Robinhood App Review 2024: User-Friendly Stock Trading

Explore the user-friendly stock trading app with commission-free trading, fractional shares, and a unique IRA match. Learn more about how Robinhood works and if it's the right investing app for you. Invest in thousands of stocks, ETFs, options, and crypto without paying commissions.

We’re diving into Robinhood, the user-friendly stock trading app with commission-free trading, fractional shares, a unique IRA match, and the cleanest user interface that both new and experienced investors can appreciate.
Robinhood
Robinhood
★★★★☆ | 4.2 / 5
 
User-Friendly
Commission-Free Trades
3% IRA Match
No Automated Portfolios
 
Whether you want to invest in thousands of stocks and ETFs or trade options and crypto without commissions, Robinhood has features for investors of all experience levels.
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The app is easy to use, feature-packed, and lets anyone get started investing in the stock market with just $1.

Video Summary

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Key Takeaways

  • Invest in stocks, ETFs, options, and crypto without paying any commission fees.
  • Robinhood’s user-friendly interface caters to both beginners and experienced investors.
  • Robinhood traditional and Roth Individual Retirement Accounts (IRAs) offer up to a 3% match.
Try Robinhood, and get a special sign-up bonus here.
Try Robinhood, and get a special sign-up bonus here.

What is Robinhood?

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Robinhood is a commission-free investing and trading app that allows you to buy and sell stocks, exchange-traded funds (ETFs), options, and crypto without paying any commission fees.
Robinhood offers an easy-to-navigate investment portfolio, an integrated spending account, and traditional and Roth Individual Retirement Accounts (IRAs) with an up to 3% match on contributions.

How Does Robinhood Work?

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The platform is available on iOS and Android as well as a web-based platform, both of which are designed to be user-friendly and intuitive.
You can invest in stocks, options, exchange-traded funds (ETFs), and certain cryptocurrencies without paying any commission fees.
Robinhood also offers the ability to trade on margin at a low cost, the option to purchase cryptocurrency, and the ability to buy fractional shares.

Best Robinhood Features

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User-Friendly Interface: Both Robinhood's mobile app and web platform are designed to be simple and intuitive, making it easy for beginners to navigate.
No Investing Minimums: Robinhood does not require a minimum balance, allowing investors to start investing with any amount of money.
Commission-Free Trading: Robinhood offers commission-free trading of stocks, ETFs, options, and certain cryptocurrencies.
Fractional Shares: Robinhood allows you to buy fractional shares, making it possible to own a piece of a company without having to buy a whole share.
Fractional shares let new investors start investing in quality companies today instead of having to wait to be able to afford a full share of stock.
Educational Resources: Robinhood provides educational content through Robinhood Learn, a library of investing-related articles, and other resources like newsletters and podcasts to help you understand financial concepts and the stock market.
Cash Sweep Program: Robinhood Gold members who opt-in can earn 5% APY on uninvested cash through the brokerage cash sweep program, allowing you to earn interest on funds that are not currently invested.
Extended Trading Hours: Robinhood provides extended hours trading from 7 a.m. to 8 p.m. Eastern Time and 24/7 trading for select stocks and ETFs.
Research Tools: Robinhood provides basic research features such as analyst ratings and lists of top movers.
Charting Tools: For traders, Robinhood offers advanced charting, helping you to identify trends using technical indicators such as volume, moving averages, and the relative strength index (RSI).

Investing Automation Features

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While Robinhood is not a robo-advisor they do offer a few investing automation features:
Round-Ups: With Round-ups, you can round up your Robinhood Cash card transactions to the next dollar, and set aside the spare change to invest in your choice of stock, ETF, crypto, or brokerage cash balance to earn interest.
Recurring Investments: Robinhood allows you to set up recurring investments, automating the investment process.
This feature allows you to automatically invest a specified amount of money into stocks, ETFs, and cryptocurrencies at regular intervals, which can be daily, weekly, biweekly, or monthly.
Recurring investments help you to make investing a habit and build your portfolio over time, without the need to manually execute trades each time.

User Experience

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The user experience on Robinhood is intuitive and user-friendly, especially for those new to investing.
Whether you’re investing in stocks and ETFs or researching new investment ideas, everything can be conveniently accessed from the homepage.
From my years of testing many different apps and brokerages, Robinhood has continued to have one of the top mobile app experiences, helping make investing understandable and accessible to investors of all experience levels.

