6 Robinhood Alternatives

Robinhood Markets Inc (NASDAQ:HOOD) is one of the most popular apps for retail traders. It gained notoriety at first for offering commission-free trading, and thereafter for selling customer order flows.

But it remains popular with a sleek user interface and “game-ified” platform that serves 18 million users (most of whom are active monthly). 

Some users are concerned that free is not truly free – “if you’re not paying for a product, you are the product.” 

Building a diversified portfolio is about more than just choosing diverse investments – you should also diversify your brokers in the event that a single platform goes down, as Robinhood has in the past.

Here are six alternatives to Robinhood that allow you to take control over your investment portfolio.

1. TD Ameritrade

TD Ameritrade is a broker founded in 1975 and acquired by Charles Schwab Corporation (NYSE:SCHW) in 2020.

It has over 11 million clients with more than $1 trillion in assets under management. Like Fidelity, the company is known for providing better deals and more robust services than its smaller, newer rivals.

As a a full-service broker, it’s straightforward to reach a licensed investment professional. We may live in an app-based society, but customer service from subject matter experts is still the gold standard.

The breadth of financial services and information available at this legacy broker is unmatched. For newbies, it can be a bit overwhelming. However, the ability to trade bonds and mutual funds, along with the stellar customer service, is enough to entice traders leaving Robinhood.

2. M1 Finance

M1 Finance is a robo-advisor platform founded in 2015 by Brian Barnes. The platform has a different audience, focusing on long-term investing over the day trading common on both Robinhood. Clients are encouraged to build investment pies and deposits are automatically funneled into long-term holds. This encourages a more conservative investing style.

By July 2021, the company received $150 million in series E financing that valued it at $1.45 billion, a fraction of the $4.5 billion in assets under its management from over 500,000 users.

Automated tools help to set rule-based finance transfers on the platform, which provides the benefits of an active portfolio manager. With so much automated, you can live your life and trust the platform to manage your investments.

The C-suite’s roadmap is focused on innovating beyond investing into savings, lending, and more. It aims to be a one-stop shop that replaces traditional financial services, banks, or even fintech companies like Paypal Holdings (NASDAQ:PYPL). 

3. Public

Public takes yet another route by combining social media and investments, letting users broadcast their trades and follow influencers. This capitalizes on the democratization of investing by giving users the option to organize and make trades on one platform, whose investors include influencers like Will Smith, Tony Hawk, J.J. Watt, Casey Neistat.

The company launched in 2019 and already has over one million users, making it one of the largest Robinhood rivals. It aims to demystify investing by letting users track each other’s trades and learn from popular investors. 

The company also offers a variety of trading themes to make it easier for new investors to choose. Of course, it’s not the only company working to do that.

4. SoFi

SoFi Technologies Inc (NASDAQ:SOFI) was founded in 2011 by a group of Stanford students seeking an affordable solution to student debt.

By 2013, it was offering peer-to-peer student lending as a first product, before broadly expanding its financial offerings over the next five years. 

By 2020, the company offered mortgages, personal loans, and refinancing, along with cash management, credit, and investing accounts. While not as flashy as the competition, its social finance offerings led to nearly 2 million registered members by year end.

In June 2021, the company went public through a SPAC merger. It’s estimated to earn $1 billion in net revenue in 2021, and it has the backing of Chamath Palihapitiya, a prominent investor in the social media age.

Should SoFi successfully remove its reliance on legacy banks through a bank charter, the company is poised for growth. It is relying on the halo effect of cross-selling existing customers to new offerings, and it’s currently executing flawlessly.

5. Fidelity

Fidelity Investments is a legacy financial services company based in Boston, Massachusetts. It was founded in 1946 and grew to become one of the largest asset managers in the world, with about $5 trillion in assets under management serving over 26 million retail accounts and 32.6 million workplace retirement accounts.

The company offers a variety of investment tools, including mutual funds, index funds, retirement accounts, and wealth management. And it continues diving further into cryptocurrency, with its Fidelity Digital Assets app and a Bitcoin ETF.

Because it’s a more traditional brokerage, Fidelity has lagged in features like fractional shares and DRIP reinvestments. However, it does allow investments in mutual funds and penny stocks not available at many of its smaller rivals.

Fidelity offers its users a deep arsenal of research and data tools. That’s how it consistently outranks Robinhood and others in critical reviews and rankings.

6. Webull

Webull Financial LLC is a Chinese-owned electronic trading platform that has backing from companies like Xiaomi and Shunwei Capital.

Originally founded by former Alibaba Group (NYSE:BABA) employee Wang Anquan in 2017, the company quickly grew and received SEC approval as a robo-advisor.

The platform’s biggest growth surge came at the beginning of 2021, during the GameStop Corp (NYSE:GME) short squeeze. Robinhood CEO Vlad Tenev (who became a multi-billionaire during the company’s IPO) halted trading on affected stocks to maintain liquidity. 

This caused a revolt of its users, and Webull’s new account openings skyrocketed from the 2 million users it had at the end of 2020. 

While somewhat similar in capabilities, Webull’s UX and tools are different from Robinhood. It allows trading of more cryptocurrencies, and the company recently opened fractional share trading. It doesn’t allow trading OTC penny stocks or mutual funds, however. 

#1 Stock For The Next 7 Days

When Financhill publishes its #1 stock, listen up. After all, the #1 stock is the cream of the crop, even when markets crash.

Financhill just revealed its top stock for investors right now... so there's no better time to claim your slice of the pie.

See The #1 Stock Now >>

The author has no position in any of the stocks mentioned. Financhill has a disclosure policy. This post may contain affiliate links or links from our sponsors.