Traditional online brokerages were once intimidating to the rookie investor, so many flocked to Robinhood when the mobile-only brokerage announced new, revolutionary features in late 2014. Robinhood attracted these young stock market investors with an easy-to-use mobile app and commission-free trades.
To sweeten the deal, Robinhood didn’t require account minimums, so even investors with limited capital could start investing. Gone were the restrictions of many investing platforms with account minimums and hefty trading commissions. Young people could trade stocks and cryptocurrency from their phones with little money upfront.
Things began to change for Robinhood with the meme stock rallies that took over the market during the COVID-19 pandemic. While the commission-free trading app brought in millions of new investors, many were left feeling disenfranchised when Robinhood restricted meme stock trading.
Many of these people were intent on turning investing into a mass movement and felt betrayed by Robinhood’s reaction.
As a result, Robinhood lost $3.69 billion in 2021, leading many investors to seek alternatives. FINRA also fined Robinhood $70 million for misleading customers and system outages that impacted investors. Many accused the company of improperly educating its clients.
Critics of Robinhood were upset with how the company handled these meme stock rallies. They felt Robinhood misled rookie investors about margin trading, encouraging them to treat investing like some game.
In response, the company invested in educational resources for investors and additional customer service staff. However, many feel that Robinhood should’ve made these moves much sooner, and many people are migrating from the popular investing app. While Robinhood remains a great option for new investors, it’s not the only one out there.
Best Robinhood Alternatives
Over the years, as demand for platforms like Robinhood has surged, several competitors have emerged. Here are ten top Robinhood alternatives to consider if you’re shopping for an online broker like Robinhood.
|Q.ai||Ally Invest||Webull||Stash||Stockpile||SoFi Invest|
|Trading fees?||$0||$0||$0||$0||$0||$0||$0||$0||$0||$0.99-$3.99 plus a 3% debit/credit card processing fee||$0 for stocks and ETFs. 1.25% for crypto trades.|
Fidelity is one of the largest brokerages in the US, with over 34.4 million individual brokerage accounts. While Robinhood is often the go-to beginner investing app, Fidelity has multiple options, from IRA accounts to research tools to help you make informed decisions – something Robinhood doesn’t provide.
Fidelity also has a $0 commission fee for stocks and ETFs, no account minimum to get started, and a highly-rated mobile app. Unlike Robinhood, Fidelity does have a $0.65 options contract fee.
Fidelity has many investment options with over 10,000 mutual funds, plus its Fidelity Go service for those looking for an affordable robo-advisor (with no fees for account balances under $10,000).
One drawback, Fidelity doesn’t have the same simple user experience as Robinhood, making it slightly more intimidating to use at first. You won’t find any crypto here either, as the brokerage doesn’t allow for cryptocurrency trading.
However, the Wall Street Journal recently reported that Fidelity is considering offering cryptocurrency, and the company announced earlier this year that corporate clients could add bitcoin to their 401(k) plans. Currently, users can purchase a crypto industry ETF.
2. Charles Schwab
Charles Schwab is a viable alternative to Robinhood because you can manage all your finances with one login. Charles Schwab is a major brokerage that has worked on keeping up with the fintech space, updating its mobile app, and offering fractional shares. In addition, Charles Schwab offers $0 commission stock and ETF trades along with no account minimum to start investing.
Like Fidelity, Charles Schwab charges a $0.65 per contract fee for options, and the platform doesn’t allow cryptocurrency trading.
What helps Charles Schwab stand out is its educational resources for investors, assisting clients in learning more about general investing and specific stocks. The company offers access to traditional financial advisors and extended customer service with 24/7 options.
While retirement may not seem like something younger investors are thinking about, Charles Schwab is the leader in that space. Since Robinhood only offers a taxable brokerage account, consider Charles Schwab for the variety of individual retirement accounts if you’re planning life after a career.
Public launched in 2019, and the company has raised over $300 million from investors like Will Smith, Diddy, and even Tony Hawk.
Public is similar to Robinhood in offering free stock trades, an excellent mobile app, fractional shares, and cryptocurrency trading. However, neither service is known for its robo-advisors or automated investment options.
Public stands out for its social trading platform, which lets users gain insights from other investors and experts. In fact, Public is designed to be a social investing platform so users can join community groups and follow others’ portfolios. This community aspect has helped Public position itself as a viable Robinhood alternative.
The most distinct feature of Public is that they don’t participate in the controversial Payment for Order Flow (PFOF). Instead, Public has a tipping option in the app, an optional commission structure. This structure allows for more transparency and signifies that the company operates based on clients’ best interests.
Unlike Robinhood, Public does charge a markup between 1-2% for cryptocurrency trades, so you will end up with a reduced amount of crypto for every purchase.
Public is ideal for new investors with a small budget looking for something with a built-in community. Let’s face it, we live in a social world and want to know that we’re not alone in our financial actions.
4. M1 Finance
M1 Finance offers a hybrid model with traditional investment services and a robo-advisor feature. M1 Finance’s hybrid platform is all about total control and automation of your wealth as the company encourages customized portfolios and automated contributions.
M1 Finance isn’t just a mobile brokerage – it offers complete banking services, too. The M1 Owner’s Rewards Card provides up to 10% cash back, and its checking account pays a whopping interest rate of 2.5% APY.
M1 Borrow services allow the use of margin loans for anyone looking to leverage their investment for increased capacity or to find additional funding. You can use up to 40% of your portfolio’s worth at 6.5% interest.
Finally, M1 Finance uses a unique pie chart system for robo-advisors to give users a say in where their money is invested. M1 gives you the tools and research to allow you to create your pie with the stocks and ETFs of your choice, or you can choose one of the premade expert pies. Once you’ve decided which pie to go with, you can automate your contributions.
