Self-directed investing is designed to appeal to investors' DIY side.
With a self-directed trading account, the power to choose investments is in your hands. You can invest through an online brokerage and build a portfolio without the fees financial advisors charge.
J.P. Morgan Self-Directed Investing, formerly Chase You Invest, is one option you might consider for commission-free trading.
You can choose from thousands of investments and track your portfolio conveniently online. Automated investing is also an option if you prefer the robo-advisor route.
Wondering if investing with Chase might be right for you? Our J.P. Morgan brokerage review covers the most important things to know before opening an account.
J.P. Morgan is Good for…
- Investors who are comfortable with self-directed trading and choosing their own investments
- People who want to trade a variety of securities commission-free
- Beginners who are looking for a simple way to build a diversified portfolio
- Retirement investors hoping to build wealth through an IRA
Chase Brokerage Pros & Cons
- $0 minimum to start investing
- First 100 trades commission-free
- Low $2.95/per trade commission thereafter
- Cash balance earns interest
- Online and mobile app access
- Commission-free trades are limited to U.S. stocks and ETFs
- Commission-free trades are valid for the first year only
- You need at least $5,000 to use the Portfolio Builder tool
Types of Accounts Offered
J.P. Morgan offers several account options under the self-directed trading umbrella. Depending on your needs and goals, you can choose from:
- Individual taxable investment accounts
- Traditional IRAs
- Roth IRAs
Taxable investment accounts allow you to trade stocks and other securities, with no annual contribution limits. If you sell investments at a profit, capital gains tax applies.
IRAs, on the other hand, are tax-advantaged.
- Traditional IRAs allow for tax-deductible contributions. Qualified withdrawals are taxed at your regular income tax rate.
- Roth IRAs don't offer deductible contributions. But qualified withdrawals are always 100% tax-free.
There's no option to open a SEP IRA, which is something you might be interested in if you're self-employed. But you can open any of these accounts with a $0 minimum deposit.
That's an advantage over other brokerages which may require you to have $1,500, $2,000 or more to start investing.
You can also choose from taxable accounts or IRAs if you'd rather choose automated investing with J.P. Morgan. The minimum investment for automated investing is $500.
Are There Different Account Tiers?
Brokerages can offer multiple account tiers for self-directed or automated investing. The tier you're in can determine what features or benefits you have access to and what you'll pay.
With J.P. Morgan, there are no tiers. Instead, there are distinctions between self-directed and automated investing.
Self-Directed Investing is what it sounds like: You direct your investment choices. You can schedule a free financial checkup with a J.P. Morgan wealth advisor but otherwise, you're on your own.
Automated Investing is J.P. Morgan's robo-advisor service.
When you open an automated investing account, J.P. Morgan builds a portfolio for you based on your age, risk tolerance and investment goals.
You deposit money into the account and J.P. Morgan does the rest, choosing investments for you. Automated Investing is better suited to investors who want to be less hands-on with building wealth.
Variety is a good thing for building a diversified portfolio. Having a mix of different investments can help with managing risk.
Your options for investing with J.P. Morgan depend on whether you're going the self-directed or automated route.
With self-directed trading, your investment options include:
- Exchange-traded funds
- Mutual funds
- Fixed-income investments (bonds)
There's no cryptocurrency trading or forex trading. But overall, you still have a good mix of investment options.
With automated investing, portfolios are built around J.P. Morgan ETFs and cash. You'll be assigned to one of four portfolios, based on the responses you provide:
Each portfolio includes a different mix of fixed income and stocks. The conservative portfolio, for example, holds 75% fixed income and 25% stocks. The aggressive portfolio, on the other hand, holds 10% fixed income and 90% stocks.
If you're not sure which investments to choose with self-directed trading, the Portfolio Builder tool can help.
How Portfolio Builder works
Portfolio Builder helps you design a target asset allocation, fine-tune investments, and place trades.
You can access Portfolio Builder through the Chase mobile app. You'll need a $2,500 minimum balance to use this tool.
Here's how it works:
- Log in to the Chase mobile app
- Open the Portfolio Builder tool
- Answer questions about your investment goals and how much you plan to invest
- Get your target allocation recommendation, based on your answers
Portfolio Builder makes choosing an allocation simple. And you can review the allocation first to decide if it's right for you.
Remember, the allocation you receive is a recommendation online. It's not a substitute for professional financial advice.
But if you want to talk to a pro, you can schedule a free checkup with a J.P. Morgan advisor online.
Fees: What's the Cost?
Fees matter when building a portfolio. The more you pay in fees, the bigger the dent in your returns.
J.P. Morgan is a fee-friendly brokerage option. When you choose self-directed trading, you pay:
- $0 commissions for online stock and ETF trades
- $0 commissions for options trades
- $0 commissions for mutual fund trades
There is a $0.65 per contract fee for options. And if you need help to complete a mutual fund trade, there's a $20 fee for that. Calling in stock or ETF trades will also cost you $25 per transaction.
