Which investment platform must you use? Whether you’re recent to investing and searching at exchange traded funds otherwise you’re considered one of the advanced traders that’s been across the block just a few times, you might be comparing Charles Schwab vs Robinhood and wondering if either option is correct for you in your investment journey.
Charles Schwab is a respected name within the financial sector, with a long time of experience serving investors at every level. Robinhood is a relative newcomer. Each platform has its unique features and advantages, and every appeals to an audience of investors—although not necessarily the identical audience.
On this Schwab vs Robinhood review, we’ll cover the whole lot it’s essential to know to determine which platform is best to enable you to achieve your investment goals. We’ve included details about each company, with detailed details about features, fees, the user experience, and which variety of investor is more than likely to learn from using it.
By the point you’ve finished reading, you’ll give you the option to judge the facts and make a alternative about whether you ought to use Robinhood or Charles Schwab as an investment platform.
Overview of Charles Schwab and Robinhood
Before we get into the main points of what Robinhood and Charles Schwab should offer, let’s review each company’s history and get an outline of what it’s best to expect.
Charles Schwab
Charles Schwab Corporation relies in the US and was founded in 1971 by Charles R. Schwab. It’s a multinational financial company that gives a broad array of services, including:
- Banking
- Business banking
- Investment services
- Wealth management
Through the years, the corporate has made plenty of notable acquisitions, with probably the most recent being their purchase of TD Ameritrade in October of 2020. In addition they recently moved their headquarters from San Francisco, CA, to Westlake, TX.
All investing involves risk, but as of December of 2024, Charles Schwab has $9.74 trillion in assets under management, making it considered one of the biggest and most influential brokers on this planet. The corporate is a member of FINRA and controlled by the SEC.
Robinhood
In comparison with Charles Schwab, Robinhood is a relative newcomer on this planet of investing. The corporate is a licensed broker-dealer and a member of the SIPC.
Robinhood Markets, Inc. was founded in 2013 by Vladimir Tenev and Baiju Bhatt in Menlo Park, California. The mobile trading app for which the corporate is best known was launched in early 2015 with a waiting list of about 214,000 investors.
When the app first launched, Robinhood users could invest only in stocks and ETFs. By the point they announced that they’d be adding cryptocurrency, they’d accrued a wait list of two million people, and had the identical number waiting for the launch of their crypto wallet.
The thing that sets Robinhood apart is that it was the primary commission-free trading app. It’s designed to be easy to make use of and approachable for beginner investors.
Pro Tip:
Enroll with Robinhood today! You possibly can refer friends to earn as much as $1500 per 12 months in FREE STOCK!
| Charles Schwab | Robinhood | |
| Assets available | Stocks, ETFs, bonds, mutual funds, money market funds, options, index funds, Forex, cryptocurrency ETFs, futures, and more. | Stocks, ETFs, options, cryptocurrencies, and ADRs. |
| Cryptocurrencies available | Exposure to cryptocurrency through ETFs and mutual funds; no cryptocurrency spot trading. | 20 |
| Mobile app features | Price alerts; charting; options alerts; trade tickets; digital and video references for learning | Stock, ETF, and crypto trading; limited charting; mobile learning center; 24/7 customer support. |
| Robo advisor? | Yes | No |
| Access to human advisors | Yes | No |
Costs and Fees Comparison
Each Schwab and Robinhood charge fees, and it’s necessary to grasp what the true cost of using each platform might be before you select one to try.
We’ll start with Schwab. Here’s how their fees break down.
- 0% commission for online trades
- $25 service fee for broker-assisted trades
- $0.65 trading fee for options
- US OTC equities: $6.95 fee
- $2.25 per contract for futures and future options
- Mutual funds: as much as $74.95 per purchase
- Spread fee applies to Forex
- $6.95 fee for trades on the Canadian Stock Exchange
- $50 foreign transaction fee
- Secondary trades including CDs, bonds, government agencies and others have a fee of $1 per bond with a $10 minimum and a $250 maximum
Along with these fees, there might be regulatory fees which might be passed on to you. Service fees might also apply to certain trades in the event that they’re broker assisted. Yow will discover Schwab’s full fee table here.
Robinhood’s fee structure isn’t as extensive because there are fewer asset classes available and no broker assistance. Here’s the way it breaks down.