Investments Available

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Robinhood offers a variety of investment options for you. These include:
Stocks: Robinhood allows you to invest in most U.S. stocks listed on U.S. exchanges.
Exchange-Traded Funds (ETFs): ETFs are also available for trading on Robinhood. ETFs are essentially a basket of multiple stocks or other securities, allowing you to invest in the broader market or a specific sector or industry.
Options: Robinhood offers options trading, which involves buying or selling a stock at a specific price within a certain date range.
Cryptocurrencies: Depending on where you live, you may be eligible to trade certain cryptocurrencies with a Robinhood Crypto account.
Try Robinhood, and get a special sign-up bonus here.
Try Robinhood, and get a special sign-up bonus here.

Robinhood Crypto

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Robinhood Crypto is a platform that allows you to buy and sell cryptocurrencies such as Bitcoin, Ethereum, Litecoin, and several others 24/7 and commission-free.
It is a separate entity from Robinhood's stock trading platform, but you can still manage both accounts in the same Robinhood app.
Just like Robinhood’s stock investing platform, you can choose your market or limit order types and invest in crypto with as little as $1.
The majority of the cryptocurrencies on Robinhood are held in cold storage, disconnected from the internet, and are insured providing an additional layer of protection.
It is important to note that cryptocurrencies are not stocks and are not SIPC-insured like Robinhood’s stock and ETF investments are.
But for those who are simply looking to add some crypto exposure to your portfolio, Robinhood makes it convenient to buy and sell it within the same Robinhood app.

Robinhood Wallet

While Robinhood doesn’t support the ability to transfer crypto to and from your platform directly, they do offer a separate app called Robinhood Wallet.
Robinhood Wallet is a web3 self-custody wallet that lets you buy and transfer crypto from Robinhood to external crypto exchanges or hardware wallets.
It’s a separate app that’s designed for crypto investors who want more control and ownership over your crypto assets.
Whether you want more control over your crypto or you want the ease of use of keeping all your investments in the same app, Robinhood’s got you covered.

Robinhood Options

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Robinhood Options are contracts that give you the right to buy or sell a certain stock at a specific price until a certain date.
Options are a way for you to actively interact with stocks you're interested in without actually owning the stocks themselves.
Options can provide a form of leverage that can magnify your potential gains but can also magnify your potential losses.
Key features of Robinhood Options include:
Commission-Free Trading: Robinhood does not charge a commission fee to buy or sell options.
Variety of Strategies: Robinhood supports both basic and advanced options trading strategies. Basic strategies include buying calls and puts, selling covered calls and puts, and selling cash-secured puts. Advanced strategies include spreads and certain types of multi-leg strategies.
User-Friendly Platform: Robinhood is known for its user-friendly and intuitive interface, making it easier for beginners to start trading options.
Educational Resources: Robinhood provides educational materials to help you understand options trading and retirement planning.
If you dive into options trading on Robinhood they will emphasize that options trading involves significant risk and is not appropriate for all investors.
Certain complex options strategies carry additional risk, including the potential for losses that may exceed your original investment amount.
If you’re considering trading options on Robinhood it is highly recommended to explore Robinhood’s educational resources first.

Robinhood Stock Lending

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Robinhood Stock Lending is a feature that allows you to earn extra income on the stocks you already own.
By turning on Stock Lending, Robinhood takes care of finding borrowers for your stocks, ensuring you receive monthly payments when a match is found.
In return for lending your stocks, you receive a fee, which can be thought of as "renting out" your stocks for a fee. This program is designed to provide liquidity to markets and facilitate short-selling.
Even if your stocks are on loan, you can still freely sell them at any time and realize gains or losses, just as you would normally.
The amount you earn from lending out stocks can vary, with shares of smaller companies or those that are hard to borrow potentially offering higher fees.
You can enable or disable Stock Lending at any time through your Stock Lending dashboard in the Robinhood app or web platform.
While Robinhood provides cash collateral for the loaned stocks, it's important to understand that loaned stocks are not protected by the Securities Investor Protection Corporation (SIPC), and there is a risk that Robinhood Securities could default on its obligations to return the loaned securities.
Stock Lending can provide you with some additional income but it’s important to be aware of the risks involved before deciding if it’s right for you.

Minimum Investment Required

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Robinhood does not require a minimum investment to open a standard investing account, meaning you can start buying fractional shares of stocks and ETFs with as little as $1.
Robinhood was one of the first to bring fractional share investing to the market and they still make it possible to invest in companies with high share prices even with a small amount of capital.
Try Robinhood, and get a special sign-up bonus here.
Try Robinhood, and get a special sign-up bonus here.

