Are you a frequent trader and can’t really find a way of investing while avoiding the high commission fees? Then listen up! I was in the same position as you are now before I found out about Robinhood, and that’s why I wanted to write this review!
I was constantly trading, and the commission fees required per transaction started to become a burden. I was looking for a long time for a system that would allow me to freely trade stocks, options, and cryptocurrency from my mobile phone.
Well, Robinhood’s commitment and idea do really work! For me, the ability to avoid commissions meant that I could save a significant amount of money! If you want to know more, read on for an honest review (you will find some cons next to the pros) of Robinhood!
Who is Robinhood for?
Do you tend to trade stocks, EFTs, and cryptocurrency often?
Are you a frequent investor that would like to see your money go further?
Do you have a fast-paced lifestyle that does not allow you to spend a large amount of time in finding the perfect platform?
Robinhood is created to offer a 100% commission-free trading system that can really make frequent traders save important capital on transaction fees. Moreover, the app is incredibly easy to use, and investing can be done in minutes. This makes it perfect for anybody willing to complete a transfer quickly from their smartphones.
Overview – Robinhood
So, you would like to start trading through the Robinhood platform, but you are not sure about its specifics? Ultimately, it is your money that we are talking about, so you should be asking questions! I have done the same, and then tried the app, and this is what I discovered!
Aside from being reassured that Robinhood is a pioneer of commission-free trading, these are the features you should be expecting when signing up.
1. No account minimum
Robinhood does not have an account minimum, which makes it extremely investor-friendly. You will be able to start trading immediately after signing up and deciding which investment you would like to aim for.
2. Quick funding
If you are reading this page, you are probably looking for a better option than our current trading platform. So you know that to start trading, you have to have enough funds in your brokerage account to start trading. Well, with Robinhood, you can move up to $1000 in your account immediately after signing up. Trading is so easy on this app!
3. Commission-free trading
This is potentially the most looked after benefit Robinhood offers to investors and traders. It is true that there are other platforms that allow you to trade stocks or EFTs for free. However, Robinhood does it all. Not only you can exchange stocks and EFTs, but also cryptocurrencies and options, and totally for free! This is arguably the main advantage for frequent traders, as you know better than me how high a commission fee bill can get! Robinhood’s services are unique in the field.
4. Low associated costs
Robinhood is committed to lowering the investment costs as much as possible. We have already seen that there are no commission fees for any transfer, but also the platform avoids any annual, inactivity, or ACH transfer fees. The only cost that you might face while using the app is a $75 ACAT outgoing transfer fee.
5. Robinhood Gold
Last but not least, Robinhood will allow you to buy securities with borrowed money! This program is optional and takes an unusual approach, but is appreciated by investors. While it can be risky, the program can be very appealing if you are a more expert trader. The service is offered in exchange for a fee. This price is monthly and based on how much you have borrowed.
The Robinhood trading platform aims at encouraging new investors to get in the game. For frequent and more expert traders, Robinhood reserve some appealing options too!
Overview of the App
As we have seen above, one of the main unique selling points of the Robinhood platform is its app. This is designed to be used with extreme ease by any type of investor and at any point during the day. I can trade stocks in minutes from anywhere!
However, you might have seen a few brokerage platforms already, and you feel like there is no need to get into another one. Let me tell you – this is not the case of Robinhood! The mobile app offers a completely innovative interface and features that set it in a different category.
Let’s have a look at what to expect when you launch the Robinhood app on your smartphone!
- It is easy to use! – The main difference I found between the platforms I had been using and Robinhood is that the last one runs mainly through an app. There is no need for a webpage, as the application is incredibly intuitive and easy to use.
The guys behind the Robinhood app really understood the app’s target market and created an appealing option for people, like me, that prefer to complete some trading just by using their fingertips.
- Easy to set up and fund – The signing up process, as well as the verification procedures, can be completed in a few simple steps by anyone. Everything you need to do is answer the security questions regarding personal and contact details and Social Security numbers.
It took me less than five minutes to complete this project and fund my account. Applications are often accepted within 24 from the submission, and then you can start trading!
- A cleaner, simpler app – When I first started trading, I was incredibly intimidated by the number of lines, graphs, numbers, and abbreviations. That is why I picked Robinhood!
The app cut out on anything extra, so it is very easy to navigate, even for first-time investors. The information given by the app’s pages is the essential one you need to define that particular stock: high, lows, dividend, and market cap.
Moreover, if you are not sure at what level you are on, the app analyses your own account: it does tell you your buying power, portfolio, account, and management options.
That is really everything you need to know!
- Search options – with a smoothly-working search bar on the top, you will be able to see all the main information regarding a specific stock in a moment. This is perfect for more expert traders that know what they are aiming for. You will be able to place market orders, limit orders, stop-limit orders, and stop orders.
Moreover, Robinhood is one of the first apps to introduce a “collection” feature. If you are not sure where to invest, you can search for groups of stocks depending on what feature attracts you the most. For example, you will be able to identify companies with a female CEO or in a specific industry. This is the perfect option for newer traders!
The “Robinhood” app is available on the Apple App Store and Google Play Store, and the notifications can be pushed even to your Apple Watch. Moreover, you will be able to find customizable alerts and news feeds to be ready when the right opportunity comes along. The last benefit I saw from the app was that I could listen to live earnings calls.
Robinhood: At a glance
- Account minimum balance: $0 (none)
- Stock trade fee: $0
- Option trade fee: $0
- ETFs: commission-free (2000+)
- Other account fees: $75 transfer out fee
- What can you trade? Stocks, ETFs, options, cryptocurrency
- Who can you speak to? The customer service is reachable through email (Monday to Friday) and chatbot.
Pros and Cons of Robinhood
- Commission-free trading: Arguably, the most looked after advantage, Robinhood allows you to trade stocks, EFTs,
- options, and cryptocurrency without a transaction fee.
- Options free trading: Robinhood is one of the first platforms to offer this alternative.
- Perfect for frequent traders: The no commission trading suits even the most frequent trader.
- Perfect for anybody that prefers using their smartphones for trading.
- No account minimum: this allows you to fund your account and start trading immediately.
- Research and Notification: personalized and free through the app.
- I found the app to be too streamlined: if you are a new trader, the information might not be enough.
- The platform does not offer an option to open retirement, IRA, joint, or education accounts. The only available choice is an individual, taxable account.
- The customer service can be limited.
- Robinhood does not offer an option for mutual funds or bonds.
Wrapping it Up
I am grateful to the Robinhood app as it made it easy for me to understand the basics of trading without having to pay pricey commissions fees.
This platform is generally preferred by anybody just starting off their trading career, rather than by expert investors. However, the commission-free trading offered makes Robinhood an appealing alternative for many traders, experts, or beginners.
Since it is incredibly easy to sign up and free to use, I strongly encourage you to smartphone and download the Robinhood app right now! You will quickly find out that it was the right one for you all along and appreciate its many benefits like I did. Let us know what you think by leaving a comment below!
Blake is a self-made online day trader with a knack for adventure. On his free time, he loves reading and learning new thing as well as improving his jiu-jitsu skills. He currently resides in New York City. Learn More >>