- 0% commission for online and mobile trades
- $0.50 per options contract ($0.35 for Robinhood Gold members)
- Margin trading fees range from 6% right down to 4.95% based on volume
- Outgoing wire fee is $25
- Outgoing ACAT fee is $100
Here again, regulatory fees apply. All fees are disclosed on the time you make a trade. View all the main points here.
Pros and Cons of Charles Schwab vs Robinhood
Listed here are some pros and cons of every platform to think about, starting with Charles Schwab.
Pros
- Comprehensive investment options include stocks, ETFs, bonds, mutual funds, cryptocurrency assets, futures, Forex, and rather more.
- Commission-free online trading
- Flat fee of $25 for broker-assisted trades
- SchwabSafe security suite
- Trade online or via mobile app
- Choice to self-direct investments, use the robo advisor, or work with a broker
Cons
- Overall, fees are higher than Robinhood and another trading apps
- The user experience isn’t as intuitive because it might be
- Cryptocurrency spot trading isn’t available
- No crypto wallet
- Low rate of interest on uninvested money
Listed here are a number of the pros and cons of Robinhood for you to think about.
Pros
- User-friendly interface ideal for beginners
- Commission-free trades
- Can trade stocks, ETFs, and 20 different cryptocurrencies
- Customer support is offered 24/7
- State-of-the-art security measures
- IRA matching funds (1% without cost users, 3% for Robinhood Gold)
Cons
- Bonds, mutual funds, and other asset classes which might be useful for diversification are usually not available
- No robo advisor or brokerage support is offered
- Limited charting and investment tracking options
Pro Tip:
Enroll with Robinhood today! You possibly can refer friends to earn as much as $1500 per 12 months in FREE STOCK!
Schwab vs Robinhood: User Experience Comparison
One of the necessary things to think about when selecting an investment service is what it should be prefer to use it. Here’s our breakdown of the user experience for every.
Charles Schwab has received mixed reviews from users. Many praise the incontrovertible fact that it’s a “real” brokerage, even though it’s worthwhile to keep in mind that Robinhood can also be a registered broker-dealer. Praise is usually related to the variety of assets available. Some users have complained that it’s harder than it needs to be to withdraw money. We expect the interface is sweet, but possibly not ideal for beginners.
Robinhood has put lots of money and time into creating an optimal user experience. Each the net and mobile platforms feature streamlined menus that make it extremely easy to initiate and complete trades. The benefit of use and low fees are sometimes praised in reviews. Probably the most common complaints include sometimes-slow support response times and the dearth of diverse assets to simplify portfolio balancing.
Which Platform is Right for You?
On the entire, we feel that Robinhood is the clear winner for starting investors. Its streamlined interface and intuitive platform are perfect for people who find themselves just getting began with investing and need to give you the option to leap in and begin trading immediately.
Robinhood may not offer the identical variety of assets for trading as Charles Schwab, but it surely’s easier to make use of. Once your account is about up, you may start trading immediately.
When you’re a more experienced investor and you would like access to diversified investments including bonds, mutual funds, and Forex, then Charles Schwab might be the better option for you. While beginners could also be overwhelmed by the alternatives, those that are serious about investing will get well results from Schwab.
Pro Tip:
Enroll with Robinhood today! You possibly can refer friends to earn as much as $1500 per 12 months in FREE STOCK!
Conclusion
Once you’re on the lookout for an investment platform to make use of, it’s best to consider your experience level, investment interests, costs, and the general user experience of every platform.
As a beginner, it’s easy to get your feet wet and begin trading with Robinhood. Their interface is so intuitive that even someone who’s never invested before can jump in and begin trading immediately. More experienced investors will appreciate Charles Schwab’s wider array of investment options and portfolio management tools.
If you ought to know more about how Robinhood compares to a different online-first competitor, take a look at our recent review: INTERACTIVE BROKERS VS ROBINHOOD
FAQs
Is Charles Schwab higher than Robinhood for beginners?
We expect Robinhood is the better option for beginners because of its intuitive interface and streamlined user experience. It doesn’t offer as many trading options, but users can start easy and work their way as much as more complex trades.
Does Robinhood charge any hidden fees?
Robinhood doesn’t charge hidden fees, but it may be difficult to find out how much a trade will cost beforehand. The excellent news is that Robinhood will disclose all fees to you within the trade box and you may review them before you finalize a trade.
Are each platforms secure to make use of?
Yes, each platforms are secure to make use of. Each use encryption, two-factor authentication, and other security measures to be certain that users’ assets and deposits are protected. Also, each Robinhood and Charles Schwab have insurance.