Robinhood Review
Robinhood provides commission-free stock and crypto trading to US consumers via user-friendly trading applications. They provide trading tools as well as market research.
Robinhood is a renowned online stock broker. The broker has been operating since 2013 and is based in the US. Robinhood means Robinhood Markets and its in-application and web experiences with its family of wholly-owned subsidiaries, including Robinhood Financial, Robinhood Securities, and Robinhood Crypto. Robinhood Financial is a member of the Financial Industry Regulatory Authority (FINRA) and the Securities Investor Protection Corporation (SIPC). Moreover, the company is listed on the New York stock exchange (NYSE: HOOD). Robinhood is regulated by the Securities and Exchange Commission (SEC) of the United States.
Robinhood provides an impressive range of over 5,000 trading products, including various asset classes such as stocks, ETFs, options, and cryptocurrencies. The broker provides commission-free stock trading to US consumers via user-friendly trading applications. In addition, the broker has competitive trading costs and no minimum deposit requirements. Moreover, Robinhood has its proprietary trading platforms with cutting-edge technology to help traders place their trades.
Robinhood provides trading tools as well as market research. The main downside is that the broker has limited education resources and funding options, whilst they can only accept clients from the US.
Robinhood is a strictly regulated online stock broker based in the US. The broker is a member of SIPC and is regulated by FINRA in the US. Robinhood provides commission-free stocks and crypto trading. In addition, the broker provides dedicated market research from Morningstar and Level 2 market data to its clients. The broker offers a very user-friendly mobile trading app and web trading platform with all the necessary features. The broker is also a public company and listed on the New York stock exchange with the ticker: HOOD. Moreover, the broker does not require any minimum deposit to get started. Robinhood also provides investing opportunities via cash management and Initial Public Offering (IPOs) of the newly public companies.
On the other hand, the broker only accepts clients from the US and does not offer popular third-party trading platforms such as MetaTrader or cTrader, which limits the options for some traders who may already be well accustomed with the aforementioned platforms. The broker does not offer demo trading and Islamic accounts. Customer support is only available 24/5 via phone and email during market hours. Plus, Robinhood has limited asset classes and educational and research resources. Moreover, the broker does not offer one of the most popular trading instrument, which is forex. You may refer to our best forex brokers if you are looking to trade forex.
Robinhood provides a vast range of over 5,000 trading instruments from popular asset classes, including stocks, ETFs, options, and cryptocurrencies. However, some traders might find the product portfolio limited as other popular asset classes are not yet offered by Robinhood, including forex, commodities, bonds, indices, and CFDs. If you are looking for a CFD broker with a greater selection, IG have over 18,000 financial instruments in comparison.
Robinhood Instruments Summary
| Instruments | Robinhood |
|---|---|
| Forex | x |
| Stocks | ✓ |
| Indices | x |
| Commodities | x |
| Cryptos | ✓ |
| Options | ✓ |
| Bonds | x |
| ETFs | ✓ |
| CFDs | x |
Commission and Spread Fees
Robinhood does not charge any commission fee or spreads. However, other trading costs include Regulatory Transaction Fee, Trading Activity Fee, and American Depositary Receipt (ADR) Fees.
| Regulatory Transaction Fee | Trading Activity Fee | American Depositary Receipt (ADR) Fees | |
|---|---|---|---|
| Fee | $5.10 per $1,000,000 of principal (sells only) | $0.000130 per share (equity sells) $0.00218 per contract (options sells) | $0.01-$0.03 per share |
Deposit and Withdrawal Fees
Robinhood does not charge any deposit or withdrawal fee.
Inactivity Fees
Robinhood does not incur an inactivity fee from dormant accounts which is great.
Robinhood is accessible on iOS, Android, and the majority of online browsers. Robinhood Web is available for both Mac and PC, and it is compatible with the majority of contemporary web browsers, including Chrome, Safari, Firefox, and Edge.
Robinhood Web Trading Platform
The simplistic Robinhood web platform includes significant discovery and research capabilities to assist investors and traders in making educated trading decisions. I found the platform very easy to navigate with a nice modern look and feel that avoids any unnecessary clutter that you see with some other platforms.
