warn you if you’ve selected investment options that aren’t well suited to your risk profile.
You Invest Managed Portfolios
In addition to the Portfolio Builder, JP Morgan Chase promises that it will release managed portfolios by early 2019. It’s too early to say exactly how these will function, but it’s expected that it will be a “robo-advisor” style allocation of low cost ETFs.
How Much Does The App Cost?
Downloading the You Invest app (ie the Chase mobile banking app) is free. You won’t pay maintenance fees or any other bogus charges. Everyone who opens an account currently gets 100 free trades. After that, buying stocks and ETFs costs $2.95 per trade.
Chase Private Client, Chase Sapphire Banking, J.P. Morgan Private Bank and J.P. Morgan Securities clients get free trades all the time.
Buying mutual funds through the app is always free. If you want to buy bonds, you’ll pay $1 per bond (with a $10 minimum and a $250 max). Fixed income also costs $1 per trade.
JP Morgan Chase also promises that it will have managed portfolios within the app by early 2019. The fee structure for those portfolios hasn’t been announced yet.
What Are The Alternatives To The You Invest App?
If you’re an individual stock investor who has dozens or hundreds of individual positions, the You Invest app isn’t the right app for you. Robinhood or M1 Finance will help you manage your portfolio without incurring excessive fees. You may have to use outside sources to evaluate each position in your portfolio, but it’s still better than paying for dozens of trades every quarter. Likewise, active traders will need to choose another app such as TD Ameritrade’s app or Robinhood.
At the other end of the spectrum, people who want to take a completely hands off approach to their investments won’t find what they need through You Invest. Automated investment platforms such as M1 Finance or Betterment offer best in class asset management for a low cost.
However, when it comes to “investors in the middle.” People who want some individual positions, but a lot of index funds the You Invest app offers a good balance. It’s an ideal design for investors who are still learning about their investing style (as long as that style doesn’t end up being active trader).
Overall, the You Invest app makes a lot of sense for people who have some investing knowledge, but want to dive deeper into areas like individual stocks or less traditional ETFs. With at least 100 free trades per year, the You Invest app can be a great way to explore new investment options without racking up huge fees.
The You Invest app is an exciting development, and it’s great for consumers. Just remember, it’s not the only way to invest for free.
DISCLOSURE - INVESTMENT PRODUCTS: NOT A DEPOSIT • NOT FDIC INSURED • NO BANK GUARANTEE • MAY LOSE VALUE