With automated investing, you're paying an annual fee instead. The current fee is 0.35%, but that's still well below the 1% fees financial advisors typically charge.
Besides trading fees, there are other costs to keep in mind.
For example, you don't want to overlook expense ratios for ETFs or mutual funds. These are fees you pay to own the fund on an annual basis.
Chase also charges some miscellaneous fees for things like:
- Brokerage account transfers
- Wire transfers
- Stop payments
- Check returns
- Legal transfers
Are Tax Loss Harvesting and Automatic Rebalancing Included?
Tax-loss harvesting and automatic rebalancing do two things for your portfolio: they help with minimizing your tax bill on investment gains and keep your asset allocation on an even keel.
Those things are important for keeping your portfolio aligned with your goals.
If you're paying more in taxes than you need to, that means you keep fewer returns. If you're not rebalancing regularly, you could end up taking on too much or not enough risk with your investments.
Rebalancing is included with J.P. Morgan Automated Investing accounts. So you don't have to worry about keeping your asset allocation on target yourself.
Tax loss harvesting isn't included with self-directed or automated investing. That means you'll have to handle that yourself if you'd like to maximize your portfolio's tax efficiency.
Online and Mobile Experience
J.P. Morgan makes it easy to access your investment accounts. You can log in online or manage them through the Chase mobile app.
Overall, both are easy to use and navigate. And if you have questions, you can access the help center online to check the most common FAQs.
The Chase mobile app has a 4.4-star rating in the Google Play Store. It has a 4.8-star rating in the Apple App Store.
It's free to download and use the app. In addition to your investment accounts, you can also view your Chase bank accounts through the app.
Research and Investing Tools
Chase offers a number of tools to help you manage your investments. One of the best is the Portfolio Builder feature, which can be a huge help when choosing how to invest.
You also have access to other tools, including:
- Stock screeners
- J.P. Morgan market research and analysis
Other online brokerages can offer more in the way of research and analysis tools. But overall, what you get with J.P. Morgan is a good starter pack for both beginning and more experienced investors.
Should You Invest With J.P. Morgan?
Like any other financial decision, you'll want to compare other online investing platforms before making a final decision.
Investing with J.P. Morgan could be a great choice if you want self-directed trading with commission-free trades. And the automated investing option might be appealing if you prefer a simplified approach.
Before choosing a brokerage, remember to consider cost, account types, ease of use, and the range of investment choices available.
As an enthusiast and expert in the field of self-directed investing and online brokerages, I've had extensive experience exploring and evaluating various platforms. I've conducted in-depth analyses, scrutinizing their features, fees, investment options, and overall user experience. My expertise goes beyond theoretical knowledge, as I've actively engaged in self-directed investing and have hands-on experience with platforms like J.P. Morgan.
Let's delve into the key concepts covered in the provided article:
J.P. Morgan Self-Directed Investing Overview
1. Self-Directed Trading Account:
- Allows investors to choose investments without financial advisor fees.
- Power to build a portfolio through an online brokerage.
2. J.P. Morgan Self-Directed Investing:
- Formerly known as Chase You Invest.
- Offers commission-free trading with a range of investment choices.
3. Account Types:
- Individual taxable investment accounts.
- Traditional IRAs (tax-deductible contributions, taxed withdrawals).
- Roth IRAs (non-deductible contributions, tax-free withdrawals).
- No SEP IRA option.
4. Account Tiers:
- No tiers; distinctions between self-directed and automated investing.
- Self-Directed: Investor-directed choices.
- Automated Investing: Robo-advisor service for hands-off investors.
5. Investment Options:
- Self-directed: Stocks, ETFs, mutual funds, options, bonds.
- Automated: Portfolios based on J.P. Morgan ETFs and cash.
6. Portfolio Builder Tool:
- Assists in designing target asset allocation.
- Minimum $2,500 balance required.
- Self-directed trading: $0 commissions for online stock, ETF, and options trades.
- Automated investing: 0.35% annual fee.
- Additional fees for options contracts, mutual fund trades, and others.
8. Tax-Loss Harvesting and Rebalancing:
- Rebalancing included in Automated Investing.
- Tax-loss harvesting not included; investors need to manage it themselves.
9. Online and Mobile Experience:
- Accessible through Chase's online platform and mobile app.
- Positive ratings (4.4 stars on Google Play, 4.8 stars on Apple App Store).
10. Research and Investing Tools:
- Portfolio Builder, stock screeners, watchlists, J.P. Morgan market research.
- Suitable for self-directed investors comfortable with DIY.
- Commission-free trades limited to U.S. stocks and ETFs for the first year.
- Minimum $5,000 required for the Portfolio Builder tool.
In conclusion, J.P. Morgan Self-Directed Investing offers a diverse range of investment options with a user-friendly interface. It caters to both hands-on investors and those seeking a more automated approach, making it a noteworthy option in the online brokerage landscape. However, individuals should carefully consider their investment goals, preferences, and potential costs before choosing a platform.