Author: Mike Davis
Robinhood was established in 2013 and it is regulated by the top financial regulators in the U.S. The software is a unique investing app that offers commission-free stock trading. You can buy and sell stocks without paying a single penny in commission fees. Robinhood is perfect for investors who are looking to cut costs.
Since the app is completely commission-free, you’ll be able to save money while trading your desired stocks. Robinhood added cash management in addition to its brokerage offering to enable customers to earn interest on unspent money.
But that’s not all Robinhood has to offer, the app also comes with a suite of features that will help you manage your investments like a pro.
How Does Robinhood Work?
First, download the app, sign up for an account, and link it to your bank account. Then you can start investing in stocks, ETFs, and options.
Furthermore, Robinhood helps you to track your portfolio and shows how your investments are performing.
Overall, Robinhood is a great option for people who want to invest in stocks without paying high fees.
Range of Services
Robinhood offers trading in stock, options, EFTs, and cryptocurrencies. However, there are restrictions. You cannot trade commodities, foreign exchange, or futures.
Also, it doesn’t offer fixed-income products or mutual funds. The following are investment options available for you if you decide to use Robinhood as your broker.
- Long stocks, nothing short sold
- Fractional share orders are available for shares of stocks with a market value greater than $1 and a market capitalization greater than $25,000,000. Both stocks and ETFs are available through the broker.
- Options for single and multiple legs
- Cryptocurrency: Bitcoin Cash (BCH), Bitcoin (BTC), Dogecoin (DOGE), Bitcoin SV (BSV), Ethereum Classic (ETC), Ethereum (ETH), and Litecoin (LTC)
As stated earlier, no fixed income, mutual funds, futures, foreign exchange, or futures options.
Robinhood Cash Card Earn weekly rewards as you spend
This is a new feature that lets you earn rewards as you spend. Here is how it works:
Every week, you’ll get a cash bonus based on your spending. It is a great way to save money on the things you buy every day.
Also, a Robinhood Cash Card is connected to your Robinhood account, so you can easily transfer your rewards to your brokerage account. It’s a great way to boost your savings with no annual fee whatsoever.
Who Robinhood Is For?
The simple answer is that Robinhood is for everyone but it favors young investors that are new to the industry.
Over 6 million people have signed up on the Robinhood app. That’s because Robinhood eliminates the barriers that used to exist between people and the stock market.
Now, you don’t have to be a financial expert to invest with Robinhood. All you need is a smartphone and some spare time. And once you’re signed up, you can start trading stocks, options, and cryptocurrencies like Bitcoin and Ethereum.
Where Robinhood Shines
Robinhood is a relatively new player in the investing game, but they’ve quickly made a name for themselves with their innovative approach and low-cost fees.
The application is super easy to use, even for someone who’s not tech-savvy. Furthermore, their free cryptocurrency trading is a major bonus.
Overall, Robinhood is a great option for new investors looking to get started without spending a lot of money.
Where Robinhood Falls Short
Even though Robinhood is a great app, you can’t use it to save for retirement, invest in mutual funds or bonds.
- Users can sign in using a bespoke pin, facial or fingerprint identification, or both. Robinhood advises users to set up two-factor authentication.
- In cases where two-factor verification is not set, new logins from unknown devices may require confirmation with a six-digit key that is sent by email or text.
- Within the last four years, data breaches have been reported by Robinhood. The most recent occurred in 2021 and affected more than 5 million client accounts without causing these accounts any financial damages.
Is Robinhood Perfect for you?
So is Robinhood the perfect investing app for you? That depends on your goals and your experience level.
If you’re a beginner investor, Robinhood is a great way to get started. It’s easy to use, and there’s no minimum deposit required. Furthermore, you can buy and sell stocks, options, and ETFs without paying any commission fees.
However, if you are looking for a more sophisticated investing platform with more features, Robinhood may not be the right choice for you.
After reading this review, we hope you have a better idea of what to expect from Robinhood. Overall, Robinhood is a user-friendly app with competitive rates and a wide selection of investment options. There may be some drawbacks, but for the most part, this app is a great choice for new investors.