Those that decide to use Robinhood for their trading and investing needs can expect a number of quality services and features upon getting started. Prospective clients who use Robinhood will be able to take advantage of the following items:

Pricing and Fees

Robinhood charges $0 commission fees for its securities. In an industry known for charging up to $10 for securities and requiring $500 to $2,000 account minimums, Robinhood's pricing structure is fairly shocking. The firm's creators believe that there are millions of investors out there who use brokerage firms, place more than 10 trades per month, and yet end up paying thousands in fees each year. Unlike these firms, Robinhood doesn't charge steep fees for placing trades, doesn't have a mandatory account minimum to start a trading account, and doesn't have the same operational costs as other big name brokerage firms. So, they can afford to keep costs low and increase their clients' savings. Existing brokerage firms claim their services, like research and educational tools, are worth the fees they charge their clients. Robinhood disagrees. It believes that millennial investors-its target audience-don't care for paying money for services they may not use or may find inadequate. Instead, young investors tend to look elsewhere for free resources that'll help them make informed decisions.

Mobile Capabilities

The firm's trading platform is a mobile app available on android and iOS smartphones and tablets. On the platform, users have access to any of the 5,000+ stocks and ETFs listed on the US stock exchange, meaning the firm doesn't put a limit on the number of stocks users can access at the $0 commission rate. The app's sign up process is fairly straightforward and takes a little time to complete. Users have hailed the app for being easy to use and easy to link their bank accounts to. The app doesn't require a routing number nor does it take days to verify users' bank information. Instead, it uses micro-deposits to validate users' accounts.

Scheduling Feature

In addition to its commission-free stocks and ETFs, Robinhood offers scheduled deposits. This is a new feature where users can automatically schedule transfers on a weekly, biweekly, monthly, or quarterly basis. Another one of its new features is its advanced order support tool. Investors can use this feature to enter specific orders as good for the day or good until canceled (GTC). All of these aforementioned perks make Robinhood ideal for investors, especially millennial investors.

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The Bad

Limited trading tools
Looking ahead

The Robinhood service, while convenient and accessible, also comes with a number of limitations. Prospective users should consider the following drawbacks before creating an account and getting started on the platform:

Limited Trading Tools

The firm only offers a mobile app trading platform. While great for millennial investors who are always on their smartphones or tablets, this means the brokerage firm doesn't offer advanced trading tools. Usually, only desktop platforms have these advanced features like charting mechanisms and volatility indicators. Without these tools, the firm lacks critical features to help better inform its investors. Speaking of informing users, the firm also doesn't offer additional resources like education materials or research tools. While its creators believe that millennial investors tend to not use these features, we're pretty sure that investors would enjoy the added benefit of having their educational and research resources under one roof since it will save them time and energy from looking elsewhere.

Looking Ahead

Robinhood doesn't charge its investors any hidden fees, so for now, its users can rest easy knowing they're truly executing commission free trades. However, in the future, Robinhood may need to change its pricing structure to make money and keep its doors open. Eventually, the firm will charge for premium services if their traders decide to use them. The firm will also begin offering margin trading, which will allow its users to borrow money from the brokerage firm to cover a certain percentage of the securities' costs. The firm will then make money off of the interest rates they'll charge on the loans. Potential clients looking to join Robinhood should be aware of these impending fees. Furthermore, the company only offers stock and ETFs trades. Investors currently cannot trade options, bonds, mutual funds, and other securities. For investors who are interested in investing in a variety of securities to diversify their portfolios and mitigate financial risks, this detail is fairly disappointing. Additionally, the firm doesn't offer ACAT transfers, which means traders cannot transfer their existing brokerage assets into Robinhood. Another major downside to the firm is the fact that it's not the first brokerage firm to try out commission free trades. Zecco was a brokerage firm that implemented this model and had to frequently change its pricing structure because of how difficult it was for the company to stay afloat. Eventually, Zecco gave up, determined the model wasn't successful and instead, merged with TradeKing. This story could dissuade users from joining Robinhood since the firm's business model could be unfeasible in the long run.

