In the past I’ve tried two stock brokers that charged a fee to do trades. I later discovered the Robinhood App that lets you trade stocks for free. At first I was skeptical but decided to try it out seeing the good ratings and high downloads on the Google Play Store. I put some money into the account and bought and sold some stocks. I saw that this was actually legit. No fees at all. It was pretty cool. In the past I used paid stock brokers and would get charged a five or six dollar fee to trade. Some brokers give you a free trading period when you sign up but Robinhood is always free. It does not expire.
How Is Robinhood Able To Offer Free Trading?
According to Robinhood they are able to allow free trading because unlike traditional bank brokers they do not have the expense of maintaining brick and mortar locations so they can keep their expenses low. Also they offer a paid plan with additional features that makes them money.
Robinhood For Beginners
This app is a great app for beginners and for those trading with a small amount of cash. Trading is free and you can learn to trade stocks without loosing money to fees. If you are buying a $20 stock and get charged a $5 fee you instantly loose 25% and when you sell you loose again with traditional brokers.
Robinhood For Day Trading
As far as using this app for more serious trading you will probably need to use other sources to do research on the stocks. Robinhood just gives you the basic information about stocks. You cannot compare graphs or do other analysis on trends. If you just want to buy a stock and hold on to it this app is perfect for that. But if you are thinking of doing day trading or swing trading it lacks some features. Another con is that when you are placing a trade it takes you to another window so you can’t see how the stock is performing while you take a couple seconds to place the trade (If you are by a computer you can have a graph open on your computer while you place the trade on the phone). Currently Robinhood does not provide a website platform so you can only trade through the app. One cool thing with Robinhood is that you don’t have to wait 3 days for funds to settle from stock sold. You can instantly trade again with that money. Robinhood also keeps track of your day trades to prevent you from doing more than you’re allowed if you don’t have the required $25k to do daily day trading.
Placing a trade is easy. With a couple clicks you can make your first stock purchase. It gives you options to do limit trades, stop loss, stop limit and market trades. The app has a nice clean design that’s easy to navigate. It’s easy to move money to your account. You can move up to $1000 instantly.
Robinhood Payed Plan
Robinhood offers a payed plan that gives you more trading options. You can trade before markets open and after hours. You can also get margin to trade with. I haven’t tried this feature so I don’t have any comments on it.
This app is great and I have recommended it to others. Even though it lacks some advanced analysis features it is a great app overall. Currently it’s the only broker the I am aware of that is free.
2/22/19 – Robinhood now has a website platform. You can log into to their website and trade from there.
Watch my Robinhood video review: