Investment platforms and apps are a dime a dozen. A cursory search of any app store reveals a whole lot of decisions. 

Robinhood is some of the popular investing apps and it’s possible you’ll be wondering: Is Robinhood good for investing? It’s a very important query to ask because every app has its advantages and features.

We’ve got your back as you choose whether Robinhood is true for you. It’s a beginner-friendly investment app that’s popular and free to download. On this review, we’ll run through the fundamental details about Robinhood, including its features, how it really works, and whether it’s the perfect platform for beginners and casual investors.

Is Robinhood price it? Keep reading to search out out.

What’s Robinhood and How Does It Work?

Before we reveal if Robinhood is sweet for investing, let’s speak about what it’s and the way it really works. Robinhood Markets, Inc. is a financial services company that was founded back in April of 2013 by Vladimir Tenev and Baiju Bhatt. Their goal was to create a mobile trading app that was free and straightforward to make use of. The app itself went live in early 2015.

Probably the most essential features of Robinhood is that it offers fast deposits and commission-free trading, something that modified the investment industry. Its mobile-first design and accessibility set off a wave of fin tech innovation that has made investing easy for investors at every level to take a position without normal trading costs. 

From the start, Robinhood users have been in a position to buy and sell stocks and exchange traded funds (ETFs). In 2018, the corporate added a number of select cryptocurrencies to its list of obtainable assets. Since that point, they’ve expanded the variety of digital assets available. As of December 2024, 40 cryptocurrencies can be found including Bitcoin, Ethereum, Litecoin, Solana, and USDC.

Along with the free Robinhood platform, the corporate also offers a premium subscription service called Robinhood Gold. The worth is reasonably priced at just $5 a month or $50 for an annual subscription, although there have been some recent indications that the value may increase to $75 per 12 months. A few of the perks of Gold membership include higher APYs on uninvested deposits and better IRA matching than with the fundamental membership.

Listed here are a number of the key features of Robinhood.

• Commission-free trading 
• Option trading
• User-friendly, intuitive interface
• Trade stocks, ETFs, and cryptocurrencies
• IRA with 1% matching (3% for Robinhood Gold)
• APY of 4.25% on uninvested money with Robinhood Gold
• 24/5 stock trading
• Free stock whenever you refer friends to Robinhood
• Easy deposits
• Educational resources

Robinhood’s interface is one in every of the app’s best features, outside of Robinhood Gold. What Robinhood doesn’t offer are mutual funds or bonds, the dearth of which might make portfolio diversification a challenge.

Take into accout that while Robinhood is commission-free, there are some fees involved with trading. Deposits in your Robinhood spending account are insured by the financial industry regulatory authority, FDIC, as much as $250,000.

Pro Tip:

Enroll with Robinhood today! You may refer friends to earn as much as $1500 per 12 months in FREE STOCK!

Is Robinhood Good for Stocks and Beginner Investors?

Is a Robinhood brokerage account an excellent approach to invest for beginners? We consider that it’s, so let’s review what we like about it.

All of it starts with the user interface, which may be very easy to know and navigate. There are some investment tools that we could point to which have cluttered home pages and an enormous learning curve. That’s not the case with Robinhood. Establishing an account takes just a number of minutes and you possibly can start trading immediately. In other words, there’s a really low barrier to entry.

On a related note, Robinhood provides a free education center on the app where yow will discover slideshows to show you about Bitcoin or investing myths, and articles from reliable investment sites akin to Barron’s and MarketWatch.

One other thing that makes a Robinhood IRA an excellent selection for beginners is that there aren’t any account minimums. You don’t need a great amount to take a position. Likewise, you don’t have to buy a full share of a stock or ETF to take a position in an organization, because Robinhood allows users to purchase fractional shares, without worrying about Robinhood Financial’s fee schedule.

The strategy of investing is easy and intuitive. That’s useful for beginner or casual investors, but will not be ideal for advanced or high-volume investors. Listed here are a number of potential downsides for investors who’ve been across the block.

• Lack of advanced trading features: for instance, there’s no day trading and no commodity trading
• Limited investment options: as mentioned above, you possibly can’t buy mutual funds or bonds on Robinhood
• Limited research tools: while there are some articles and other educational materials, Robinhood isn’t the best place to conduct in-depth research on potential investments

Our takeaway is that Robinhood is a terrific app for people who find themselves taken with self-directed trading with uninvested money and investing and don’t need much in the way in which of advanced tools. It’s probably not the perfect selection for skilled or high-volume investors in search of an all-in-one tool that enables them to research and spend money on a big selection of assets.

Pro Tip:

Enroll with Robinhood today! You may refer friends to earn as much as $1500 per 12 months in FREE STOCK!

Robinhood Plans and Performance

Robinhood has been popular from its start. Before it even launched in 2014, there have been greater than 314,000 people on the waitlist. As of 2022, Robinhood had 10.8 million energetic users. 

In 2023, Robinhood generated $1.86 billion in revenue and had $89 billion in assets under management as of the second quarter. It’s price noting that the corporate experienced an annual net lack of $540 million that 12 months. 

