Website design By BotEap.comAbout two weeks ago I downloaded a fairly new trading app called Robinhood and thought I’d share my initial review with you guys today.

Website design By BotEap.comI have wanted to trade stocks for a long time, but the fees that come with trading or going to a broker always stood in my way. If you’re like me and don’t have a lot of money to trade, these fees can eat into your profits. Robinhood lured me into signing up due to the fact that the app is free, but also because a promotion allowed me to get free shares upon signing up.

Website design By BotEap.comIs it worth downloading Robinhood?

Website design By BotEap.comIt’s been a long time since I’ve been excited to make any kind of money online. The internet has become too saturated in almost every market and many companies are looking to trick you so they can make a quick profit while you make nothing. Robinhood is not that company.

Website design By BotEap.comWhen you sign up for the app, you attach Robinhood directly to your bank account. I ended up getting a free stock on Fit Bit and eventually ended up selling that stock. Robinhood notes that there is a 1 in 1,000 chance that you will pick a big-name stock like Apple. From the first stock I got along with 4 that I now got from referrals, the best stock I received was valued at $10. Nothing big, but free money is free money. You must hold the shares for 3 trading days before you can trade or sell your shares.

Website design By BotEap.comHow does Robinhood make money?

Website design By BotEap.comJust like a bank, Robinhood makes money (and can give you free shares) by charging interest on the money you deposit into your account. As long as your customer acquisition costs are below your interest earnings, Robinhood will be a profitable business. Seeing that some users have over $100,000 in their account, you can easily see why Robinhood can offer free trades.

Website design By BotEap.comThat doesn’t mean it’s perfect.

Website design By BotEap.comDay trading is something you cannot do unless you have more than $25,000 in your account. I think you can get up to 3 or 4 days trades in a 5 trading day period, or you could be labeled as a pattern trader. That said, Robinhood can be used for swing trading and long-term investments.

Website design By BotEap.comWhat about the interface?

Website design By BotEap.comRobinhood’s interface is very basic and basic. Although I haven’t had a chance to dive into the Gold Membership, here’s what I’ll say:

Website design By BotEap.comI do NOT recommend using Robinhood to decide when to buy and sell a stock. Instead, it complements the Robinhood app using market clock Y Bar graphic to get the information you need before you trade.

Website design By BotEap.comBuying a stock with Robinhood is very easy.

Website design By BotEap.comWith the basic membership (which is free), you get up to $1,000 of Robinhood money that you can use, while you wait for your money to be transferred from your bank account to buy a share. In short, you get the shares immediately (with money from Robinhood) until the money is transferred from your bank account. This is great as getting in at the right price points is critical; Especially with swing trading.

Website design By BotEap.comOptions trading is also another possibility within Robinhood.

Website design By BotEap.comYou will have the ability to configure contracts. That said, I’m relatively new to the stock market, so all I’ve really dabbled with is buying and selling stocks.

Website design By BotEap.comHow much money can you earn with Robinhood?

Website design By BotEap.comThe other question could really be, how much money can you lose? If you’re playing the stock market and you don’t know what you’re doing, there’s a good chance you’ll end up losing (and not winning any money) with this app.

Website design By BotEap.comI am not a financial advisor, so I cannot offer financial advice. What I can say is that I would definitely recommend reading books on how to trade stocks successfully and then practicing on a simulation app. before using real money.

Website design By BotEap.comGeneral rating:

Website design By BotEap.comAside from the fact that you cannot day trade at Robinhood, unless you have more than $25,000 in your account. If you’re looking to buy and sell stocks for the first time without any trading fees, this app is probably worth a try.

Website design By BotEap.comI give Robinhood a rating of 4 out of 5. The app is very basic and makes it easy to buy and sell stocks. Unfortunately, the app is also so basic that you’ll want to use Market Watch and Barchart before making any purchase decisions.

Website design By BotEap.comYou could make a lot of money with this app, but you could also lose a lot of money.

Website design By BotEap.comAt the end of the day, Robinhood can be a great way to make money, but if you’re not sure what you’re doing, you could also lose money. Would I replace my Roth to fund this app? Of course not. But I would use Robinhood to supplement my income through smart investing and referring family and friends to the app for more free shares.