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Robinhood review

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Trade stocks, options, ETFs and cryptocurrency with a simple interface and no commission fees.

finder.com’s rating: 3.5 / 5.0

★★★★★

  • Consider Robinhood if you’re a new or casual investor looking for a beginner-friendly platform.
  • Look elsewhere if you’re a day trader or professional investor.

$0

Stock trade fee

0%

Annual fee

$0

Minimum deposit to open

Details

Intro or bonus offerGet a free stock worth up to $210 when you sign up
Stock trade fee$0
Annual fee0%
Option trade fee$0
Asset typesStocks, Options, ETFs, Cryptocurrency
Account typesBrokerage
Minimum deposit to open$0

Bottom line

Robinhood’s trading platform is a solid jumping-off point if you’re just getting into active investing or want to avoid commission fees. Its target audience includes first-time traders and cryptocurrency investors, offering accounts with no minimums, annual fees or inactivity fees.

But the platform isn’t for everyone. It’s limited by its simple design and lack of access to mutual funds and IRAs. More experienced day traders may want to opt for a platform with more sophisticated research tools.

Fees

★★★★★ 4/5

It offers commission-free trades and account fees are on par with competitors.
Available securities

★★★★★ 4/5

It has four securities to offer, including cryptocurrency.
Customer support

★★★★★ 3/5

Support is only available by email but agents typically respond within a day.
Mobile app

★★★★★ 4.8/5

Robinhood scores high on the Apple App store, but slightly lower on Google Play.
Research and tools

★★★★★ 3/5

You can pay a premium for more robust reporting but free resources are limited.
Reliability

★★★★★ 2/5

Multiple service outages have been reported for this platform.

To learn how our star ratings are calculated, read the methodology at the bottom of the page.

Pros and cons

Pros

  • Intuitive app. The app makes it easy for beginners to get started with trading.
  • Commission-free trading. Robinhood doesn’t charge any commissions or fees to trade.
  • Fast approval. Deposits of up to $1,000 are approved nearly instantly.
  • Cryptocurrency support. One of Robinhood’s major selling points is its cryptocurrency support, as not many platforms offer this feature.
  • No account minimums. You can sign up for free and start trading with any amount.

Cons

  • Limited support. The only way to access Robinhood customer support is through its online ticketing system.
  • Limited investment options. You can’t invest in mutual funds or bonds through Robinhood — something that competitors like Chase You Invest and Ally Invest offer.
  • No IRAs. Robinhood’s account options are limited to individual brokerage accounts, so if you’re seeking an IRA, you’ll have to look elsewhere.

What investments does Robinhood offer?

You’ll get unlimited, commission-free trades across the following investment products:

  • Stocks and funds. Browse over 5,000 available stocks and ETFs, including fractional shares for as little as $1.
  • Options. Explore options trading with no per-contract fees.
  • Cryptocurrency. Buy and sell 17 different cryptocurrencies any time of day, including Bitcoin, Litecoin and Ethereum.

What is Robinhood Cash Management?

The Robinhood Cash Management account offers brokerage account holders the opportunity to earn interest on cash sitting in their account. As of April, 2020, Robinhood is offering 0.3% APY and a free debit card with access to more than 75,000 nationwide free ATMs. There are no associated maintenance fees, foreign transaction fees or account minimums.

Who is Robinhood best for?

Robinhood is designed with the beginner in mind, with commission-free trades, a simple signup process and an intuitive interface. No account minimums mean newbies can open an account with no upfront investment and purchase fractional shares for just $1 apiece.

For advanced investors, Robinhood Gold offers Morningstar research reports, NASDAQ Level II Market Data and instant access to deposits of $5,000 to $50,000 for $5 monthly. But Robinhood’s lack of access to mutual funds, individual bonds and analyst research could be a deal-breaker for more active investors.

With this in mind, Robinhood’s trading platform is best suited to the following types of investors:

  • First-time investors. With no account minimums or commissions in sight, Robinhood’s platform is ideal for beginners looking to explore their trading options.
  • Small quantity investors. Fractional shares allow small quantity investors to purchase shares for as little as $1.
  • Cryptocurrency investors. Cryptocurrency investors can swap digital coins with no commission fees 24/7.

What does the app look like?

