Robinhood App Evaluation 2024 – Free Inventory, ETF, and Crypto Trades

What Is Robinhood?

Robinhood launched its common inventory buying and selling app in 2015 and was one of many first on-line brokerages to supply commission-free trades.

Since then it’s expanded its product providing to incorporate crypto buying and selling, retirement accounts, and a handy spending account.

As of 2022, Robinhood had roughly 23 million members. Robinhood is a official buying and selling platform. It’s a member of the Monetary Business Regulatory Authority (FINRA) and has Securities Investor Safety Company (SIPC) insurance coverage, so your stability is protected as much as $500,000 (with a $250,000 restrict on money). That is to guard in opposition to fraud, not the lack of worth.

Robinhood Free Inventory Provide

For a restricted time, Robinhood affords a free share of inventory (valued between $5 – $200) while you open an account by way of a hyperlink on our website. There isn’t a deposit required and no account upkeep charges to fret about.

Click on the hyperlink beneath and revel in your free inventory share!

Get Began with Robinhood

Finest Robinhood Options

Right here’s a better take a look at the principle options Robinhood has to supply.

Free Inventory and ETF Buying and selling

With Robinhood, you should buy or promote most particular person shares and ETFs that commerce on the U.S. inventory exchanges. Robinhood additionally affords fractional investing, so you should buy partial shares for as little as $1 at a time fee-free, making it straightforward to afford dearer shares whereas sustaining a various portfolio.

Among the instruments obtainable to all buyers embody:

• A number of order varieties: The default is to put market orders (purchase or promote on the present buying and selling worth), however you may also select restrict orders (commerce executes inside a selected worth vary).
• Worth chart: Whereas Robinhood’s analysis instruments are restricted, you’ll be able to view a fundamental historic inventory chart for a possible funding.
• Rankings: Robinhood permits you to view a consensus of what number of inventory analysts are bullish or bearish. The platform additionally exhibits fundamental monetary knowledge, information headlines, and comparable shares.
• Inventory lending: Lengthy-term buyers can enroll within the Robinhood Inventory Lending program to earn curiosity by lending their shares to margin merchants. 
• Prolonged hours buying and selling: Whereas most buyers can solely purchase or promote shares and funds throughout regular market hours when liquidity is at its highest, the Robinhood 24-Hour Market permits you to commerce lots of your favourite shares between Sunday @8PM EST and Friday @ 8 PM EST. It’s necessary to notice that there are elevated dangers to buying and selling exterior market hours, which Robinhood covers in its Prolonged Hours Buying and selling Disclosure.

Robinhood additionally affords many OTC and ADR inventory symbols that allow you to commerce penny shares with skinny liquidity and buying and selling costs beneath $5. Often, it’s good to use a standard on-line brokerage like E*TRADE, Constancy, or Schwab to purchase or promote these tickers.

Sadly, you can not purchase or promote foreign-listed shares that commerce immediately exterior the US. For instance, you can not purchase Nintendo inventory from the Tokyo Inventory Trade — you would need to buy the US-listed NTDOY share as a substitute.

Robinhood Crypto

You possibly can commerce a number of common cryptocurrencies commission-free on the Robinhood trade, together with BTC, ETH, DOGE, SHIP, AVAX, UNI, ETC, LINK, XLM, AAVE, and extra. In accordance with Robinhood, most of its prospects’ cash are held offline, in chilly storage, for extra safety.

You may also switch your crypto to and from Robinhood to different crypto wallets, with out incurring any deposit or withdrawal charges.

Robinhood claims cryptocurrency buying and selling by way of its platform is cheaper than devoted crypto exchanges, equivalent to Coinbase, Kraken, and Crypto.com. Nevertheless, most crypto exchanges supply extra token choices and make storing the precise token keys simpler.

Robinhood Choices

Skilled buyers* can apply to open a Robinhood Choices buying and selling account. There are not any fee charges on trades or choices contracts.

To get began, you’ll should open and fund your Robinhood account and choose the Choices buying and selling choice in account settings. You’ll want to supply further monetary info and reply questions on your funding expertise.

Robinhood approves choices buying and selling at two ranges: Stage 2 and Stage 3. Stage 2 can accommodate fundamental choices buying and selling methods, whereas Stage 3 permits for extra advanced methods.

Robinhood affords the next choices buying and selling options:

• No commission-fees on trades or choices contracts
• Superior charts (observe and modify Shifting Common (MA), Relative Power Index (RSI), and extra
• Technique Builder allows you to construct vertical spreads, calendar spreads, strangles, straddles, and extra.
• Watchlist allows you to save and monitor choices contracts with out buying and selling
• Commerce choices in a Robinhood IRA account
• Trade and regulatory charges might apply

* After a tragic demise of a younger Robinhood investor in 2020, the brokerage has carried out a number of safeguards to assist customers handle danger with choices buying and selling. Regardless, choices buying and selling stays unsuitable for inexperienced buyers, who’re higher off sticking to conventional, long-term funding methods.

