Robinhood offers three levels of accounts, each having varying levels of access to Robinhood’s core features. Here’s a rundown of the most important Robinhood features to know about:
The primary reason many users choose Robinhood is the cost. With standard accounts, there are no recurring fees. Additionally, there’s no charge for trades. You can buy and sell, and buy and sell without ever paying a penny in commissions to Robinhood.
The only trading fees are required by all brokerages, notably the Securities and Exchange Commission (SEC) fee and the FINRA Trading Activity Fee. These are very, very small. Robinhood doesn’t require this of its customers for sale orders under $500 or transactions with less than 50 shares.
Once logged into Robinhood, the platform is easy to navigate and use. There are not a lot of extra bells and whistles. The main focus is on your investments, basic investment data, and easy access to the trade button.
Robinhood isn’t the most robust trading platform and doesn’t offer all of the advanced charts and trade types that expert, experienced traders may want. But the basics are covered, making it a good choice for beginner investors and casual investors.
Unlike many competing brokerages, Robinhood supports cryptocurrency through a dedicated Robinhood Crypto account section. Robinhood doesn’t charge any commissions to buy or sell crypto, just like other products.
Serious crypto traders should be aware that Robinhood only supports a relatively short list of digital currencies, and users aren’t yet able to withdraw to outside crypto wallets. The good news is that Robinhood recently added four new supported currencies (COMP, MATIC, SOL, and SHIB). Crypto Wallet support is also on the way and users won’t charged any fees to send, receive, or withdraw crypto from their wallets.
If you’re looking to buy the most popular currencies and hold them at Robinhood, the price is right. But if you’re looking for a crypto-specific broker or exchange, these platforms have some sweet sign-up bonuses on offer.
On August 17th, 2022, Robinhood started rolling out advanced charting for users. This lets you conduct more in-depth analysis on stocks and other asset classes, and you can also customize charts with various indicators you want. According to its website, this feature will be broadly available by early October 2022.
At launch, indicators and data you can leverage includes moving averages, Bollinger Bands, Relative Strength Indexes, and several other indicators. Overall, this feature was a much-needed addition to Robinhood since it now caters both to beginner investors but also more experienced traders who want more data.
If you’re looking for passive income, Robinhood’s stock lending feature could be what you’re looking for. This feature lets you lend out stocks you own, and you get paid with monthly fees if someone ends up borrowing your stocks.
The reason this feature exists is because financial institutions and traders sometimes want to borrow stocks to facilitate trades or for short selling. So, Robinhood lets you lend out stocks, and if someone borrows it, you earn whichever of the following option pays more:
- A rebate rate of 15% of the weighted average rebate rate Robinhood earned by lending out your stock that day
You can’t pick and choose which stocks you lend out; once you enable the feature, Robinhood can lend out anything. But you can still sell your stocks anytime even if you’re lending. And Robinhood backs up these stock loans with cash as collateral.
To enable stock lending, you need a Robinhood portfolio of at least $5,000 or $25,000 in reported income. Alternatively, entering any trading experience other than “none” unlocks this feature.
Just note: dividend income from stocks you’re loaning out are considered manufactured dividends and are taxed as ordinary income, not capital gains.
Brokerage Cash Sweeping
Like its stock lending program, Robinhood’s brokerage cash sweeping feature is another way customers can make the most of their assets. Except in this case, we’re talking about your uninvested cash, not stocks you already own.
With this feature, Robinhood customers can opt-in to brokerage cash sweeping to have their uninvested cash moved into deposit accounts at a network of six various partner banks. Your cash gets up to $1.5 million in FDIC insurance, and the banks currently pay 1.5% APY.
This isn’t as high as many high-yield savings accounts offer. However, it’s much higher than a basic savings or checking account and is a useful feature for putting your idle funds to work.
Robinhood Cash Card
One new Robinhood feature is its Cash Card, a Mastercard®-powered debit card that lets you earn stock and crypto rewards for spending. As you spend at eligible brands, you round-up your spare change into a weekly round-up pool. You then earn a 10% – 100% bonus on your weekly round ups, with the money getting invested into stock or crypto of your choice.
There’s a $100 weekly cap on round-ups, and bonuses are capped at $10 per week. But if you maximize the $10 weekly bonus, that’s $520 per year in extra stock and crypto. Brand partners also include popular names like Nike, Macy’s, Five Guys, and more brands are in the pipeline.
This card doesn’t charge monthly or annual fees either. And you get free withdrawals at 90,000+ AllPoint and Moneypass ATMs. Cash also gets up to $250,000 in FDIC insurance.
Note that the new Robinhood Cash Card means that Robinhood’s old Cash Management account isn’t open to new members anymore.
Robinhood Gold Features
Robinhood Gold is a premium account with additional features and improves upon other features with higher limits. The main reasons to sign up for Robinhood Gold are margin investing, Level 2 NASDAQ market data, and professional research reports from Morningstar. Gold customers also have higher instant deposit limits than customers with a basic account.
You can try Gold with a 30-day trial before paying the $5 monthly subscription fee. However, many large brokerage firms offer research reports, all available market data, and margin accounts without requiring payment for a subscription.
Further reading>>Why Are the Online Brokers Going Commission Free?
Free Stock Bonus
New Robinhood customers can get a free stock when they sign up and link their bank account to the app. Your stock reward ranges from $5 to $200, and you get to pick from 18 different companies for the actual stock you receive.
This is a nice perk to kickstart your trading. Just note that there’s a 98% chance your reward ranges from $5 to $10.