Robinhood is an investment and financial platform that allows its users to buy and sell U.S. based publicly traded stocks, options, ETFs and cryptocurrencies without charging any commission, making it the only zero-commission multi-class trading platform currently on the market, also the platform supports cash management options.
Robinhood Markets Inc, referenced informally as Robinhood, is a U.S.-based financial services company headquartered in Menlo Park, California. The company offers the Robinhood smartphone mobile app, which allows individuals to invest in public companies and exchange-traded funds listed on U.S. stock exchanges without paying a commission. Robinhood operates a website and mobile apps for iPhone, Apple Watch, and Android. The company has no storefront offices and operates entirely online.
The firm is a FINRA-approved broker-dealer, registered with the U.S. Securities and Exchange Commission and is a member of the Securities Investor Protection Corporation. The company's main source of revenue comes from interest earned on customers' cash balances and margin lending. The app has gone under scrutiny for establishing a checking account that offers high interest rates as it is not insured by the Federal Deposit Insurance Corporation.
Robinhood’s sign-up process is streamlined for efficiency. One can sign-up from the company’s mobile app or its web interface within 5 minutes. After a user signs up, his application is verified and approved automatically within one hour unless additional information is requested. Given its status as a U.S. broker-dealer, Robinhood must also perform anti-money laundering background checks and insider trading precautions on its future account holders as well.
Traditionally, stock investors were wealthy folks or speculative investors (short term investors that wanted to profit based on trading patterns) that went to brokers to transact in select securities or manage their portfolio. With the influx of more specialized brokerage platforms that use innovative technology to make the stock market more accessible, there are several new users and niche customers that are investing in the stock market.
Although Robinhood does not charge per-trade commissions, the company generates revenues in three other ways. Robinhood generates income by investing the unused cash (that has not been converted into equity insecurity) in their Robinhood accounts. The company requires its customers to first deposit money from their bank account into their Robinhood account before they begin trading. Robinhood charges it's Gold Account users a monthly subscription fee for increased buying power and instant deposit limits. An estimated 75% of Robinhood’s transactions were processed through its Gold Accounts, Gold account transactions have been increasing at 17% month-overmonth.
Robinhood gold customers with a cash balance of over $50,000 in their Robinhood accounts are charged a 5% annual percentage rate (APR) level of interest because of the buying power that allows users to essentially borrow money from the company to make trades. The interest is charged for increased buying power.
OpsssAll insight information is available only for Pro usersLooks like it's time to go Pro
Price Per share Table
Robinhood's VP of product just left the Robinhood after less than 2 years on the job
Robinhood traders discovered a Glitch that gave them ‘infinite leverage’
The competitive exchange space: Trading fees continue to drop. Robinhood in the trouble?
Square launches stock trading on its popular Cash App
Robinhood introduced options to stop-limit orders
Charles Schwab will be the first broker to let people buy fractions of stocks
Charles Schwab talks about the zero-commission brokerage and competition
Bearish investors say US economy has peaked
Robinhood reached more than 600 employees to achieve the mission
Schwab will win The Broker Wars - Forbes opinion
Robinhood is launching a new Cash Management feature
Experts from Financial Planning doubt that the company can surprise investors
Robinhood Joins the Online Cash War - Wall Street Journal opinion
Introducing Cash Management
Former SEC commissioner, Dan Gallagher, joins Robinhood’s board of Directors
E*Trade, Schwab, Ameritrade go zero-fee too after Robinhood
Robinhood has a new office in Denver
FCA authorizes Robinhood to operate in the U.K.
Robinhood Introduced - Messages
Robinhood raised $323M to democratize finance for all
Gretchen Howard elevated to Chief Operating Officer
JPMorgan just shut down Finn
Robinhood introduced new charts on Robinhood Web
Robinhood acquires MarketSnacks to update Financial News
Gretchen Howard joins Robinhood as Vice President of Operations
Jason Warnick joined Robinhood as Chief Financial Officer to prepare for possible IPO
Robinhood updated news feed, but users react negatively on it
Robinhood introduced Clearing
Global stocks now are available
Multi-Leg options strategies just launched
Robinhood raised $363M to expand product lineup
Robinhood named a 'Best Place to Work'
Web-version is just launched
Robinhood reached two million users and secures Series C financing
Robinhood wins Google Play Award
Robinhood introduced Instant
Robinhood for Apple Watch just pumped