Robinhood Retirement

With the launch of Robinhood Retirement in 2023, now you can open a tax-advantaged conventional and Roth IRA. This new characteristic provides worth to Robinhood as buyers can use it for short-term and long-term investing.

Robinhood makes it straightforward to switch from exterior accounts. This contains transferring an current IRA or rolling over an previous 401(okay). While you switch, Robinhood can pay 1%, with no cap, on prime of the switch quantity. Observe which you could commerce choices in a Robinhood IRA account.

Gold subscribers with an IRA account will obtain a 3% IRA match on all eligible contributions for a restricted time. contributions. Provide expires April 30, 2024. Phrases and circumstances apply.

Robinhood Gold

Robinhood affords an optionally available month-to-month subscription known as Robinhood Gold that unlocks a number of premium advantages for $5/month after a 30-day free trial.

You’ll obtain the next advantages on non-retirement brokerage accounts:

• $5 month-to-month
• 5% APY your uninvested money (vs. 1.5% for non-Gold members)
• 8.00% margin account rate of interest (12.00% with out Gold)
• Make Greater Instantaneous Deposits of as much as $50,000 ($1,000 restrict for non-Gold)
• Entry to Morningstar skilled analysis ($249 annual worth)
• Nasdaq Stage II market knowledge

Robinhood Money Card

The Robinhood Money Card is a pay as you go debit Mastercard issued by Sutton Financial institution, an FDIC member. It replaces Robinhood’s Money Administration product, which is now not obtainable to new prospects. The Robinhood Money Card is free and will assist enhance your financial savings and spending energy. 

This account is just like a rewards checking account and contains the next advantages:

• A round-up financial savings characteristic allows you to make investments mechanically while you spend.
• Schedule recurring funding contributions out of your paycheck
• Early entry to your direct deposit
• Earn money again at taking part shops
• As much as $250,000 in FDIC Insurance coverage (that is pass-through protection from associate banks)
• Mastercard Zero Legal responsibility Safety

Get Began with Robinhood

How does Robinhood earn a living?

That is the million-dollar query – how can an organization making a gift of free trades earn a living? One clue is from the optionally available Robinhood Gold service, which prices $5 month-to-month. Nevertheless, premium subscriptions alone can’t energy one of many world’s busiest investing apps with tens of millions of accounts.

Robinhood supplies the reply within the FAQ part of its web site. Listed below are the assorted ways in which Robinhood makes cash:

• Cash off order circulation (a rebate that exchanges give for offering liquidity)
• Robinhood Gold subscriptions
• Curiosity from margin buying and selling accounts
• Inventory loans
• Curiosity from uninvested money
• Money administration accounts

It’s doable to commerce shares and funds 100% free on Robinhood. Nevertheless, a “hidden price” is order circulation buying and selling. Particular person merchants place a commerce with out paying charges, however simply earlier than the commerce is executed, the market maker would possibly pay a small fee to the app for routing the order by way of their trade. Whereas this observe is questionable, many free apps use the identical execution high quality to generate earnings. 

Find out how to Get Began with Robinhood

You possibly can join with Robinhood on-line by way of its internet platform or by downloading the Android or iOS cellular app. New customers may obtain one free inventory after the signup course of.

I signed up on my pc quite than my cellphone as a result of I’d quite not sort in a bunch of account info on a tiny keyboard. The sign-up course of takes about 5-10 minutes and also you’ll want to supply some fundamental info – identify, handle, Social Safety, birthday, and different demographic info.

You’ll even be prompted to hyperlink up your checking account by way of Plaid and switch funds into your account. You possibly can hyperlink most financial institution accounts by way of this third-party service utilized by a whole bunch of private finance apps to keep away from storing your login credentials on their servers. 

You may also switch property into Robinhood and be reimbursed as much as $75 per account in transfer-out charges that your previous brokerage costs you. When you join, it’s time to log in, and also you’re off to the races.

Is Robinhood Secure?

Briefly, Robinhood is protected.

Since it’s a dealer, it’s regulated by the SEC (Securities and Trade Fee) and is required to have security measures just like different brokers. For instance, Robinhood has SIPC insurance coverage of as much as $500,000 for securities and $250,000 on money.

Robinhood can also be regulated by FINRA. You possibly can look them up on BrokerCheck beneath CRD# 287900. In the event you do, you’ll see they’ve been accepted since 10/13/2017 and presently have two disclosures.

In addition they have carried out a number of safety measures to guard your knowledge. Your password is hashed utilizing the BCrypt hashing algorithm. Delicate info like your Social is encrypted earlier than storage.

Communications are encrypted utilizing Transport Layer Safety protocol (TLS), and Robinhood received’t retailer your banking credentials as soon as they’ve been authenticated. As a substitute, they’re saved as entry tokens by way of third-party integration.

Lastly, Robinhood employs an optionally available two-factor authentication on its app.

