I really wish Robinhood supported DRIPs, I'd move to them in a heartbeat. It seems like such low hanging fruit for a brokerage, way less work than crypto trading. Just not sexy enough I guess.
Stock trade app Robinhood raising at $5B+, up 4X in a year
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Re: Stock trade app Robinhood raising at $5B+, up 4X in a year
#112Earlier quoted context omitted.
> My concern is that overall, the product and marketing seem to be geared towards speculative, short-term trading. When I first signed up, the app was recommending that I check out stocks like Apple, Netflix, and Snapchat, not index funds. There's a broad spectrum of public companies obviously, but it's hard to see $AAPL as speculative in the same sense that people call penny stocks or cryptocurrencies speculative (i…
Washington Mutual, Bear Stearns, Lehman Brothers, General Motors, Fannie Mae, Freddie Mac are all good examples of why you should avoid individual stocks, even if they are "blue chip".
Amazon, Alibaba, Mercado Libre, and Netflix are good examples of reasons not to avoid individual stocks.
More than 90% of my investments go into index funds and 10% into individual stocks, but if hindsight was 20/20 it would be 100% into my individual stocks and I’d be retired on my own private island today.
Re: Stock trade app Robinhood raising at $5B+, up 4X in a year
#113Given the complexity of running a stock brokerage service I don't think it's appropriate to call Robinhood an "app"
Re: Stock trade app Robinhood raising at $5B+, up 4X in a year
#114Earlier quoted context omitted.
Vanguard charges no fees for buying/selling their owns ETFs. I believe Schwab and others do as well.
While this is a great point, the casual segment of the customer base that is being discussed would certainly not have enough awareness of this fact. At the very least, I didn't even though I do trade ETFs and large cap stocks casually...
I am sorry but "casual investors" should be doing long term buy and hold because if you can't be bothered to spend 30 minutes on research to compare brokerages, I am genuinely horrified at the idea of you doing anything other than buying and holding an index fund.
Robinhood's encouragement of the instant gratification, poorly researched trades is going to end badly for many of it's customers when we enter a bear market.
Re: Stock trade app Robinhood raising at $5B+, up 4X in a year
#115Given the complexity of running a stock brokerage service I don't think it's appropriate to call Robinhood an "app"
Until they're accessible in a cross platform way, as far as the consumer is concerned yeah they're just an app. If Facebook or Amazon were only accessible through an Android or iOS app, it'd be the same, no matter what investments they're making behind the scenes.
Re: Stock trade app Robinhood raising at $5B+, up 4X in a year
#116Earlier quoted context omitted.
Betterment, where you pay an extra quarter percent to buy Vanguard funds.
That's better than the alternative of not investing at all because Vanguard is not user-friendly. And I know that's possible because I have friends who were in that situation. If you sign up with Vanguard, you still have to pick which fund(s) to buy. If you don't know anything about investing, that can be a daunting task. With Betterment, the only decision you have to make is the percentage split for stocks vs. bonds…
Isn't that why Vanguard has their Total Stock Market and Total Bond Market funds? Basically, they're the "invest in these if you don't want to bother" funds.
Re: Stock trade app Robinhood raising at $5B+, up 4X in a year
#117Earlier quoted context omitted.
Have you ran the math on how much that "user friendly" layer is costing you? I adore nice UIs, but I love even more keeping my money. Vanguard is really not that hard to use, and for how often you need to mess with it I don't think it's worth to spend more just to have prettier graphics.
I have both Betterment and Vanguard accounts. I haven't bothered to consolidate yet because Betterment is trying to add value to justify the fee with features like tax loss harvesting, and I haven't decided if it's worth it or not. With regards to my friends though, my priority was to get them to invest in the first place, and the user friendliness of Betterment helped a lot.
Your friends can't exercise some level of long term financial responsibility unless they're presented with pretty graphics and a slick UI?
The lack of financial education in the US really makes me sad sometimes. And it pisses me off that companies like RH will take advantage of that.
Re: Stock trade app Robinhood raising at $5B+, up 4X in a year
#118What people don’t realize is that these 0$ trading commissions just make it up in their routing of the transactions. You’re not going to get the best price. Use interactive brokers if you want a good price. Flat fee is higher but the trade routes are great.
Eh, use a limit and you’re fine
Re: Stock trade app Robinhood raising at $5B+, up 4X in a year
#119What people don’t realize is that these 0$ trading commissions just make it up in their routing of the transactions. You’re not going to get the best price. Use interactive brokers if you want a good price. Flat fee is higher but the trade routes are great.
I mean, average portfolio size for Robinhood users is probably in the $1k-10k range. How much does your 22 year old cousin care whether she pays $325.60 or $325.62 for a share of TSLA? For individuals it’s negligible, but for the HFT firms whose kickbacks make up most of Robinhood’s revenue, this adds up.
Yeah, worst case scenario use a limit
Re: Stock trade app Robinhood raising at $5B+, up 4X in a year
#120I appreciate the zero commission trading, but at the same time, I'm worried about the attitude towards "investing" that they promote. Most people should arguably be putting their money into index funds and holding for the long term[1], not picking individual stocks and following price movements on a daily basis. I wouldn't criticize anyone for speculating (i.e. gambling) with money they can afford to lose. I've done…
> Most people should arguably be putting their money into index funds and holding for the long term I think Robinhood is great for that! Zero commission means you can afford to buy small amounts without worrying about fees eating into your principal too much. You can put in $250 every pay period and buy a share of $SPY without losing ~3% to fees. With commissions involved you'd want to wait until you could afford a l…
You can open a Vanguard account and buy $VOO for zero commission too.