Collections is a feature accessible on Robinhood for Web. Essentially, the function allows consumers to find the most recent stocks. Robinhood arranges assets by categories like social networks, gas and oil, and entertainment to assist traders and investors in locating stocks and interest options. The feature is interactive, making it simple for traders and investors to sort through. Users can also make side-by-side asset comparisons. This makes it simple for them to choose which asset to invest in and which trading method to employ.
Here are the key features of the Robinhood Web platform:
- Discover new stocks by browsing Collections, which are categorised by industries like “Gas and Oil,” “Entertainment,” and “Social Networks,” as well as selected categories like “2017 IPOs” and “Female CEOs.” All Collections are interactive and easily sortable by a variety of criteria, allowing for side-by-side comparisons.
- View the average share price paid by Robinhood investors as well as the current share price for each stock. This aggregated data serves as a starting point for investors considering establishing a position.
- Browse through a list of stocks that Robinhood investors purchased in addition to individual stocks. This function aids in the discovery of rivals, suppliers, and other relevant information.
- View Wall Street analysts’ buy, sell and hold ratings, as well as Morningstar analysts’ commentary.
- Examine earnings data such as EPS hits and misses going back eight quarters, future and forecast EPS, and live earnings calls.
- In a customised newsfeed, you can read the latest headlines and market coverage, as well as look at business basics like Market Cap, Price-Earnings Ratio, Volume, and more.
Robinhood Trading App
The Robinhood App was created by Robinhood for mobile trading, which is getting more and more popular among the younger generation of aspiring traders and investors. The Robinhood app’s success is undeniable, with over 13,000,000 traders. Because authorities forbid Robinhood from catering to overseas clientele, it is solely available to US traders which makes this figure even more impressive. The domestic financial market in the United States is a closed system, with just a few brokers vying for traders. After providing commission-free stock trading and fractional share trading, Robinhood took up a clear leading position among them, along with the like of TD Ameritrade. It allows smaller traders to build a well-diversified portfolio and accepts purchases as low as $1. Because new traders may benefit from it, the Robinhood App is becoming increasingly popular among first-time traders.
The Robinhood trading platform is simple and straightforward to use, making it simple to buy and sell stocks, ETFs, and cryptocurrencies. However, the platform suffers from restricted order kinds and a lack of extra bells and whistles. Most brokerages provide a variety of techniques for tracking market activity. Unfortunately, Robinhood does not include notifications, an AI assistant, a portfolio builder, a trading simulator, heat mapping, a short finder, or screeners, all of which are prevalent on competing brokerage platforms.
Robinhood does have a simple watch list tool, which lets you follow the assets you’re most interested indirectly from the main page of the Robinhood mobile app. The app also employs push notifications to notify users of breaking news and major articles that may have an impact on the market.
In addition to the watch list, Robinhood provides “cards” that inform customers about new Robinhood features; transaction information, such as orders, dividends, and pending transactions; market changes, and breaking news updates about anything related to the financial markets. Users of Robinhood may access news pieces and videos regarding particular companies as well as the market in general from sources such as the Wall Street Journal, Reuters, Barron’s, CNN Business, Cheddar, and Reuters. If you go to a specific stock in the app or online client, you can access current news pieces about the stock from the same sources.
Although there are no customisable charting options, Robinhood does include candlestick, line, and volume charting for all stocks available for trading on the mobile app and online, as well as indicators for volume, multiple moving averages, and the relative strength index.
While most smartphones have more than enough computer capability, the fundamental reason professional traders do not utilise mobile phones for trading is the screen size. Because millennial traders are less concerned with performing research and more concerned with purchasing shares that remain hot on social media, the Robinhood App provides this. The broker confirms that the trading operations serve a supplementary function.
Robinhood Platforms Summary
| Platform | Robinhood |
|---|---|
| MetaTrader 4 (MT4) | x |
| MetaTrader 5 (MT5) | x |
| cTrader | x |
| Proprietary | ✓ |
| Desktop | x |
| Web | ✓ |
| Mobile | ✓ |
| Social Trading | ✓ |
| Other | x |
Though Robinhood’s research capabilities currently lag behind those of rival brokers, the business has made steps to expand the tools and research available to users, including analyst ratings, lists of top movers, earnings calendars, and connections to earnings calls. Candlestick charts are available on smartphones, and the service resurfaces data from other Robinhood clients to build its own universe of data. For example, users may browse the platform’s 100 most popular companies and rank them based on a variety of factors. They will also get access to recognised news sources such as The Wall Street Journal Markets, Reuters, Barron’s, and CNBC Business.