Types of Accounts

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Robinhood offers several types of accounts to cater to different user needs:
  • Brokerage Accounts: Robinhood provides two types of brokerage accounts - Cash accounts and Margin accounts (a.k.a. Robinhood Instant accounts).
    • Cash accounts allow you to trade with the cash available in your account, while Margin accounts provide you with borrowing power to buy securities.
  • Robinhood Gold Account: This is a premium margin account that offers features like larger instant deposit amounts, access to Level II market data, higher interest on uninvested cash, and a higher IRA match rate, all for a $5 monthly fee.
  • Retirement Accounts (IRAs): Robinhood offers two types of Individual Retirement Accounts (IRAs) - Traditional IRA and Roth IRA. These accounts allow you to invest for retirement with potential tax advantages.
  • Robinhood Spending Account: This account lets you spend, pay, and opt into Robinhood round-ups, an investing automation feature. You also get a Robinhood Cash Card for use with this account.

Robinhood IRA

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Most brokerages offer retirement accounts today but Robinhood’s retirement accounts encourage saving for retirement by offering a unique feature in the industry— an IRA match up to 3%.
Robinhood offers two types of Individual Retirement Accounts (IRAs):
  • Traditional IRA
  • Roth IRA
These accounts allow you to invest for retirement, with any earnings having tax-deferred or tax-free growth potential, which means you keep more of your money.
Benefits of Robinhood IRA
IRA Match: Robinhood offers a 1% match on every eligible dollar contributed to your IRA.
This means if you contribute $100 to a Robinhood IRA,  $101 will be invested.
If you subscribe to Robinhood Gold, you can earn up to a 3% match on every dollar you contribute to your IRA.
As a Robinhood Gold member, for every $100 you contribute to a Robinhood IRA, $103 will be invested.
Investment Options: All of the stocks and exchange-traded funds (ETFs) available in a regular Robinhood account are also available in a Robinhood IRA. However, options trading and cryptocurrency trading are not currently available in IRAs.
No Management or Commission Fees: Robinhood does not charge any management fees or commission fees for the IRA account.
Try Robinhood, and get a special sign-up bonus here.
Try Robinhood, and get a special sign-up bonus here.

Robinhood Spending Account

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Robinhood does not offer a traditional banking or checking account. However, it does provide a feature known as the Robinhood Spending Account.
This account allows you to spend, pay, opt into round-ups, and get paid early with direct deposit.
It is linked to the Robinhood Cash Card, which is a Mastercard debit card that can be used for in-person and online purchases as well as ATM withdrawals.
Like most mobile banking accounts the Robinhood Spending Account gives you the option to set up early direct deposit, but it doesn’t currently support cash or check deposits.
While the Robinhood Spending Account offers convenience and flexibility for managing your money inside the same app, it does not earn interest like the uninvested funds in your Robinhood investment account do.

The Robinhood Cash Card

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The Robinhood Cash Card is the prepaid card linked to your Robinhood spending account.
Key features of the Robinhood Cash Card include:
Cash Back Offers: You can earn cashback in your Robinhood Spend account by using the Robinhood Cash Card at participating brands through the app, including 2% cash back on purchases at gas stations and grocery stores.
Round-Up Rewards: You can enroll in Round-up Rewards to have Robinhood round up your transactions to the nearest dollar and invest the difference into your Robinhood portfolio.
ATM Access: With the Robinhood Cash Card you’ll have access to a vast fee-free ATM network with more than 75,000 ATMs in the U.S. and 15,000 ATMs overseas.
No Hidden Fees: There are no monthly fees, overdraft fees, or requirements to maintain a minimum balance when using the Robinhood Cash Card.

Is Robinhood Safe?

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Yes, as a member of SIPC (Securities Investor Protection Corporation), Robinhood is SIPC-insured against brokerage failure. Securities in member's accounts are protected up to $500,000, including up to $250,000 for cash.
SIPC insurance is investor protection for investment brokerages. Robinhood is also regulated by the Securities and Exchange Commission (SEC).
Robinhood’s Spending Account is also FDIC-insured through its nine partner banks, including Goldman Sachs Bank USA, HSBC Bank USA, and others for coverage up to $2.25 million.

Pricing and Plans

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Robinhood was one of the first brokerages to bring commission-free trading to the market.
And they’re still leading the way with no commission fees for buying or selling stocks, ETFs, crypto, or options.
All the core investing tools, automation features, and built-in research is available for free without a monthly subscription fee.
However, if you are interested in some additional investing benefits you may want to consider their premium membership called Robinhood Gold.

