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Financial Planning > Charitable Giving > SRI Impact Investing

Folio Investing Acquires 200,000 Brokerage Accounts From Online BD

By Emily Zulz

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Folio Investing acquired more than 200,000 brokerage accounts from Loyal3, a San Francisco-based online broker-dealer.

In April, Loyal3 sent an email to account holders that the platform was closing down in May.

And, on May 22, Folio converted the Loyal3 accounts to FolioFirst, a new website just for Loyal3 customers.

“Our platform offers Loyal3 customers the opportunity to diversify their investment portfolio in a consistent and thoughtful manner, by using fractional shares and at an exceptionally low cost,” Steve Wallman, CEO of FOLIOfn, said in an email to ThinkAdvisor. “These are many of the reasons why this acquisition made sense for Folio and Loyal3. We are pleased that our innovative brokerage technology will be able to help so many former Loyal3 customers become better investors.”

On FolioFirst, former Loyal3 customers will now have access to many features common to the Folio Investing retail platform.

Investors can choose from more than 200 stocks – almost three times as many as Loyal3 – and three exchange-traded funds.

Dollar-based and fractional share trading will still be available for Loyal3 customers so that investors can buy partial shares of securities and own what they want, regardless of the share price.

However, initial public offerings are no longer available through FolioFirst as they were in Loyal3.

FolioFirst pricing includes commission-free security trading (up to 2,000 per month in twice-daily trading windows) for one flat fee of just $5 per month. The FolioFirst account fee will be waived until Aug. 1 for all clients.

Certain accounts are not charged the $5 fee until their first purchase or sale of securities – this includes T-Mobile Rewards customers and certain brokerage customers whose account balances upon transfer to FolioFirst were less than $100. For customers who are not charged the $5 monthly fee, an annual account fee of $15 will apply, beginning Feb. 1, 2018.

There is no minimum account balance with FolioFirst.

According to Peter Jacobstein, senior vice president of Folio Investing, the acquisition will allow Folio to help Loyal3 customers achieve their investing goals.

“This acquisition furthers Folio Investing’s mission of enabling smarter investing, strengthens our presence in the online brokerage space and helps us grow,” Jacobstein said in a statement.

The terms of the transaction are not publicly available.

This is Folio’s most recent acquisition. In November, Folio acquired First Affirmative Financial Network, one of the nation’s most prominent RIA firms specializing in sustainable, responsible and impact investing.

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