Robinhood is really popular and there are some good reasons why. But I think veteran traders should give an honest review of the platform so that newer traders understand what Robinhood really offers… and what it doesn’t. So here’s my Robinhood review based on my experience.
What is Robinhood?
Robinhood is a trading platform targeted toward small accounts. It offers commission-free trading on the basics, and they have successfully marketed themselves to newer traders.
I’ve been trading long enough to remember my first “e-trade” account. Robinhood to me is an onboarding platform, a step in the right direction, but definitely not where you want to “end up”. It’s snazzy, it’s clean, and it’s efficient. However, for those who are REALLY making the commitment to the trading world, you’ll soon pick up that you’re limited in so many ways.
Pros and Cons of Trading with Robinhood
What are the pros and cons of Robinhood? I guess I’ll be negative and start with the cons.
The first con is the education that Robinhood provides users. I look for a trading platform that gives me access to education on the things that really matter. This can come in the form of looking at open interest on the option chain, implied volatility expansions, scans, charts, volume indicators, and the damn list goes on and on and on for eternity, truly. You’re missing out on so much vital trading information and THAT’S where I actually get worried about new traders experiencing Robinhood.
It’s not that they control and share your data, it’s not that they won’t let you open up a new fresh batch of “AMC diamond-super-ape” LONG CALLS funded by your “Federal Tendy” check. It’s that you truly don’t have the fundamental capabilities to see the larger picture. For that reason I start with a 2.5 stars out of 5, and I’m being a saint right now.
My second comment, both a pro and a con, is that Robinhood is so sleek. Y’all this is the elevator to the VIP lounge for beginner traders! This platform is so sexy it’ll make you think you’re a trader the moment you fund it. I think it’s NAIVE. I really don’t think it’s helpful in the long run even if it does grant easy access to new traders.
Despite my opinion, this’ll probably be a thing for a while, meaning I think Robinhood has proven it’s here to stay.
On a more positive note from a veteran, Robinhood allows easy and quick access which is clearly a plus especially in today’s fast-paced environment. I was on the waitlist to open up a Robinhood account so I’ve been here from the beginning. The reason I funded my account a long time ago was because I thought I’d dabble with a few thousand dollars trading crypto contracts (keyword contracts because when purchasing crypto on Robinhood you actually don’t have ownership, you own the contracts that represent it).
For some, that’s an actual plus, for some it’s a total turn-off.
On another positive note, Robinhood does a great job of “explaining via example” stemming from the operations behind the app itself. It’s freaking easy to use y’all. You know exactly what is at risk and the app design is efficient and straightforward enough to actually educate. That’ll be another reason why Robinhood will be around for a while, they’re always hitting two-birds with one stone.
Also, like I said before, it’s smooth – the workflow is easily manageable and they made it so you really do understand your options contracts and the possibilities around your position once the trade goes live. I really don’t consider myself biased just because I have a Robinhood account, I’m being really fair here. I feel like I could go back and forth with negatives and positives about the app, but overall I can appreciate its general utility for new and just generally interested traders.
Robinhood has also evolved, A LOT. There’s always new data reels from some of the top contributors readily available to look over. I also really do like the analytics available throughout the app when trying to access numerical data in relation to the market.
Robinhood as a Trading Platform Disruptor
Here’s the deal, I could go through every nook and cranny of Robinhood and point out every negative and positive. From a holistic approach, the bigger picture is simple – and this is my most important takeaway. Robinhood is a much long-needed options trading platform disruptor. If we didn’t have Robinhood we wouldn’t have such a dynamic economic climate, and man I love that the financial sector is the last and biggest turning point in our lifetime.
Here’s why I think it’s a positive. Shocker… it’s created a more liquid market and it’s educating a generation of future investors; it’s providing something super valuable that school won’t teach you. How to calculate risk, not just financially, but in life.
To me even with all the bad, Robinhood has been fantastic and as traders we love volume and volatility expansion. That might come off selfish, it’s really not. This has been a great addition to the world of trading and I’ll always be fair even if they’re sharing your data and not letting you open a new GME call :).
Looking to explore some of the things you can’t get from Robinhood trading? Check out my micro futures class! See you there!