Robinhood App Review – Free Stock Trading

It is always interesting to discover and check out a new broker to see if the services offered differ from the competition. Yes, too many of them resemble each other. Sometimes it is hard to find significant differences.

​But when reading a slogan that promises the possibility to step into the future of trading to stay on top of one‘s portfolio anywhere and anytime – even without any commissions -, this evokes curiosity and the suspicion that it sounds too good to be true, with a hidden catch somewhere.

Upon closer examiniation however one cannot help but notice that the Robinhood App is outstandingly successful in the United States.

Can so many users be wrong?

Thus we decided to check out the app and review it for our readers.

If you are curious to find out if Robinhood really keeps their promises, continue reading the Robinhood App Review!

robinhood review - website

robinhood review - website

What is Robinhood – and what makes the Robinhood App special and different?

Robinhood was launched based on the thought that modern, innovative technology should take brokerage to a brand-new level while reducing paperwork, efforts and costs.

This makes perfect sense. Why have dozens of staff doing what tech solutions can do instead?

A decision that cuts brokerage costs considerably. So far, so good.

As usual, the first impression is a visit to the Robinhood website – which looks great, exactly as modern and innovative as the technology they promise.

Unlike other broker platforms, it is not overloaded or overwhelming, but presents the basic, most significant information in a modern and well structured layout. The positive impression serves to make the reader more curious and looks like there isn‘t any attempt at hiding things within a ton of information.

But back to Robinhood itself. This stock brokerage presents itself as a business with a mission – the mission that everybody should have access to the financial markets for free and that this should, hopefully, encourage and inspire the next generation of investors.

Robinhood gives everybody the opportunity to buy and to sell U.S, listed stocks and ETFs without commissions – really!

Later on we‘ll explain how they do this, but first a few more words about the company.

​Everything started at the Stanford University about ten years ago when the co-founders of Robinhood, Vlad Tenev and Baiju Bhatt, were students. Being roommates, they had lots of time to discuss their vision. From there, they went to Wall Street to build their own company and trading platform.

The underlying idea is surprisingly simple. Electronic trading platforms don't have to pay anything for placing trades while their competitors still charge high fees from investors. Time has stood still there as these charges relics of the time before the internet.

Vlad Tenev and Baiju Bhatt decided to share the advantages of the digital era offering a cost efficient brokerage.

  • Why didn‘t anyone else think of this? 
  • What's the secret?
  • How can the owners of Robinhood pull this off? 
  • Who pays for their living?

We wanted to understand this and investigated. Go on reading and the secret shall be revealed.

Robinhood App – What do they offer and how do they handle it?

Before going into the services and prices, it should be explained how Robinhood manages the platform without taking commissions.

Well, the company is as efficient as the website that is so unusually easy to navigate and to find the information one is looking for. 

By cutting out the manual account management, lots of storefront locations and expensive advertising, Robinhood keeps the costs amazingly low, maybe lower all their competitors.

The secret of commission free trading with Robinhood App revealed

Believe it or not, trading with the Robinhood App is truly free of commissions. But of course even the company with the lowest costs of all has to make some money.

So, they are charging their customers for only one of their products called Robinhood Gold. This service gives their subscribers twice their buying power and full access to trading after regular hours.

This costs $ 6 a month.

In addition to the money Robinhood makes with this premium service, the company makes a profit collecting interest on the money and securities of their clients in the Robinhood accounts,  exactly like every other bank does with cash deposits, which seems only fair.

Robinhood App – Services, Accounts and Fees

Upon signing in to Robinhood App users get a standard Robinhood account with access to instant settlement and deposits. One may start trading immediately with up to $ 1.000 of the personal deposit.

This basic account is a limited margin account allowing Robinhood to credit the account during the three days of the settlement – with the amount of the stock sale during this time.

Just like with every other limited margin account, traders have to follow the rules of margin account regulations when using Robinhood and day trading.

​However, comparing this basic account with other margin accounts, it is evident that investors cannot borrow more money than what is deposited in their accounts.

Nor can one sell stocks one doesn‘t own. This means one cannot lose more than what is deposited in the account. In future Robinhood App plans to offer more options, but for the time being they are working on necessary upgrades for the existing model.

