so i've been investing with the robinhood app for over four years now and
i've seen a lot of the big changes happen on the platform
and that's why i want to make this video today because i want to go over the
biggest features that have changed with robinhood
and i also want to talk about the pros and cons because honestly robin hood
isn't for everyone but in my opinion if you are a beginner
to an intermediate investor they are a very good brokerage to start with
now to start off if you guys don't know anything about robinhood they're just
another brokerage account meaning you can buy and sell stocks on
the stock market but the big difference with robinhood is
that they do not charge any commissions when you buy or sell stocks now that was
the biggest thing that they first came out with they were kind of a
breakthrough in the market because they didn't charge a fee now
normally when you buy stocks you have to pay between five to ten bucks
just to buy the share and then when you sell the share you have to do the same
thing regardless if you're selling one or a
thousand shares it doesn't matter you always have to pay that commission
but with robinhood there are no commissions so you can buy
and sell and it doesn't cost you anything so essentially robinhood makes
it a lot easier for beginners to get started in the stock market
especially if you don't have a lot of money to invest with because if you're
losing all that money from commissions then those are just gains that you're
losing out on and that's a lot of money if you don't have a lot of money to
invest with as far as a percentage goes now the other thing about robinhood is
that they don't require a minimum balance
meaning you don't have to have a hundred dollars or five hundred dollars to get
started they only require you to have at least
one dollar to get started investing and that is a really good thing
because it's so easy to get started in the investing world
now obviously if you only have a dollar to invest in the stock market
you're probably not going to make much money even if you invest in the best
investment that's out there but the point is is that robin hood just
makes it so easy to get started in the investing world
that you can start to learn how to do it and then over time as soon as you build
that knowledge and you get more experience
then when you have more money to invest in the stock market hopefully that can
reflect in the gains that you have throughout
the investing world robin hood allows you to trade common
stocks etfs reits and then they've also got free
options trading and cryptocurrency trading as well so pretty
much any type of investment you want to get into
robinhood has it for you and in my opinion they also make it very easy to
search for different companies on the stock market
and related to those companies you can read different articles that they have
posted there and then you can also check basic
statistics about those specific companies
now if you are brand new to robinhood they'll actually give you a free stock
just for signing up and the share is going to be random so
you could end up with something that's probably worth about less than 10 bucks
and then some of the shares i've heard of people getting facebook or apple
and those are obviously worth a lot more so to get your free stock i do have a
link in the description you can check that out if you want to
it's a referral link so i'll get a free stock and you'll get a free stock just
for signing up but you might as well if you're brand
new to them now the best feature in my opinion that robin hood finally came out
with is the ability to buy fractional shares
and this is a big deal because you no longer have to buy
individual shares of companies you can buy small little pieces of them
for as little as a dollar so if you want to get into any company out there
for as little as one dollar you can because of the fractional share ability
that's finally available because if you wanted to buy one share
of chipotle today it would cost you over 1200 bucks just
to get that one share and from an investing point of view
that's a lot of cash just to get into one investment
so with fractional shares you could buy into chipotle for as little as a dollar
and you could be invested in them but you don't have to come up with that
initial amount of cash just to get the one share and then the
other cool thing about the fractional shares is that you can turn on a drip
program for your dividends which stands for a dividend reinvestment
plan and what this means is that if you get paid a dividend
that money can actually go right back into the stock
automatically instead of just sitting in your cash account
because if you ended up getting a dividend for let's say 20 bucks
then that 20 dollars would just sit in your cash account until you decided to
do something with it but with the drip program turned on and
because of the fractional shares that twenty dollars can actually go back
into that company automatically and so that money can be reinvested as
soon as possible rather than just sitting there and
having you have to manually check on it and invest it
now if the fractional share stuff and the drip program seems a little bit
complicated don't worry i do have a video that i'll
link up at the end of this video that explains exactly what those
features are so if you guys need more details
on that i will have another video linked up robinhood also has what they call a
cash management account which is basically just a bank account so you can
actually do direct deposit you can pay your bills
do all the types of things that you do through your checking account and then
it'll also come with a debit card that you can use at 75
000 atm locations without any fees and then obviously you can use the debit
card on all your other purchases as well and then the other cool thing about
their cash management account is you can actually earn interest with your
uninvested cash but the only problem is right now it's
only at 0.3 percent which is still better than what you're
going to get from most checking in most savings accounts
but it's just not really that competitive right now and that's as of
march of 2020 that they have listed so it's probably even worse right now
considering all the fed's interest rates have gone down
and then another cool feature on the investing side of robinhood is what they
call instant deposit and this is very handy
because if you want to make a move on the stock market today
but you don't have the money in your account then you're going to have to
transfer that money from your bank to your brokerage account and that can
typically take up to a couple days just for the money to settle but with
robinhood they'll actually do the instant deposit like i said
and they'll have up to a thousand dollars that you can use instantly
to trade with on the stock market even though that money hasn't settled with
your bank so it means if you need four hundred
dollars right now and you do have that much in your bank account
then you make that transfer the 400 goes into robinhood
and you can invest with it instantly even though the money hasn't actually
settled yet just make sure that when you transfer
the money to robinhood that you actually have that amount of money
in your bank account because if you do end up overdrafting
robinhood isn't going to like that and you can actually be penalized and lose
that feature so just make sure that you have that
much money when you're doing an instant deposit
and then another cool thing about robinhood is if you sell your shares
today you can actually use that money as soon as those stocks sell
to buy more stocks in the stock market so the cool thing about that
