Free Stock Trading App Like Robinhood: Everything You Need to Know
Robinhood is a popular free stock trading app that has revolutionized the way people invest in the stock market. With Robinhood, you can trade stocks, ETFs, options, and even cryptocurrencies without paying any commissions. However, Robinhood is not the only app that offers free stock trading. In this article, we will explore some of the best free stock trading apps like Robinhood.
What is Robinhood?
Robinhood is a commission-free stock trading app that was launched in 2013. The app allows users to buy and sell stocks, ETFs, options, and cryptocurrencies without paying any fees or commissions. Robinhood has become very popular among young investors who are looking for a simple and easy way to invest in the stock market.
Top Free Stock Trading Apps Like Robinhood
There are several other free stock trading apps like Robinhood that you can use to invest in the stock market. Here are some of the best options:
1. Webull
Webull is a commission-free stock trading app that offers a range of features including real-time market data, advanced charts, and technical indicators. The app also allows you to trade stocks, ETFs, and options without paying any commissions. Webull is a great alternative to Robinhood for investors who are looking for more advanced features.
2. TD Ameritrade
TD Ameritrade is a popular online brokerage that offers commission-free trading for stocks, ETFs, and options. The app also offers a range of educational resources and tools to help investors make informed decisions. TD Ameritrade is a good choice for investors who are looking for a more traditional brokerage experience.
3. E*TRADE
E*TRADE is another popular online brokerage that offers commission-free trading for stocks, ETFs, and options. The app also offers a range of tools and resources to help investors make informed decisions. E*TRADE is a good choice for investors who are looking for a more robust trading platform.
4. M1 Finance
M1 Finance is a free investing app that allows you to invest in stocks and ETFs without paying any fees or commissions. The app also offers a range of features including automated investing and portfolio management. M1 Finance is a great choice for investors who are looking for a simple and easy way to invest in the stock market.
How Do Free Stock Trading Apps Make Money?
You might be wondering how free stock trading apps like Robinhood are able to make money if they don't charge any fees or commissions. The truth is that these apps make money in several ways:
1. Interest on Cash Balances
When you deposit money into your account on a free stock trading app, the app will typically hold that money in a cash account. The app can then invest that money in low-risk investments like government bonds and earn interest on those investments.
2. Premium Features
Some free stock trading apps like Webull offer premium features that you can pay for. These features might include access to more advanced charts or real-time market data. By offering these premium features, the app can generate revenue without charging any commissions on trades.
3. Securities Lending
Free stock trading apps can also generate revenue by lending out securities to other investors. When you buy a stock on an app like Robinhood, you actually own a share of that stock. The app can lend out that share to another investor who wants to short the stock. The investor who borrows the share will pay a fee to the app, and the app will split that fee with you.
Conclusion
Free stock trading apps like Robinhood have made it easy and affordable for anyone to invest in the stock market. While Robinhood is a great app, there are several other free stock trading apps like Webull, TD Ameritrade, E*TRADE, and M1 Finance that you can use to invest in the stock market without paying any fees or commissions. These apps make money in several ways including interest on cash balances, premium features, and securities lending.
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