Beyond the basic, users have the option to sign in to Robinhood Gold, the completely leveraged margin account already mentioned. This costs $ 6 per month, but there are no other fees.

Once signed in one may downgrade to a cash account that doesn't grant instant settlements and deposits.

This downgrade is just as easy as everything else – by opening the app and the personal account, users can go into day trade settings and turn off instant settlement. 

As soon as it is confirmed that there are no unsettled funds and no pending transactions, the change is effected fast and smoothly.

Robinhood plans also to support trust, custodial, joint and IRA accounts soon in addition to the options mentioned above.

While it seems incredible, the regular Robinhood instant service is truly free, in keeping with the company's philosophy to give all kinds of investors – beginners and professionals – the same chances, opportunities and trade ideas.

There are no trading commissions, no interest charges, no account minimums, no subscription or maintenance fees and no charges for upgrades. Thus we cannot list the Robinhood fees here as they simply don't exist.

The platform provides clear and detailed explanations about how to sign in, how to open an account and how to initiate a deposit. All this is easy and understandable – and here you go, day trading with Robinhood App, like it should be done in the digital era.

Anyone who still has a question may contact the Robinhood help center, use the detailed FAQ section containing a lot of useful information or go to the impressive blog starting with “Two Million Thanks”.

Yes, since the beginning in 2015, Robinhood already gained two million users who have transacted more than $ 50 billion so far. And it should be mentioned that during this time they saved almost half a billion dollars in commission fees for their users.

Two million users can't possibly be wrong. There seem to be many good reasons why Robinhood is the fastest growing brokerage ever.

robinhood app users

robinhood app users

Robinhood App – Safety and Execution

As an SEC registered broker-dealer, Robinhood is a member of FINRA (Financial Industry Regulatory Authority) and SIPC (Securities Investor Protection Corporation). This means that users are protected with up to $ 500,000 including $ 250,000 for cash claims.

All personal information is completely encrypted and safely stored. Robinhood uses state-of-the-art security technology and users are encouraged to ask for details.

In trade execution Robinhood works with outstanding, advanced trading systems in use by some of the biggest global financial players. Robinhood understands that in the stock market the fraction of a second makes the difference between profit or loss.

Thus they promise that users do not loose precious time.

Market data are streamed in real time by the servers of Robinhood providing real-time data without any delay quotes – for free. Besides, users are notified of scheduled events in advance, like about dividends, earnings or splits. To sum it up, they provide up-to-date information at the perfect time.

And last, but not least, Robinhood's free stock trading is expanding internationally. Refer to the platform to find out more about this.

Robinhood App – 6 Top Advantages

  • ​no trading commissions, no interest charges, no account minimums, no subscription or maintenance fees and no charges for upgrades – six big advantages in one line!
  • ​fast and easy mobile trading wherever, any time
  • ​trustworthy safety and protection, Robinhood being a member of FINRA and SIPC
  • guaranteed fast execution
  • real time data and information – for free
  • a perfectly organized platform easy to navigate, to understand and to use

The downside of Robinhood's mobile app

  • ​Mobile trading is not fast enough for active day trading
  • ​Only basic functionalities compared to other brokerage platforms (e.g. no Level 2)
  • ​No stock screener included, only trade execution

Robinhood App – Pros and cons

Usually every review should end with a short list of pros and cons to make it easier for readers to decide if they want to try the platform in question.

For once, we have to break the rules – regarding the advantages one can just repeat what is mentioned above, only in further detail. 

As far as the disadvantages go, one might mention that the international expansion is not finished yet, but it would be hard to find anything else. ​

Robinhood App – a personal summary

​​A review that’s too positive might not seem honest and unprejudiced. Well, that’s true, and usually there is a lot more to criticize when writing a review. In this case, however, it was really hard to find disadvantages or discrepancies.

Everything stated on the website makes perfect sense, the platform is not overloaded with useless and confusing information, which truly gave a positive impression. And it was almost impossible to find any disadvantages.

ROBINHOOD REVIEW

ROBINHOOD REVIEW

Remember, this service is for free. So, there is no risk and we’d suggest to check out the app at https://www.robinhood.com/ Furthermore the Robinhood App is a great addition to Trade Ideas Pro mobil​e app

OVERALL RATING:

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