Get Began with Robinhood

What I Like About Robinhood

• The free trades. You possibly can place market, restrict, cease loss, and stop-limit orders on U.S. shares and ETFs with out fee charges. You may also commerce crypto and choices commission-free.
• Fractional shares. Robinhood allows you to purchase slices of any inventory or ETF. The minimal funding is just $1, decrease than many opponents that require you to put a minimum of a $5 per commerce.
• Intuitive buying and selling dashboard. Robinhood does all the things doable to make the buying and selling expertise user-friendly. While you log in, you’re greeted together with your account worth, some historic charts, and related tales in a slider on the backside. Inexperienced when you’re up, crimson when you’re down.
• You will get entry to some pre-IPO shares. Robinhood will periodically e mail accountholders when there are alternatives to buy pre-IPO shares. It will likely be a small collection of shares and received’t be each firm that can IPO, nevertheless it’s higher than nothing. (Technically, these are affords on the open, so not technically “pre-IPO,” however fairly shut)
• Robinhood Retirement: I like that Robinhood has added retirement accounts to its product lineup. It can save you for retirement with a tax-deferred or tax-free IRA. It’s additionally doable to obtain a 1% matching deposit.
• Dividend Reinvestment Plan (DRIP): Robinhood allows you to mechanically reinvest your dividend earnings from shares and ETFs. DRIP investing doesn’t require a minimal funding.

What I Don’t Like About Robinhood

• No help for mutual funds, bonds, or fixed-income buying and selling: You possibly can’t purchase or promote mutual funds or fixed-income investments, together with bonds, by way of Robinhood, a big disadvantage.
• No brief promoting. This received’t affect most buyers, however Robinhood doesn’t supply brief promoting.
• Little to no evaluation is on the market. Robinhood has restricted studies and evaluation instruments. There are information notifications and historic worth charts however that’s the one factor exterior of executing transactions. Lots of the perfect low cost brokers additionally don’t cost charges however supply wonderful inventory screeners, charting instruments, and analyst studies.  
• Restricted buyer help. 24/7 help is on the market by cellphone or stay chat, however it’s possible you’ll want to attend for the dealer to contact you. Conventional brokerages are likelier to have extra brokers readily available morning or evening, notably on risky buying and selling days.
• Inserting restrict orders is cumbersome. In order for you a market order, the method is easy. Nevertheless, restrict orders require you to enter a worth on a separate display. As soon as you choose a worth, you choose how lengthy to maintain it open (“Good for a Day” or “Good until Canceled”), then it goes again to the order display, and also you full your order. After you place the commerce, if you wish to see your order, you could go to “Historical past.” You possibly can’t edit the order, you need to cancel it and re-enter (most brokers will allow you to “edit,” saving you the work of canceling and re-entering.

Robinhood vs. Constancy

Constancy Investments is a full-service on-line brokerage appropriate for buyers of all expertise ranges. Most investing performance is on the market by way of its internet platform. Nevertheless, you’ll be able to solely commerce shares by the slice by way of the Constancy cellular app with a $1 minimal funding. Constancy’s market analysis and evaluation instruments are extra in depth than what Robinhood affords.

Not like Robinhood, you’ll be able to maintain mutual funds, bonds, and fixed-income investments with Constancy. Trades are commission-free for U.S.-listed shares, ETFs, and Constancy mutual funds. You possibly can commerce crypto, however you need to open a separate Constancy Crypto account.

Get the Newest Constancy Promotions

Robinhood vs. Public

Public allows you to commerce shares, ETFs, and crypto with a $1 minimal funding. And, as of February 2024, you’ll be able to earn over 5% APY in your money by way of its high-yield financial savings account.

The app affords fundamental analysis instruments, a built-in social media platform, and the chance to spend money on various property and U.S. Treasuries. Sadly, tax-advantaged retirement accounts are usually not obtainable. For $8/month, Public Premium affords enhanced buying and selling options, extra customer support choices, superior knowledge and evaluation, and portfolio administration.

Our Public assessment covers extra of the investing app’s options. 

Get Began with Public

Robinhood vs. SoFi Make investments

SoFi Make investments allows you to begin buying and selling shares and ETFs by the slice with a $5 minimal funding. Choices buying and selling and retirement accounts are additionally obtainable. SoFi’s analysis instruments are just like Robinhood.

SoFi Make investments could also be a greater choice than Robinhood when you already use SoFI for its banking companies and loans. Additionally, buyers who’re searching for a robo-advisor resolution might SoFi’s automated investing portfolios.  

Take a look at the newest SoFi promotions to earn bonus money with new accounts. 

Get Began with SoFi Make investments

Robinhood vs. WeBull

WeBull allows you to commerce shares, ETFs, crypto, and choices by way of taxable or retirement accounts just like Robinhood. Buying and selling is commission-free, and the minimal funding is $5 for fractional shares.

This service has higher charting instruments than Robinhood with many technical indicators. There may be additionally a paper buying and selling simulator. Webull lately began providing money administration accounts and a robo-advisor service.

Our Robinhood vs. Webull comparability appears to be like extra carefully on the variations between each brokerages. Learn our Webull assessment for extra.

Get Began with Webull

FAQs

Get Began with Robinhood