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The Bottom Line

Robinhood is a great brokerage firm with the commendable goal of democratizing access to financial markets. It's especially ideal for novice and millennial investors looking to dip their feet into the industry without paying high commission rates. The brokerage firm offers thousands of individual stocks and ETFs to invest in, all at the touch of a button. Its mobile app is easy to use and boasts a quick and simple application process. However, the brokerage firm doesn't offer a variety of investment choices so individuals looking to trade the likes of options and bonds will have to look elsewhere. Furthermore, traders currently with another brokerage firm won't be able to transfer their existing account to Robinhood. This detail severely undermines the firm's ability to steal clients away from the big name firms. At the end of the day, our main concern is whether the firm's commission free rates are feasible in the long run, especially since similar firms have had to close their doors. Only time will tell whether Robinhood's business model is, in fact, sustainable.

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User Reviews

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4.3

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62 Reviews

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Jesse Breffle Denver, CO

Robinhood is a great way to start trading. It has a simple user interface and even has a handful of articles to help you start learning the ins and outs of trading. Granted one should always remember not to invest what they can't afford to lose. But to get started and have some fun playing around or if you are a serious trader Robinhood can satisfy both ends of the spectrum.

5 years ago

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Kevin Jackson Salt Lake City, UT

I started with Robinhood a few years ago to learn about he stock market. As a new comer who was still finding my strategy...Robinhood was crucial. With no fees, a flawless mobile experience and a speedy deposit process I was hooked from day one. I will never use another brokerage. In fact I have signed up for Robinhood gold at 10 dollars a month to get leveraged trading and after hours access. Robinhood also just announced free options trading, what’s not to love??

8 years ago

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Anne Sainsbury Orem, UT

I just barely started using Robinhood and I love it. I am new to investments so this has been a stretch for me, but I have enjoyed my experience thus far. I love how easy it is to pull money from my bank into the app so that I can make quick investments. I also really love how I can quickly see how each of my investments is doing on a daily, weekly, monthly, 3 month, yearly, and 5 year scale.

5 years ago

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Landon Badoni Montgomery, TX

Robinhood is great for those who are breaking into the investing scene and want a simple and straightforward investing option that allows them to do things on their own. I've been using Robinhood for several months now and have only really scratched the surface of what it can do. One feature I appreciate is that I can set it to automatically invest in certain stocks on a weekly basis. That way I don't have to constantly go in a think about investing each week.

5 years ago

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Emily H West Wendover, NV

Process for signing up was simple, straightforward, and secure. I love that you can buy partial shares so you can invest exactly how much you have. The company is great about sending automatic updates via email about gains in the account. They constantly have promotions for getting benefits for recommending friends. For a novice investor like me, I felt really happy with my first investing experience with this company!

5 years ago

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Shannon B Salt Lake City, UT

I have loved Robinhood so far! It's amazing that they give you a free stock when you sign up and a free stock every time you refer a friend. I was intimidated to start investing, but Robinhood has made it so easy to start.

6 years ago

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Karen Torino Tallahassee, FL

My favorite aspect of Robinhood is that it lets you schedule when you would like to buy or sell a stock. For example, I can choose to shedule a stock to sell when it reaches a certain value. The app is easy to use and navigate.

4 years ago

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Daniel Cebrero Henderson, NV

I’ve use robinhood since day one and I love it. The interface is easy to use and very informative. It’s always worked well for me and it’s easy to buy stocks and cryptocurrency. I always use the recommendation links for my friends and family so they can get started

4 years ago

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KG Lebanon, NJ

I use Robinhood and think it’s pretty cool since I am not someone who is very savvy with trading. I don’t do a lot but that’s OK with Robinhood because it allows me to do as little as I want or I can increase it at any time. Before Robinhood I was afraid to do any trading but now it’s so simple using the app!

