Merrill Lynch to offer low-fee ‘Net stock trading

Tuesday, June 1, 1999 | 11:32 a.m.

NEW YORK -- The brokerage firm that brought investing to Main Street is going online.

Merrill Lynch & Co., joining startups like ETrade as well as long-established brokerages like Charles Schwab, announced today it is creating an Internet site for individuals to buy and sell stocks for $29.95 a trade.

"It appeared foolish for us to ignore that part of the market," David Komansky, chairman and chief executive of Merrill Lynch, said. "So we decided to attack it."

The nation's largest brokerage said the site will begin operating in December and will also allow users of the site to purchase mutual funds, bonds and other securities.

The move poses a big risk for Merrill Lynch, which makes billions of dollars annually through full-fee commissions on stock and other trades and depends on its network of 15,000 brokers for its customer base. But mainstream investment firms are finding themselves increasingly pressured to compete with online brokerages by offering lower fees for trades executed online.

"This is probably the most important decision we have made as an organization since the 1970s," Komansky said, referring to the launch of the Cash Management Accounts, which offer an all-in-one brokerage account with some banking features.

The company's stock was off $5.75, or almost 7 percent, at $78.25 in midday trading on the New York Stock Exchange.

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