Robinhood Gold

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Robinhood Gold is a premium subscription membership designed to provide you with advanced features and tools to enhance your investing experience.
For just $5 per month, it includes a suite of benefits that both long-term investors and active traders will appreciate.
Benefits of Robinhood Gold:
  • Enhanced Earning on Uninvested Cash: Robinhood Gold subscribers currently earn 5% annual percentage yield (APY) on uninvested cash through the brokerage cash sweep program, compared to 1.5% for members without Robinhood Gold.
  • Bigger Instant Deposits: Gold members have access to larger instant deposit limits, up to $50,000 per day, allowing them to invest deposited funds immediately without waiting for the bank transfer to complete.
  • Professional Research and Market Data: Subscribers receive professional research from Morningstar and Level II market data from Nasdaq, which can provide deeper insights into market trends and investment opportunities.
  • Margin Investing: Robinhood Gold provides access to margin investing at a lower interest rate than non-Gold members, which allows you to borrow money to invest.
  • IRA Contributions Match: Gold members receive a 3% match on IRA contributions each year compared to a 1% match for non-Gold members, which can enhance retirement savings.
For users interested in taking the premium membership for a test driveRobinhood Gold offers a 30-day free trial for new users, after which the service costs $5 per month.
Try Robinhood, and get a special sign-up bonus here.
Try Robinhood, and get a special sign-up bonus here.

Pros and Cons

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Pros:
  • Commission-Free Trading: Robinhood offers 100% commission-free trading on stocks, options, ETFs, and cryptocurrencies, making it attractive to investors who trade frequently.
  • Ease of Use: The platform is one of the leaders in user-friendly and intuitive interfaces, which is especially beneficial for beginner investors.
  • No Account Minimum: Robinhood does not require a minimum amount to open or maintain a brokerage account, making it accessible to investors with limited capital.
  • Fractional Shares: Robinhood allows investors to buy fractional shares of thousands of stocks, even with as little as $1 to invest.
Cons:
  • No Robo-Advisor Features: Robinhood is designed for stock trading. While Robinhood can be used for buy-and-hold investing, the bulk of its features are geared toward trading.
  • No Automated Portfolios: For hands-off investors looking for passively managed portfolios, you won’t find any on Robinhood.
  • Limited Research and Data: While Robinhood offers beginner-friendly research tools, it may not satisfy the needs of professional traders who require in-depth data and analysis.

Who is Robinhood Ideal For?

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Beginner Investors: The platform's intuitive interface is designed to provide easy access to the stock and crypto markets, which is beneficial for those new to investing.
Active Traders: With commission-free trades on stocks, options, ETFs, and cryptocurrencies, Robinhood is attractive to investors who trade frequently.

Robinhood Alternatives

Robinhood is a user-friendly app for investors of all levels, but here’s a few other apps worth considering.
Public: Public is a user-friendly stock trading app that offers commission-free trading of stocks, ETFs, crypto, and options as well as access to T-Bills and high-yield savings accounts.
Public: Public is a user-friendly stock trading app that offers commission-free trading of stocks, ETFs, crypto, and options as well as access to T-Bills and high-yield savings accounts.
Webull: Webull is a stock trading app that offers advanced trading tools, data, research and commission-free trading of stocks, ETFs, and options.
Webull: Webull is a stock trading app that offers advanced trading tools, data, research and commission-free trading of stocks, ETFs, and options.
M1 Finance: M1 is a comprehensive investment platform that offers a unique blend of automated investing and individual customization, allowing you to invest in fractional shares of stocks and ETFs.
M1 Finance: M1 is a comprehensive investment platform that offers a unique blend of automated investing and individual customization, allowing you to invest in fractional shares of stocks and ETFs.
Here’s a quick recap to keep things simple:
Platform
Features
Who it's for
Robinhood
Trade stocks, ETFs, crypto, and options commission-free
Investors & Traders
Public
Invest in stocks, ETFs, crypto, options, and T-Bills
Investors & Traders
Webull
Advanced trading tools, data, & commission-free trades
Active Traders
M1 Finance
Smart portfolios, fractional shares
All investors

Final Thoughts

Robinhood has revolutionized the investment industry by offering commission-free trading and a user-friendly platform, making investing more accessible to a broader audience.
Its features such as fractional shares, instant deposits, and cryptocurrency trading cater to a variety of investors, especially those who are new to investing or prefer a mobile-first platform.
Robinhood’s versatility makes it a good choice for both beginner investors and active traders who prioritize low costs and ease of use.
Try Robinhood, and get a special sign-up bonus here.
Try Robinhood, and get a special sign-up bonus here.