Robinhood offers several plans. These include:

• Robinhood’s basic service
• Robinhood Gold
• Robinhood Legend

We’ve already talked in regards to the first two. Robinhood Legend is a free, desktop trading platform for advanced investors. It provides more in-depth research and evaluation, advanced charting, reduced trading fees, and way more. The platform itself is free to make use of.

Is Robinhood Value It for You?

Now it’s time to reply the burning query: Is Robinhood price it for you? Chances are you’ll be wondering the way it compares to other platforms.

• Robinhood is free to make use of unless you subscribe to Robinhood Gold
• Robinhood never charges commissions, but another platforms do
• Robinhood has a user-friendly interface, while another investment platforms don’t make it as easy for brand new investors to start. Examples include Webull, which has an interface that’s clearly designed for more sophisticated investors.

When it comes to investment experience, here’s how we’d break down the suitability of Robinhood.

• Long-term investors, particularly those that don’t have an employer-sponsored and matched retirement account, may prefer Robinhood since it’s easy to open an IRA and make the most of matching.
• Day traders may prefer other platforms since Robinhood’s basic program doesn’t include advanced trading tools. Nonetheless, using Robinhood Legend could also be an option.
• Latest and casual investors are likely to search out Robinhood’s accessibility to be a profit and should prefer it to other platforms.

Robinhood is an excellent option for investors who don’t want to interact in complicated trades, including day trading. While it is feasible to interact in option or future trading, Robinhood doesn’t have the perfect tools and research options for these complex trades.

Expert Suggestions for Getting Began on Robinhood

If you would like to give Robinhood a try, listed here are some expert tricks to aid you profit from the platform.

1. Start with a small amount and construct from there. Among the best things about Robinhood is that you just don’t need a variety of money to start, so we recommend being cautious at first and giving yourself time to get used to the method before increasing the quantity you invest.
2. Benefit from fractional shares. Robinhood allows all users to purchase fractional shares, and meaning you possibly can spend money on firms you want and care about even should you don’t manage to pay for to purchase a number of full shares.
3. Use Robinhood’s educational section (under “Learn” on the menu) to get acquainted with investment concepts, asset classes, and specific firms to take a position in. We recommend staying open to recent ideas and taking the education aspect of investing seriously if you would like to maximize your returns.
4. Diversify your portfolio to attenuate your risks. A diversified portfolio should include stocks and ETFs in several industries and sectors, bonds, mutual funds, and even cryptocurrency. (Take into accout that Robinhood doesn’t currently allow users to take a position in bonds or mutual funds, so that you’ll have to go elsewhere for those.)
5. Don’t invest more in cryptocurrency than you possibly can afford to lose. It’s essential to keep in mind that crypto is much more volatile than other asset classes.
6. Create custom price alerts to be notified when one in every of the investments in your portfolio experiences a drop or increase in price.
7. When you don’t have already got a retirement plan, arrange an IRA on Robinhood to make the most of 1% matching for the fundamental platform and three% for Robinhood Gold.

These pro suggestions can aid you profit from Robinhood’s features whilst you find out about investing and construct your portfolio.

Pro Tip:

Enroll with Robinhood today! You may refer friends to earn as much as $1500 per 12 months in FREE STOCK!

Conclusion

Robinhood modified the fin tech industry when the app launched in 2015 and it continues to be popular. Using the fundamental app, it’s easy to create and fund an account, initiate trades, and find out about investing. You too can get matching funds in your IRA, and Robinhood never charges commission for trades.

Our take is that Robinhood is good for starting and casual investors who need a quick and intuitive approach to start investing and construct a portfolio. It’s not the perfect selection for advanced investors who’re trading at high volumes or intend to make more complex trades.

FAQ

Is it price investing in Robinhood?

Yes, we predict it’s worthwhile for each beginners and casual investors. Robinhood’s intuitive interface and streamlined user experience make it easy for users to fund their accounts, buy investments, and track their portfolios.

Are you able to really earn cash on Robinhood?

Yes, you possibly can earn cash on Robinhood in quite a lot of ways. You may earn returns in your investments, get matching funds in your IRA, and even earn interest in your deposits. Chances are you’ll also qualify free of charge stocks whenever you refer your pals.

Does Robinhood charge hidden fees?

Robinhood touts the indisputable fact that it offers commission-free trading. Nonetheless, it doesn’t offer fee-free trading. A few of the fees that could be charged include regulatory fees, OCC fees, and repair fees. It is best to all the time review the fees before finalizing any investment. Most of those fees are only a number of cents and a few are waived for purchases of fewer than 50 shares.

Is Robinhood secure for investing?

Yes. Robinhood deposits, including investment accounts and IRAs, are protected by SIPA as much as $500,000. Robinhood spending accounts are insured by the FDIC, and Robinhood has purchased additional insurance for losses to guard users. Robinhood accounts are password-protected and two-factor authentication (fingerprint scan and codes) is enabled. The app and website are encrypted and guarded, as well.