These days it seems like everybody is investing in the stock market, and it makes sense too, even the little investments can garner a large return if you even barely know what you’re doing. However, when faced with the choice of choosing a stock trading app, many of us shy away from the big names due to the high fees charged for purchasing or selling stocks, and I did the same. However, one app named Robinhood charges no commission fees, is reliable and used by millions, and allows you to start trading stock essentially overnight!
|VigilantCMDR from https://www.vekhayn.com has Robinhood’s stock investing platform as his daily portfolil.|
Wait What? Free? This has to be a scam.
Nope, it’s not a scam. I was skeptical at first when I first heard of the app years ago when it first released and in fact refused to use it because I thought it was a way for someone to steal my identity. However, turns out it wasn’t. Robinhood is a safe app used by millions and is regulated by the U.S SEC, SIPC, and is apart of the Financial Industry Regulatory Authority, boasting a high credibility and safety net if Robinhood ever files for bankruptcy, all according to Investopedia.com.
So How Do They Make Money?
We have all heard the saying, if a product is free, you’re the price. Which usually means the company is selling your personal information, however, Robinhood actually has no need to do that because they do make a very tiny bit of money on the stocks you purchase and from users purchasing the Robinhood Gold. Robinhood makes tiny amounts of money, only about $0.02 per $100 according to Investopedia.com, but if there is a large volume of users trading everyday that can add up to be quite a bit. It is also reported that the money in your account they earn interest on the cash in your account that hasn’t been invented yet, likely loaning it to others to buy on margin (your cash is always available to be withdrawn whenever, it’s like a savings account).
I Read Online They Sell Your Information…
While Robinhood has no evidence they do or do not sell your personal information, all the other stock brokerages do sell your information and at a much higher price of oftentimes $7 per quarter.
How Do I Use It?
The app is incredibly easy to set up, you can signup here online (which I find easier to do) then download the app onto your phone(via App Store or Google Play) to start investing. You simply need to verify your bank account information then you can start buying stocks right away with zero commission fees, you can even invest in margin while the funds are being transferred from your bank.
You can trade most stock and even cryptocurrency on the map for a diverse portfolio. When you want to buy or sell stocks the order is placed and happens very quickly, often times within seconds to minutes. The app gives you lots of information about how your stocks are performing and gives lots of information about your revenue lost/generated.
When it is time to withdraw at the end of the day, you simply hit withdraw and type the amount of money you would like transferred to your bank and it will be there within a few business days.
Tax and Security
Robinhood provides an easy to access tax report and history for you, so you can easily find out what to write on your annual report so the IRS doesn’t hunt you down.
The security on the app is incredible, even if you tab out of the app for a second you can set it up so you require fingerprint or face scan verification. It also has features that will lock your account if it sees you buying/selling lots of stocks at a time or on the same day and contacts you to ensure it is not fraud (or if the staff is wise enough, a bad decision!).Robinhood also boasts a mighty “industry-standard BCrypt hashing algorithm” for your passwords and never stores your bank information.
Who is The App For?
The app while being cheap and convenient, is likely not for the most advanced investor. If you are a very advanced investor you may find it better to use an online trading portfolio that gives you more features for the stock market. However, for most stock traders that aren’t trading millions a day Robinhood will be just fine and save you lots of money in the long run.
An app that is incredibly cheap, safe, and convenient and can get you starting investing right away is an app anybody interested in investing needs. You can again sign up for Robinhood here. Good luck trading!