New App Lets You Buy, Sell Stocks With No Fees
For Robinhood, the price is right but the wait is long.
Investors are lining up around the virtual block to buy and sell stocks on a new mobile brokerage app that offers commission-free trades. The app, called Robinhood, has a waiting list of more than half a million people, 80% of them between 18 and 29 years old. That’s no accident. The app’s creators want to attract millennials by making stock trading intuitive, accessible and cheap.
You don’t have to be young to see the appeal. There’s no minimum balance required and no commission to trade U.S.-listed securities. For now, you can trade only stocks and exchange-traded funds—no mutual funds, options or short-selling. When they’re rolled out, paper statements and broker-assisted phone trades will cost extra.
Skeptics say that zero-commission trades have been tried before, and question whether Robinhood will generate enough revenue from other sources (the interest it earns on cash in customer accounts, for example) to succeed. Others say the trend toward zero commissions has legs, and that Robinhood is ahead of the game. Users are being phased in gradually. Get on the waiting list at www.robinhood.com or by downloading the app for your Apple device. Expect an Android version later this year.