Robinhood app homescreen

The Robinhood app is intuitive, with a user interface that’s divided into three main sections:

  1. A home screen that displays the performance of the stocks you own and are watching.
  2. A screen that allows you to join the waitlist for the cash management account.
  3. A browse page where you can search stocks, see top movers and read recent news.
  4. A messages page where you’ll get updates about deposits, dividends and stock purchases.
  5. A profile page, where you can see your account summary, transfer money into your brokerage account, invite friends, upgrade to its Gold tier, get tax documents and help or change your settings.

Before diving into your first trade, explore the app to familiarize yourself with its navigational tools. It can take up to three days for your initial deposit to clear. In the interim, learn the ins and outs of the platform so you can hit the ground running once you’re ready to make your first trade.

How easy is it to use?

One thing Robinhood’s platform really has going for it is its simple design makes it easy to use. Complete the application in a matter of minutes from the Robinhood mobile app or website. Robinhood asks for basic personal information, including your name, residential address, email address, phone number, date of birth and Social Security number. After that, you only need to fund your account.

Robinhood’s platform lacks some of the more complex features of its competitors, opting for an uncluttered interface. But this over-simplistic design comes with clear trade-offs: a lack of resources and in-depth research on the companies you’re investing in, which you might find on more advanced platforms.

What research does it provide?

The free tier provides some basic research to help you stay on top of the market, but seasoned investors and day traders might find it lackluster. You’ll get a feed of news articles about the market and specific stocks and companies from sites like the Financial Post, MarketWatch, Reuters and the New York Times, along with daily information on which stocks are moving the most.

For an additional $5 a month, Robinhood investors can sign up for Robinhood Gold to receive Morningstar and NASDAQ Level II Market Datastock research reports. If you’re looking for in-depth research, you’ll likely want to shell out for the upgrade.

Recurring investments

In May 2020, Robinhood launched a new feature that allows recurring investments. You can choose to have Robinhood automatically invest a set amount of money in a specific stock or ETF on a daily, weekly, biweekly or monthly basis. You can choose the source of funding, like a linked bank account, and the investment will be executed at the market price at noon EST according to the schedule you selected.

Pricing and fees

Robinhood trades have been commission-free since its launch in 2015. Back then, no commission fees were a pretty big deal, giving Robinhood an economical edge over its competitors. But today, many other trading platforms have dropped their commission fees, making it challenging for Robinhood to market itself as a low-cost alternative.

That said, Robinhood has many competitors beat when it comes to per-contract fees for option trades. Where many of its competitors, including Interactive Brokers, TD Ameritrade and Ally Invest, charge between $0.25 to $0.65 per contract, Robinhood offers these trades for free.

Minimum deposit to open $0
Annual fee $0
Stock trade fee $0
Option trade fee $0
Inactivity fee $0
Robinhood Gold $5 monthly
Stop payment fee $9
ACAT outgoing transfer $75

How does the free stock program work?

Robinhood investors have the opportunity to earn free stocks by sharing a referral link on Twitter. For each person you sign up, both you and the new investor receive a free stock.

Available stocks vary, but Robinhood states you have a 1 in 150 chance of receiving Kinder Morgan, Snap or HP Enterprise stock, and a 1 in 200 chance of receiving Facebook, Microsoft or Walmart stock. Stock rewards are limited to a maximum of $500 per user, per year.

Is Robinhood safe?

Robinhood was founded in 2015 with headquarters in Menlo Park, California. It has its own Better Business Bureau (BBB) page but is not a BBB accredited business. It’s registered with the US Securities and Exchange Commission and a member of the Financial Industry Regulatory Authority (FINRA) and the Securities Investor Protection Corporation (SIPC).

How does Robinhood keep my money safe?

Thanks to its membership in both FINRA and SIPC, Robinhood customers are protected up to $500,000, including up to $250,000 in cash balances. Cryptocurrencies are excluded from this protection, as they are not stocks.

Robinhood uses 128-bit encryption to protect your data on its website and mobile app. You can also enhance the security of the Robinhood app by enabling Touch ID, Face ID, a custom PIN code or two-factor authentication.