Robinhood partners with Morningstar to provide expert research, giving consumers unrestricted access to in-depth analysis and research reports on over 1,700+ companies. The Robinhood platform also includes a number of built-in features for market analysis, order management, and alerting. The Robinhood website has a section dedicated to learning, with a collection of often updated and educational articles covering a wide range of financial subjects for both novice and expert traders. The writers are well-known, having had work published by the Wall Street Journal, Forbes, and Bloomberg, to mention a few.
The Robinhood newsfeed may be accessed from within the app. It provides free market news coverage from The Wall Street Journal, Reuters, and Barron’s in collaboration with Dow Jones. You may read news headlines from reputable news organisations, including those related to your investment portfolio and watchlist. Notifications can be established for stocks in your portfolio and watchlist. There are also ad-free videos presented straight in your feed from CNN Business, Cheddar, and Reuters.
However, on the downside, Robinhood does not provide dedicated third-party research tools such as Trading Central, AutoChartist, Economic Calendar, and trading ideas. If you are looking for more trading tools to assist you with your trading strategies, Oanda have a great selection. Robinhood has a small “Learn” section with three subsections. Let’s look at each educational resource briefly.
Investing Basics
This section comprises basic information about investing and trading on the platform. There is nothing too ground breaking here but it could prove to be useful if this is your first venture into online trading.
Library
This section has a series of written and video guides to help beginners learn. There is a decent amount of content for you to peruse at your leisure.
Snacks
This section provides the latest market news that can shape the future of a market. They are called “snacks” as they are easy to digest without being too overwhelming.
Robinhood Research and Education Summary
| Resources | Robinhood |
|---|---|
| Market Analysis | ✓ |
| Guides | ✓ |
| Videos | ✓ |
| Webinars | x |
| Autochartist | x |
| Trading Central | x |
| Economic Calendar | x |
| Other | x |
Robinhood has only one payment method, which is bank (wire) transfer. Unfortunately, the broker does not offer any other payment option such as credit/debit cards, e-wallets, or cryptocurrencies. If you are looking for a better selection of methods for making deposits and withdrawals, Forex.com have a decent selection.
Robinhood Funding Summary
| Payment Method | Deposit | Withdrawal |
|---|---|---|
| Wire Transfer | ✓ | ✓ |
| Credit/debit Card | x | x |
| Electronic Wallets | x | x |
| Cryptos | x | x |
Robinhood Financial is regulated by the Financial Industry Regulatory Authority (FINRA). In addition, Robinhood is regulated by the Securities and Exchange Commission (SEC) of the United States.
Robinhood Regulation Summary
| Regulator | Robinhood |
|---|---|
| ASIC (Australia) | x |
| IIROC (Canada) | x |
| CySEC (Cyprus) | x |
| SFC (Hong Kong) | x |
| JFSA (Japan) | x |
| MAS (Singapore) | x |
| FINMA (Switzerland) | x |
| FCA (UK) | x |
| CFTC (USA) | x |
| Other (FINRA) | ✓ |
Robinhood Safety
Robinhood Financial LLC is a member of the Securities Investor Protection Corporation (SIPC), which ensures its members’ securities clients up to $500,000 (including $250,000 for cash claims).
Cryptocurrency trading is available with a Robinhood Crypto account. Robinhood Crypto is not regulated by the Financial Industry Regulatory Authority (FINRA) or the Securities Investor Protection Corporation (SIPC). Neither the FDIC nor the SIPC provides protection for cryptocurrency assets.
Robinhood’s customer service is available by email and phone 24/5 during market hours. I think they could improve by extending support hours to weekends in order to keep up with other brokers such as Plus500.
Robinhood provides commission-free stock trading using user-friendly and adaptable trading platforms. They provide several excellent trading tools that may help with market research and keep up with the newest economic news happenings. However, their services are currently restricted to the United States and the range of financial products offered is limited when compared to competitors. They could also implement support for some additional funding methods.
