Robinhood App Review: Are the Free Trades Worth It?

robinhood app review

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When it comes to investing, there are a lot of different ways you can go about it, but most of the time it’s best to go with a brokerage firm because they can manage your money and help you make the most of your investment.

However, if you’re new to the game, then you may be wondering how you can get started and where to look for some advice. Robinhood is an app that promises to make the investment process easier and more accessible to people, but does it deliver? In a word, yes, but that doesn’t mean that it’s the best option out there.

Robinhood Overview

One of the main selling points of this app is that it is mobile, convenient, and doesn’t charge any commissions. Also, there is no need to maintain a minimum balance (unless you have a margin account, but we’ll get into that later), so you can get started with just a couple of bucks if you want.

Unlike most other brokers, Robinhood is a mobile-only application, meaning that there is no other way to access your account and invest besides what’s on your smartphone. For those who are on the go, this can be a decent feature, but that also means that you are quite limited in how you can manage your funds.

Setting up is super fast and easy, and you can start investing after a few minutes. There are quite a few stocks and ETFs at your disposal, and since there are no commission rates, you can pick and choose with impunity.

robinhood app

What’s the Point?

Overall, it seems that Robinhood is reaching out to younger people and trying to make the investment industry more accessible and appealing. However, if you are serious about making money in stocks, then you will probably want to go somewhere that offers much more comprehensive resources.

Nonetheless, this app has some pretty decent things going for it, so let’s check out some of the better features that you get with it.

Free to Sign Up

Typically speaking, when signing up with a new brokerage service, you have to have a minimum amount to invest, and you are charged fees for every trade. These costs can range from about $10-$15 for mid-level brokers, and up to a couple hundred dollars or more for high-end firms.

Ultimately, this means that to get started you need at least $1000 or so to get the most out of your investment.

Unfortunately, because most Millennials don’t have that kind of disposable income, they are much less likely to start investing at all. That’s where Robinhood comes in. With its incredibly low bar of entry, anyone can get started and see how the stock market works.

For this reason, the app can be quite valuable to beginners or those who have limited funds with which to invest.

On the Other Hand…

You get what you pay for. In this case, since there are no commissions or minimum balances, the app is a “no-frills” kind of program, and it shows. So, while it can be an excellent way to break into the world of investing, it’s not conducive for a long-term strategy.

Streamlined User Experience

The other reason that Robinhood can appeal to the younger generation is that it is very mobile-friendly and allows you to pick ETFs quickly. However, considering that research is always the cornerstone of making a sound investment, this can be something of a double-edged sword.

Nonetheless, for investors who want to experiment and take minimal risks, this can be a great feature. Also, the fact that you can pick stocks and invest money on the fly means that the whole process is much simpler than it would be with a standard broker.

On the Other Hand…

Again, the key to making good stock picks is understanding as much about the market and the company as possible. Since Robinhood doesn’t offer a lot of details and resources, this can be a huge blind spot for new investors.

That being said, if you’re someone who is already knowledgeable about the market, then you can take advantage of the speed and efficiency, as well as the lack of commissions. This way, you can make more trades without having to spend a ton of money in the process.


If you want to get more out of the app beyond simple point-and-click investing, then you can sign up for one of the several different upgrades that will enable you to do more with your account.

Robinhood Instant

The goal of this add-on is to allow you to reinvest your earnings immediately. Rather than having to wait for your funds to clear, you can take them and put them back into your stocks as soon as they arrive.

This ability does mean, however, that you may be subject to margin trading regulations, so you want to keep that in mind. Also, you may have to be on a waiting list before you can access this feature, so don’t expect to have it right away.

Robinhood Gold

This add-on is designed to function more like a traditional broker. Even though it still doesn’t offer as many resources as you would get from other firms, you can open a margin account, which means that you are investing with borrowed money from Robinhood. It also means that you have to have a minimum of $2000.

With this premium plan, you also get extended trading hours (9 a.m. – 6 p.m. Eastern), and you have to pay monthly rates based on your investment amount. They have a tiered pricing plan, which starts at $6 a month and goes up to $200, based on how much “buying power” your margin account has according to the app’s listing.


  • Free to sign up
  • Easy to use interface
  • Premium options available
  • No commission
  • Mobile-friendly
  • Ideal for new investors

What’s the Catch?

As you can guess, there are quite a few issues with Robinhood that can almost ruin the whole experience. Overall, if you are looking for a viable method for investment, you won’t get too much out of this app. Here’s where it falls short.

Limited Investment Choices

There are only two things you can invest in on Robinhood: stocks and ETFs. So, if you prefer to put your money into other resources like mutual funds, options, or bonds, then you are out of luck. Perhaps there will be more choices offered in the future, but for now, that’s all you can access.

That being said, there are still quite a few stocks from which to choose through the app (over 5000), but the lack of variety can be a bit problematic for those who want to step up their investment game.

No Automatic Dividend Reinvestment

With most brokers, you can opt to reinvest all of your dividends from a particular stock automatically, which is a common strategy to help increase your overall earnings. However, with Robinhood, it credits them to your account instead, meaning that you have to put it back in manually. While the Instant feature helps make this process a bit faster, it’s still not as convenient.

No Resources

Interestingly enough, despite the fact that this app markets itself to new investors who want to get into trading, it doesn’t offer anything in the way of advice, analysis, or research. So, unless you have your ear to the ground in the investment world already, you’re mostly picking stocks blind. Even with the upgraded Robinhood Gold account, you don’t get much in the way of reports or educational resources, so you still have to do the legwork on your own.

Limited Transfer Options

If you already have a brokerage account elsewhere, then you won’t be able to move funds into Robinhood. However, you can transfer money from your Robinhood account to others, for a flat rate of $75. For brand-new investors, this probably won’t be a big deal, but it again shows that there is a relatively small amount of convenience built into the app.

Scarce Customer Service

What happens if you have questions or want to find out more details about anything related to the app? Well, you have to submit a query to Robinhood’s support team, which can be rather lax on prompt replies, depending on the time of day. This seems to be a symptom of the “free trading” model since they can’t afford to maintain a significant full-time staff.


  • Limited investment opportunities
  • Lack of ACAT options
  • Subpar customer support
  • Only one account option available
  • No resources and analysis

Bottom Line

When compared to other mobile trading apps, the only thing that keeps Robinhood competitive is the fact that you don’t have to pay any commission on your trades. So, if you’re an investor looking to cut down on your overall trading costs, then you may like Robinhood.

The most ironic thing about this service is that it seems to favor those who know how to invest (hence the lack of educational material), but it doesn’t offer any services that they would want.

Conversely, by attracting those who don’t know what they’re doing and neglecting to provide any resources to help them get started, it will probably turn people off of trading since they are essentially doing it blindly.

In the end, you can potentially make Robinhood work for you, but is the extra effort worth the free commission? That’s up to you.

3 thoughts on “Robinhood App Review: Are the Free Trades Worth It?”

  1. I’m new to investing, and this app totally turned me on to it. I enjoyed reading your article and the one prior. Thanks-

  2. Hi Chris, thanks for this article about the investing Robinhood app. When you mention lack of resources to stay informed about the market, are there say three or four places you might suggest? Places where a curent sporadic follower of the market can begin to regularly start visiting to gain expertise & knowledge? Thanks,

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