Investing has never been easier thanks to the Robinhood app, a free trading platform that allows users to trade stocks, ETFs, options, and cryptocurrency without fees. In this article, we will review the Robinhood app, its features, pros and cons, and how it compares to other financial apps.
Pros: Where Robinhood stands out
Free trading: Robinhood offers free trading on stocks, ETFs, options, and cryptocurrency. This is a huge advantage for investors, especially options traders who can rack up huge bills at other brokerages that charge fees for each contract. Robinhood is a great choice for options investors looking to get into the market.
The account minimum and quick funding: Robinhood has no account minimum, and its funding process is fast and easy. By using instant verification with major banks, Robinhood allows users to avoid the hassle of traditional verification of reporting tiny deposits into their bank accounts. This means the app can move up to $1,000 of any deposit into the account immediately, with the rest following a few days later.
Intuitive mobile app: Robinhood’s mobile app is simple to navigate, with a convenient search bar at the top of the screen that allows users to quickly pull up a stock chart. It provides the stock’s vital statistics, including its highs and lows, market cap, and dividend yield. It also offers a news feed, a composite of analysts’ rankings, and a brief profile. Users can place market orders, limit orders, and stop orders easily.
Cons: Where Robinhood falls short
No mutual funds: Robinhood does not offer mutual funds, which can be a drawback for some investors who prefer them as part of their investment strategy.
Limited account types: Robinhood offers only individual taxable accounts, joint taxable accounts, and Traditional, Roth, and SEP IRA accounts.
Unclear markups on cryptocurrency: While Robinhood offers commission-free trading on some cryptocurrencies, it is unclear how much users are paying in markups.
Limited customer support: While Robinhood has improved its customer service with 24/7 chat functionality in addition to phone and email options, there have been complaints about the company’s treatment of customers in the past.
Comparison to other financial apps
Webull: If you’re looking for a financial app, Webull may also be for you. It offers some visually appealing charting capabilities in addition to slick functionality.
Fidelity Investments and Charles Schwab: These companies also offer free stock and fund trading and have strong investor-friendly cred. They offer stronger research and education, if that’s what you need.
Overall, Robinhood is a solid choice for investors looking for a free trading platform with a mobile-first approach. Its easy-to-use mobile app, no-cost trades, and quick funding make it an attractive option. However, its lack of mutual funds, limited account types, unclear markups on cryptocurrency, and limited customer support may be drawbacks for some users.