is typically when you sell a share you have to wait three trading days just for
that cash to settle but robinhood will put that into your
buying power kind of like the instant deposit feature
and with that buying power you can trade on the stock market even though
it hasn't settled technically so in a nutshell if you sold a thousand dollars
worth of shares then you'd have a thousand dollars of instant buying power
that you could use to trade on the stock market even though that
money hasn't literally settled yet now just keep in mind that if you do
need to withdraw cash from robinhood they have to abide by all
the regulations in the stock market and a lot of those regulations and rules
can keep you from getting your money quickly so if you're in a pickle and you
sell some shares you are not going to be able to use that
money for at least three trading days and then you got to wait another couple
days just for the money to get to your bank
so if you are in an emergency just keep in mind these are rules for
every single brokerage there's nothing you can do about it you don't have to
get mad at robinhood because they're just following the same
rules as everyone else usually you're not going to have to wait
more than about a week to get the money from robinhood to your bank account
but like i said they do have to follow the rules and the regulations
so it's not just quick money it's not fast liquid money like you have in your
checking your savings account that's where you want to keep your
emergency fund don't keep that inside of robinhood
and at this point in the video if i am making sense about what i'm talking
about can you please just comment down below
and say i got it that way i can tell based on an audience
if what i'm saying is making sense to you guys so thank you very much
robinhood also has an optional service called robinhood gold
and this is a subscription that's five bucks a month that'll actually give you
a lot of different perks and the first 30 days is free if you
want to check it out but i'll go over all the perks right
here for you guys you'll get access to morningstar research reports
nasdaq level 2 market data margin trading
and then you'll also have access to higher instant deposits as well
just for the five bucks a month as far as the instant deposits go you're gonna
get up to five thousand dollars in instant deposits with robinhood gold
and then after five thousand dollars you can actually max it up to fifty thousand
dollars but you have to have that amount in your
portfolio in order to access the 50 000 in instant
money so as an example if you deposited 25 000
from your bank account to robin hood then with that perk you'd actually have
instant access to that 25 000 without having to wait as
long as you had 25 000 or more in your portfolio to match
it and then also with robinhood gold you're
going to have access to margin trading and if you guys don't know what that is
it's basically just borrowing money to invest in the stock market
and then you have to pay it back with an interest rate kind of like a loan
now with robinhood gold you're gonna have access up to your first
thousand dollars of margin trading for free that's with the five dollar
subscription service and then after a thousand dollars you're
gonna be at a five percent annual interest rate
and that's after the thousand dollars now there is a lot of risk associated
with margin trading so please do your homework if you're going to be taking
advantage of that but just so you're aware robin hood does
offer margin trading as long as you're subscribed to
robinhood gold overall i feel like robinhood is a very good brokerage to
invest with especially if you're a beginner
just because they make it so easy to get into the stock market
but there are a few cons when it comes to different investing styles and i'm
going to go over those right now because these really kind of can make or break
robin hood for some types of investors now the
first con that i want to mention with robin hood is the fact that most of the
investments that you can make with them are not automatic meaning you're going
to have to manually invest your funds into the stock market and nothing is
just a set it and forget it kind of thing now they do have the drip program
that will automatically put your dividends
back into that specific company but that's really the only automatic thing
they have you can also do automatic deposits from
your bank so for instance you could say a hundred
dollars on the 15th of every month that'll go into your cash account but
that money is not going to be invested for you
so as far as a set it and forget it approach robinhood is not the kind of
platform you want to be using if you're not going to be manually
investing on your own now another con with robinhood is that when you're
researching companies you're not going to find a lot of data
on those specific companies because they don't offer it so if you're
looking for dividend history or companies fundamentals different
financials and things like that you're not going to find much of that
information robinhood does give you a little bit of information
but just not much so in that sense you are going to have to look elsewhere
if you want to do more research on a specific company
because you can't just deep dive inside of robin hood on all the companies that
you're looking into and then as far as customer service goes
this is a big deal for some types of customers because robinhood really lacks
in the customer service area because as far as i'm concerned
everything that i've researched and all the playing around that i've done with
robinhood i haven't found that they actually have
a hotline that you can call to get help with
now if you do need help with them you have to email them and then you have to
wait for a response and sometimes this could be very
frustrating if you need an issue solved right now but for the most part i
haven't run into any of those issues everything that i've done on the trading
side has worked smoothly i haven't personally had a problem but
for some of you that might run into an issue
this is an issue if you can't call them on the phone
and fix your problem quickly so just keep that in mind i don't know if they
have a phone line maybe they do but i haven't personally found one so
keep that in mind their customer service kind of lacks
now the biggest issue that i personally have with robinhood
is the fact that you can't invest in tax sheltered accounts like
iras roth iras and this is a big problem for me
because i always want to take care of those types of investments first
before i use an individual account like what you use on robinhood
so as far as iras and roth iras tax sheltered accounts
do not exist right now on the robinhood platform
maybe one day they'll offer tax sheltered accounts and in my opinion
that'll be a very good thing but for right now they don't offer them
but as far as cons go that's really all that i have to complain about robinhood
and as far as pros go there are a lot of very good benefits for them
and so overall i feel like they're a very good brokerage account to invest
with minus just a few little quirks that they
have but honestly any brokerage account that you're going to work with they're
always going to have pros and cons same with robinhood now if you guys are
interested in watching more videos specifically on robinhood
like how to buy or sell stocks or how their drip program works
then i've left a playlist over here that you guys can check out so you can watch
more of them but i really do appreciate you watching
this specific video thank you very much have a great day