Robinhood reviews and complaints

Overall, Robinhood’s online reputation is fairly negative. It’s amassed 745 official BBB complaints over the past three years. Here’s how customer reviews stand as of October 2020:

BBB

★★★★★

1.25/5
Based on 87 customer reviews

Trustpilot

★★★★★

1.9/5
Based on 83 reviews

Consumer Financial Protection Bureau 80 complaints

Many recent reviews mention outages associated with the recent surge in trading activity. These outages resulted in Robinhood investors being locked in unfavorable positions, ultimately culminating in the loss of capital. Prior to this, negative reviews called out Robinhood’s limited customer support and delays in the cash withdrawal process. On the upside, customers love Robinhood’s commission-free trades, easy to learn platform and free stock referral program.

Reviews of the Robinhood app are mixed. The app has 4.3 out of 5 stars after 163,413 reviews on Google Play, but maintains an impressive 4.8 out of 5-star rating on the Apple App store after a whopping 2.1 million reviews. Many recent negative reviews on Google Play and the Apple App store cite Robinhood’s 2020 outages.

Robinhood service outages

In March 2020, the Robinhood trading platform experienced three major outages. The shortest outage lasted just under two hours, while the longest took 16 hours to resolve. In a blog post on its website, Robinhood founders Baiju Bhatt and Vlad Tenev explain that the outages were a combination of highly volatile market conditions and a record volume of trading action on the platform.

The founders state that it’s making improvements to shore up Robinhood’s internal infrastructure with reduced interdependencies and added redundancies. While the site has generally been stable since, it did have a short outage on June 18.

How to buy stocks on Robinhood

To purchase a stock on Robinhood:

1. Choose a stock to buy.

Robinhood offers more than 5,000 stocks to choose from. They include not only popular US-based companies, but also exchange-traded funds (ETFs) and global stocks.

2. Select your order type.

When buying a stock, Robinhood allows you to specify the type of order you’d like to carry out:

  • Market. Pay the market price for a share, whatever it is at the time of purchase.
  • Limit. Specify the exact price you’re willing to pay for a security.
  • Stop loss. Executes a market order after the specified stop price is met.
  • Stop limit. Executes a limit order after the specified stop price is met.

You may find a lag when it comes to the real-time prices displayed on your app. This can create a headache for people looking to get the absolute best price on a stock.

3. Indicate the number of shares you want to purchase.

It’s as straightforward as giving the number of shares you’re looking to purchase. Robinhood doesn’t support half orders.

4. Make sure you have enough buying power.

Robinhood recommends transferring funds to your account before purchasing a security on its platform. However, it makes these funds available as soon as you initiate a deposit. This means you’re able to carry out the trade even before the money technically leaves your bank account.

5. Review your order and swipe up to submit it.

Before finalizing your purchase, Robinhood gives you the chance to review your order. Swipe up on the screen to submit, and watch green confetti fall from the top of your screen.
How to find penny stocks on Robinhood

How to sell stocks on Robinhood

Selling stocks on Robinhood is just as painless as buying them. Select the number of shares you’d like to sell, review your order and submit.

How do I contact customer support?

There’s only one way to connect with Robinhood support:

  • Email. Fill out an online support ticket request on Robinhood’s website for an email response from the customer service team.

Compare other stock trading platforms

Name Product Stock trade fee Asset types Option trade fee Annual fee
Vanguard
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$20 per year
Get a personal advisor when you open an account with at least $50,000.
Sofi Invest
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N/A
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A free way to invest in stocks, ETFs and crypto.
Robinhood
$0
Stocks, Options, ETFs, Cryptocurrency
$0
0%
Make unlimited commission-free trades in stocks, funds, and options with Robinhood Financial.
Interactive Brokers
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0%
IBKR Lite offers $0 commissions, and IBKR Pro offers advanced tools for professional traders.
TD Ameritrade
$0
or $25 broker-assisted
Stocks
$0 + $0.65/contract,
or $25 broker-assisted
TD Ameritrade features $0 commission for online stock, but watch out for high short-term ETF and broker-assisted trading fees.
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Frequently asked questions

How we rate trading platforms

★★★★★ 5/5 — Excellent

★★★★★ 4/5 — Good

★★★★★ 3/5 — Average

★★★★★ 2/5 — Subpar

★★★★★ 1/5 — Poor

We analyze top online trading platforms and rate them one to five stars based on factors that are most important to you. These factors include fees, securities available for trade, customer support, customer feedback, platform resources and overall reliability.

For a complete breakdown of how we score each category, read the full methodology of how we rate trading platforms.

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