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Robinhood Review: A Comprehensive Guide for Beginners

Updated: Jun 21, 2023

Robinhood Dashboard
Robinhood Dashboard


Robinhood is a pioneer in the $0 commission trading space. They have developed a robust set of features that rivals most investment platforms. If you want to sign up and skip the article, click here.

Introduction: Robinhood Review

Investing in the stock market has never been more accessible, thanks to apps like Robinhood. Known for its easy-to-use app interface and commission-free trading, Robinhood has been a go-to option for many newbie investors. However, the key question remains - is Robinhood the ideal investment platform for you? In this article, we offer a comprehensive review of Robinhood, tackle common queries, and compare it to other alternatives in the market.

Understanding Robinhood: A Guide for Beginners

Robinhood, founded in 2013, is a mobile app that has simplified investing in stocks, options, and cryptocurrencies by offering commission-free trading. It's an attractive choice, especially among young and novice investors seeking an affordable entry point into the stock market.

Robinhood has been a game-changer for me and many others by eliminating the fees that once made traditional investment platforms an expensive venture. Its focus on commission-free trading attracted a large user base of tech-savvy investors seeking a more economical and streamlined investment process.

Moreover, its intuitive interface and unique features such as cash management and fractional shares make it a versatile platform even for beginners. The success of Robinhood largely comes from its innovative business model, user-centric approach, and its appeal to a new generation of investors seeking an affordable and user-friendly investing platform.

Robinhood Minimum Deposit

There is no minimum deposit required to open a Robinhood account. However, you will need to deposit funds in order to start trading.

Who founded Robinhood?

Robinhood was founded in 2013 by two entrepreneurs, Baiju Bhatt and Vladimir Tenev. They had both previously worked in finance and were frustrated with the high fees and complicated processes associated with traditional investing platforms. They wanted to create a user-friendly platform that would make investing more accessible to everyone, regardless of their financial situation.

One of the keys to Robinhood's success, and the reason I originally signed up, has been its focus on providing commission-free trading. This was a groundbreaking move in the investment industry, where high fees had been the norm for decades. In my first 3 years of investing, I spent more money on the fees associated with trading than on the actual trades I made. By eliminating these fees, Robinhood was able to attract a large user base of young, tech-savvy investors who were looking for a more affordable and streamlined way to invest.

In addition to its low fees, Robinhood has also been successful because of its user-friendly interface and mobile app. The platform is easy to use, even for beginners and allows users to trade stocks, options, ETFs, and cryptocurrencies all in one place. Robinhood has also added unique features like cash management and fractional shares (I take advantage of both), which have helped to differentiate it from other investment platforms.

Overall, Robinhood's success can be attributed to its innovative business model, its focus on user experience, and its ability to appeal to a new generation of investors who are looking for a more accessible and affordable way to invest.

Pros and Cons of Robinhood

Like any platform, Robinhood comes with its advantages and drawbacks:


  • Commission-free trading

  • User-friendly interface

  • Fractional shares buying option

  • High-yield savings account

  • 1% match of IRA contributions


  • Limited research tools

  • No options for mutual funds or bonds

  • Inadequate customer service

  • No dividend reinvestment program

Robinhood doesn't impose any hidden fees. However, investors should be aware of certain costs like margin trading fees and options contract fees.

Does Robinhood have hidden fees?

No, Robinhood doesn't have any hidden fees. However, there are some fees that you should be aware of, such as margin trading fees and options contract fees. These fees are clearly outlined on the Robinhood website.

Robinhood Features

Over the years, Robinhood has evolved into more than just a platform for commission-free stock trading. Here are some of its key features that make it an attractive option for beginners and seasoned investors alike:

  • Commission-Free Trading: Buy and sell stocks, options, ETFs, and cryptocurrencies without paying any commission fees.

  • User-Friendly Interface: Easy navigation for beginners.

  • Cash Management: Earn interest on your uninvested cash, with no minimum account requirements or fees.

  • Fractional Shares: Ability to buy and sell fractional shares, making high-priced stocks accessible to everyone.

  • Watchlists: Track your favorite stocks and ETFs easily.

  • Robinhood Gold: A premium service offering extended trading hours and margin trading.

  • Investment Education: A range of resources to help investors make informed decisions.

Robinhood vs Traditional Investment Companies

While Robinhood has made its mark in the investment landscape, how does it stack up against other investment apps like Acorns or traditional companies like Fidelity or Vanguard?

  • Investment Options: Traditional investment companies offer more options including mutual funds and bonds.

  • Fees: Traditional companies may charge for trades or account maintenance, whereas Robinhood doesn't.

  • Customer Service: Traditional companies generally offer better customer service.

How Robinhood Generates Revenue

Robinhood's revenue model relies on several key features:

  • Commission-Free Trading: Robinhood enables users to trade without commission, making it an affordable option.

  • User-Friendly Interface: Designed for beginners to navigate easily.

  • Cash Management: Allows users to earn interest on uninvested cash.

  • Fractional Shares: Allows investing in high-priced stocks with less capital.

  • Watchlists: Enables tracking of favorite stocks and ETFs.

  • Robinhood Gold: A premium subscription with additional features.

  • Investment Education: Resources to help users make informed decisions.

By offering commission-free trading, a user-friendly interface, cash management, fractional shares, watchlists, Robinhood Gold, and investment education, Robinhood has become a popular investment platform for users looking for an affordable, accessible, and innovative way to invest.

How to Get Started with Robinhood: A Step-by-Step Guide

Whether you're a seasoned investor or just starting out, getting started with Robinhood is a straightforward process. Here's a step-by-step guide on how to set up and fund your account:

Robinhood Webpage
Robinhood Webpage

Step 1: Download the App or Visit the Website

First, you'll need to download the Robinhood app from the App Store or Google Play. If you prefer to use a computer, you can visit the Robinhood website and click on the "Sign Up" button.

Robinhood Account Creation Page
Robinhood Account Creation Page

Step 2: Create an Account

To create an account, you'll need to provide some basic information, including your full name, email address, and a strong password. Robinhood also requires your date of birth and social security number, as these are required by law for all brokerage accounts.


Robinhood Identity Verification
Robinhood Identity Verification

Step 3: Verify Your Identity

As part of the application process, Robinhood will verify your identity. This process usually involves providing a form of identification, such as a driver's license or passport, and may also involve answering questions about your personal history.

Step 4: Connect Your Bank Account

Once your account is set up and your identity is verified, you'll need to connect a bank account to fund your Robinhood account. To do this, go to the "Banking" section in the app, select "Link New Account," and follow the prompts.

Step 5: Fund Your Account

After connecting your bank account, you can transfer funds to your Robinhood account. This is done by selecting the "Transfer Funds" option in the app, entering the amount you wish to transfer, and confirming the transaction.

Step 6: Start Trading

Once your account is funded, you can start trading! To make a trade, select the search icon in the bottom center of the app, search for the security you wish to trade, select "Trade" and then follow the prompts to buy or sell.

Remember, investing always carries risk, and it's essential to do your research before buying or selling any securities. Robinhood provides some basic tools for research, but you may want to consult additional resources to make informed decisions.

By following these steps, you can get started with Robinhood and begin exploring the world of investment. However, always remember that investing in the stock market involves risks, including the potential loss of principal. As such, it's always advisable to learn about investing, understand your risk tolerance, and possibly consult with a financial advisor before making significant investments.


In summary, Robinhood, with its commission-free trading and user-friendly interface, offers a practical and economical platform for those looking to break into the world of investing. Although it has some limitations, it remains an attractive option for beginners and those looking to invest modest amounts without hefty fees.

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