Remember that M1 Finance doesn’t allow quick transactions like Robinhood, so it’s not suitable for day traders or those looking to buy and sell stocks often. The platform is better suited for longer-term investors near the beginning of their investment journey.
Like Robinhood, you can purchase fractional shares if you’re looking to invest in more prominent companies but don’t have large amounts of capital. M1 Finance offers brokerage, crypto, and retirement accounts, so you have options to suit your investment needs.
Learn more in our M1 Finance review.
If you want to take the guesswork out of investing, you can use artificial intelligence to do the work for you. Q.ai’s unique investment kits use AI to manage your money.
Q.ai’s investment kits are custom-built with a combination of stocks and ETFs. These kits have themes such as energy, cutting-edge technology, and even guilty pleasures. Fund your account, choose your investment kit, and let AI do the work.
There are four investment kit categories:
- Foundation Kits include options like emerging tech and global trends.
- Limited edition Kits based on current events, from inflation protection to Bitcoin’s breakout.
- Specialty Kits range from crypto to clean-tech.
- The Community Kit uses data and analysis from Forbes to invest in US and global stocks, and ETFs.
This Robinhood alternative is ideal for anyone looking for a hands-off approach to investing. What helps Q.ai stand out is that it’s completely free, and you can hedge your risks during volatile times in the market. Plus, Q.ai updates its kits weekly, so you can stay on track with trends.
AI-powered investing taps into technology to handle everything for you, from risk assessment to analyzing the correlation to other kits. You can customize your portfolio to match your risk tolerance and investment preferences, and Q.ai offers portfolio protection to forecast future risks in advance. You also don’t pay any fees, and there are no charges for investing.
6. Ally Invest
Ally Invest is a viable Robinhood alternative because it’s a full-featured brokerage and a bank, meaning you can conduct all your financial transactions under one platform. Ally Invest has adopted $0 stock and ETF commissions, plus no account minimum to get started. The company does charge a $0.50 per contract fee for options trades.
Unlike Robinhood, Ally Invest is more of a full-featured broker with access to every kind of account type that you could want. You could open a banking account, buy mutual funds, and start a retirement account. Ally Invest also provides a robo-advisor service for those wishing to put their investment on auto-pilot.
Ally offers an excellent selection of mutual funds (over 12,000 options) but doesn’t have cryptocurrency trading on the platform, unlike Robinhood.
Ally offers the following options for those looking for an investing platform:
- Self-directed trading: Manage your portfolio with $0 commissions for buying stocks or ETFs. There’s no account minimum required to get started.
- Robo-portfolios: Start with $100 and choose a portfolio managed by a robo-advisor. The four options include core, income, socially responsible, and tax optimized.
- Wealth management: Set up a consultation for a customized portfolio when you have $100,000 to invest.
For more information on Ally Invest, read our full review.
While Robinhood targets rookie investors, Webull is designed for sophisticated investors looking for professional tools. Webull has a robust screener, so you can analyze your investment options by looking at technical trading data. Many investors claim that Webull has one of the best free stock analysis tools.
The platform educates investors about the stock market and investing. Most notably, you can invest within Webull’s investment simulator to ensure you’re comfortable with a decision without risking real money. As the meme stock rallies have shown us, investors sometimes need to be aware of the risks involved with investing in the stock market based on speculation.
Webull allows you to track stocks with custom alerts and updates, making it the perfect option for those new to investing who wish to explore their options.
One significant difference between Robinhood and Webull is the latter allows for short selling if you open a margin account, as it’s more aimed at intermediate investors.
Stash is geared more towards newer investors looking to hold long-term investments rather than veteran stock pros trying to do complicated things like day trading or options contracts. It offers stocks and ETFs that you can invest in, but don’t expect to go hog-wild: there are only 250 options. You will get some assistance in picking which choices are best for you, which is why it’s better suited for people looking for a simple experience.
It also offers a unique feature we haven’t seen with other Robinhood alternatives: a debit card that offers bits of stock as a reward, specifically 0.125% – 5.000% back in stock from the big companies you buy from. For more information, check out our full Stash review.
Fractional shares of stocks are all the rage right now, but Stockpile was one of the first investing companies to roll this out. While you can use Stockpile for most newbie investing needs, it’s marketed more as a gift card service.
You can buy gift cards and “gift” fractions of stocks for interesting companies like Disney – or yes, even GameStop – and give them to friends and family. It’s a handy method to get kids interested in the stock market and investing. Learn more in our Stockpile review.
10. SoFi Invest
Active Investing is geared towards novice investors who want to play around a bit with buying and selling but aren’t big-time investors yet. For example, fractional shares are only traded once daily, when their price may change. With Automated Investing, SoFi Invest helps guide you through creating and implementing an automated investing plan based on your goals.
Most trading platforms are now competing for rookie investors by offering commission-free trading, easy-to-use mobile apps, and the ability to purchase fractional shares.
Best Robinhood Alternatives: Final Thoughts
There you have it, our list of the best Robinhood alternatives. As you can see, traditional brokerages have caught up with the features that first made Robinhood attractive to new investors. Most trading platforms are now competing for rookie investors by offering commission-free trading, easy-to-use mobile apps, and the ability to purchase fractional shares.
With many Robinhood users looking for alternatives after the Gamestop stock phenomenon in early 2021, several trading platforms may stick out for their quality educational investment resources.
Your needs may change as an investor, so it’s crucial to weigh the pros and cons of multiple trading platforms until you find one that best matches your current financial situation.