4 years ago

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Tommy McCarlie Chicago, IL

Although as they have gotten bigger they take longer to deposit funds for trading (and I would assume are making profits off of this) I still can't say no to Robinhood because it's easy to use and reduces the barrier to invest for beginners.

5 years ago

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Caitlin Fayetteville, AR

I have had nothing but a pleasant experience with Robinhood. Although, I have used other platforms that are similar, Robinhood exceeds expectations in being straight forward and helpful. They are truly the platform for any user from beginner to advanced. They also have a very quick response time on support. 5 stars!

5 years ago

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JG00 Saint Charles, MO

I joined Robinhood last year and the app was already easy to use and explained everything perfectly for beginners in investing. They're was a recent update that also made it look more visually appealing. I enjoy the "Fractional Shares" option that Robinhood has.

5 years ago

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anna blaser St Louis, MO

I like that you don’t have to pay fees when you make a trade, but I don’t like that you can’t trade when everyone else is trading. They block you from certain stocks for a certain period.

4 years ago

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Andrea Thomas Richland, WA

Robinhood has been easy to use on my phone. It simplifies the investment industry and the trading is simple! I’ve had no problems with the app. Getting paid out to my bank has been easy too! I would recommend.

4 years ago

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Mandy Pesce Laurelton, NJ

Robinhood was extremely easy to sign up for and to buy stock with. It also gave a code to share with friends to get a free stock upon signing up. Easy to check in and buy or sell stocks whenever you want.

4 years ago

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Abby Ashby Provo, UT

I like robinhood. I made $40 on it lol. So anything that makes me money is great. Looking forward to getting more into investing as I get more money... poor college student rn

5 years ago

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Chelsea Pleasant Grove, UT

Is amazing for your investments made over 700$ in a year and is super easy to do taxes with is nothing to difficult! Same with pulling out your money and adding some!

4 years ago

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Rocio Diaz Tallahassee, FL

Robinhood is amazing and I like how it is a free service (up to a certain point). You can participate in cryptocurrency and also buy smaller shares of stocks.

4 years ago

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Aiyana Brown FL

robinhood makes investing easy! everyone i know who uses it has seen success in their investments both short and long term, so it definitely worth it.

4 years ago

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Anya Lee Jacksonville, FL

Robinhood gave me the ability to really take charge in my investment portfolio. This app is user friendly which gives me the confidence to invest more.

5 years ago

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Tiffany I Hyattsville, MD

Robinhood is easy to use and I like that I can buy Bitcoin there as well. I love how the favorites are broken down on my mobile app so I can see their activity

5 years ago

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Conrad Ma American Fork, UT

Robinhood is great for buying and trading stocks. They give you a free stock when you sign up but it isn’t necessarily something to get your hopes up about.

5 years ago

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Rick Froid Park Ridge, IL

Very happy with Robinhood. Quick and easy sign up and very helpful site. Have learned a lot in the past couple years since joining.

4 years ago

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Jon Posey Riverton, UT

Hands down the best platform for online trading. It is so easy to use and helps illiterate traders like me dable in the market. Love it!

6 years ago

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Jon Moreno Sandy, UT

Robinhood was recommended by a friend and I have enjoyed my experience with some day trading. Plus you get a free stock when you sign up!

6 years ago

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Devin McClellan Eagle Mountain, UT

I have used Robinhood for a lot of trades. It is very simple and easy to use and I recommend it to everyone.

4 years ago

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Matt Clark Provo, UT

I haven’t had any problems with Robinhood. They give you mostly free reign to invest how you want.

4 years ago

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Jordon Patton Pflugerville, TX

Robinhood is a great way for new investors to start investing. They make it really easy to buy and sell stocks.

5 years ago

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Kyle Johnson Portland, OR

Robinhood has been a great way to get into the investing world. I love that its a free way to learn.

5 years ago

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Keld Sperry Lehi, UT

Robinhood has made it so simple and easy to trade stocks. With no fees buying stock it makes it the best stock app.

6 years ago

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Samantha Lubin Tallahassee, FL

Best stocks app I have ever used! Taught me a lot.

4 years ago