Trade stocks and ETFs free of charge
Investors line up around the virtual block to buy and sell stocks on a new mobile brokerage app that offers commission-free trading. The application, called Robin Hood, has a waiting list of over half a million people, 80% of whom are between the ages of 18 and 29. It is not a coincidence. The creators of the app want to attract millennials by making stock trading intuitive, accessible and cheap.
You don’t have to be young to see the call. There is no minimum balance requirement or commission to trade US-listed securities. At this time, you can only trade stocks and exchange-traded funds, no mutual funds, options, or short selling. When rolled out, paper statements and broker-assisted phone transactions will cost more.
Skeptics say commission-free transactions have been tried before, and wonder if Robinhood will generate enough revenue from other sources (the interest it earns on customer account cash, for example) to be successful. Others say the zero-commission trend has legs and that Robinhood is ahead of the game. Users are being introduced gradually. Join the waitlist at www.robinhood.com or by downloading the app for your Apple device. Expect an Android release later this year.