The Robinhood investing app has become very popular among the younger generation. Many people are aware of the investing platform but are unsure whether or not they should use it. Here’s our Robinhood review.
The Robinhood app gives members free stock, cryptocurrency, options, and ETF trading. While competitors have quickly flocked to replicate Robinhood’s comission-free model, there are still some things that make Robinhood stand out.
To start off, Robinhood provides a very easy-to-use trading platform. Whether you are on the mobile app or Robinhood’s website, making a trade is very easy to do within the platform.
Robinhood also offers its users free cryptocurrency trading. Cryptocurrency offers an interesting way to diversify your portfolio, and acts as a hedge against the traditional money system.
Robinhood App Review
Commissions: This is where Robinhood has always been appealing; they offer commission-free trading. After all, every dollar you pay for a commission hurts your overall return.
Account Minimum: Robinhood does not require an account minimum, which means that as long as you can afford the asset you are interested in, you can invest! The only minimum that Robinhood has is on its margin account, which is not an uncommon practice.
Fractional Shares: Robinhood now offers the purchase of fractional shares to some of its users, although as it stands there is a lengthy wait list to get access to this feature. Fractional shares allow you to invest in a share that you would not normally be able to afford by purchasing a fraction of it.
Cash Management: Just like fractional shares, Robinhood’s Cash Management feature also has a long wait list. Cash Management has some interesting features such as 1.80% APY, FDIC Insurance on up to 1.25 million dollars, flexible spending on a Robinhood debit card, and fee-free access to 75,000 ATMs.
Interface: Robinhood may fall short at offering all of the bells and whistles that other online brokers do, but their streamlined experience is great for some investors. The platform supports market, limit, stop limit and stop orders. Robinhood also shows collections of different stocks organized by sector, price, industry, etc.
Robinhood Gold: Robinhood Gold gives users the ability to trade on margin, or in other words trade with borrowed money. The Robinhood Gold feature carries a $5 monthly fee. Newer investors should be aware that trading on margin is highly risky, and we do not suggest it.
Robinhood Snacks: Snacks is Robinhood’s financial newsletter. Things that are included are newsletters and podcasts, with the goal of making news “digestible”.
Robinhood App Features
The Robinhood app itself is split into five different sections: Investing, Cash Management, Search, Messages, and Account.
The Investing tab allows you to view how much your Robinhood investment account is currently worth. Plus, you can see the value of each individual holding in your account.
The Cash Management tab will allow you to sign up for the new feature. Once you have signed up, you will be added to the waiting list to become accepted. This section also goes over some of the key features of Robinhood Cash Management.
The Search tab is where you can do your research on different assets to invest in. You can search for them by the symbol or the name, and once you find them you can view more information on the different assets.
Next there is the Messages tab, which is essentially how Robinhood communicates with you. Within this tab, you will receive confirmations on buying or selling, as well as transfers into Robinhood.
Lastly there is the account tab, which involves everything to do with your account. In this tab users can access: free stocks, investing, transfers, statements & history, settings, and help.
Robinhood Platform Positives
The Robinhood investing platform’s main positive is its ability to offer low-cost investing. Robinhood has shown that offering investment services for free is hard to beat, and for this reason other brokers have given in to offering commission-free trading.
Robinhood’s commission-free approach covers not only stocks, but also options, cryptocurrency, and ETFs. The savings can really add up for an investor who makes trades often.
The only cost to be aware of if you plan to use the Robinhood trading platform is the $75 outgoing account transfer fee. This is when you move your investments to another broker, and the fee is common.
Another positive of the Robinhood platform is the fact that there is no account minimum. This means that investors can get started as long as they can afford the investments they are interested in.
Cash Management and Fractional shares are another positive of the Robinhood platform – the only thing is you might have to wait a long time to get them. Once you are off the wait list you get to enjoy these benefits.
One thing that you will notice soon after you start using Robinhood is how easy it is to use. If you are someone who uses their smartphone often, navigating through the Robinhood app should be a breeze.
Their website is just as easy to use as their app, and if you are someone who is used to using your computer it should not be a challenge for you to use Robinhood on their website.
One of the criticisms of Robinhood is that their research offerings come up short when compared to other brokers. This is understandable due to Robinhood being a commission free investing service.
Robinhood Platform Negatives
The Robinhood Investing platform unfortunately offers a limited amount of securities. On the Robinhood platform, bonds, mutual funds, and index funds are not supported.
Robinhood also lacks a dividend reinvestment plan (DRIP) feature. DRIP gives investors the ability to automatically reinvest dividends they are paid into more of that asset’s stock.
Robinhood has mentioned that they are working to develop a dividend reinvestment plan within their platform and hope to be able to offer it in the future.
Robinhood also only offers one account type, which is an individual taxable account. These are often referred to as brokerage accounts. This means that if you are looking to make a retirement account you will need to use a different provider.
Robinhood also does not offer customer support through the phone like other companies do. This is one of the ways that Robinhood cuts their costs. It is worth mentioning that Robinhood has an easy-to-use and organized customer support center online.
Robinhood Investing Review
The Robinhood Investing platform may not have all of the extensive features that some other online brokers provide, but it serves as an affordable and functional investing platform that allows you to easily manage your investing account.
Also, Robinhood is making efforts to improve their research offerings to users. Robinhood now offers: analyst ratings, top movers, earnings calendars, earnings calls, candlestick charts, popular stocks, and “People Also Bought”.
As we have talked about, Robinhood offers commission-free trades which allow you to get the most out of your investments. Investing within the app or the website is a breeze, and should not be too much of a challenge, even for people who are new to investing.
Robinhood also offers new users a free stock if you sign up for an account. There is also no minimum deposit required to get your free stock. This makes it even more rewarding to sign up for Robinhood. Just use our link below to earn your free stock today, and happy investing!
Earn a free stock when you use the link below to sign up. No minimum deposit required.