Two of the most preferred trading choices of Americans, here is the elaborated breakdown of Webull and Robinhood.
Investing is one of the great ways to grow your wealth over a longer period of time. There are investors who chose to adopt a passive approach and invest in index funds or allow a robo-advisor to handle their investments on their behalf. Yet others chose to be more actively involved and pick on investments that they believe could outperform the market.
Whatever the approach, time is of the essence in investing in securities and therefore the go investing is picking up. However, for that to happen one has to choose an appropriate investing platform and the chances are that one would have come across two of the more popular options in this space- Webull vs Robinhood. While both the platforms offer investors the opportunity to invest actively or passively, depending on the goals of the investors, it could be a tough choice when selecting which one of the two to go with.
Here is all you need to know about the similarities and differences between the two services, what they offer and charge and which app suits you best.
Webull vs Robinhood- Comparisons to help you make sound choice
- Supported securities
The securities that both Webull and Robinhood offer include trading in stocks, ETFs, futures options and cryptocurrency trading. Webull additionally offers ADRs while Robinhood additionally American Depositary Receipts for over 250 global companies and Fractional shares.
Webull offers crypto trading in 10 digital coins while Robinhood offers in 7.
- Annual Fee
While Webull officially has no annual or inactivity fees, it charges $75 for a full or partial transfer fee. Robinhood also does not have any annual, inactivity or ACH transfer fees but charges $75 ACAT as an outgoing transfer fee. It is worth mentioning that Robinhood Gold costs $5 a month to users.
Webull doesn’t charge any commission fees but it does charge a commission at the rate of 7 per cent for margins up to $25,000. After that, the fee lowers to half of a per cent in increments to $3 million.
Robinhood too does not have any commission or fees for trading stocks. However, individuals have to upgrade to the gold account option to trade stocks on margin and pay a $5 fee each month. The company also charges a 5 per cent annual fee for margins greater than $1,000, which is lower than that of Webull.
- Account minimum
Both Webull and Robinhood have zero account minimum for brokerage accounts and requires a minimum balance of $2,000 for a margin account. Robinhood has a $5 fee per month for margin accounts for Robinhood Gold subscriptions.
- Customer Service
One is able to contact Webull through its message centre through the trading platforms as well as over emails and via telephone. The company also has a ‘Feedback’ section on the Webull trading platform for user reviews and experiences. It is worth noting that the customer service facility of the company is available even on the weekends. One can also get in touch with Webull customer service representatives 24/7 for assistance through its multiple trading platforms and to answer any queries and questions investors may have.
In comparison, Robinhood customer service only offers support through email and social media platforms. There is no option for users seeking support over the telephone or through live chat options.
IRA is the abbreviation of Individual Retirement Account which is a tax-advantaged investment account meant to allow individuals to save for retirement.
Webull supports individual retirement accounts(IRAs) – Roth, Traditional, and Rollover IRAs. Every individual Webull user can create and open a single IRA account. Webull traders need to have an individual account in order to create an individual retirement account.
Robinhood currently does not offer any form of IRAs.
- Target users
Both Webull and Robinhood are popular online stock trading platforms that allow users to invest and make trades largely commission-free.
Webull has positioned itself in the market both for usage on the desktop as well as for app-based users. The underlying positioning of the company is targeted more toward the more sophisticated investors.
On the other hand, Robinhood has positioned itself to target more of the “gamification” market with its focus on its app and its ease of use for new investors. But the targeting of Robinhood of the inexperienced investors contrasts with its emphasis on options trading which is a highly sophisticated area of the market.
Webull vs Robinhood- Should I switch from?
It can be said that Webull is a very helpful tool for most investors, but specifically useful for those who either have or seek to acquire a degree of sophistication in trading and investments. The usability of the app and the desktop version of the app has a wide range of tools to assist in making investment decisions which can be intimidating for newcomers. However, even newcomers can take advantage using the basic pricing information that is clearly laid while pro-investors can use its impressive range of technical data to make investment decisions.
On the other hand, Robinhood is specifically designed for novice investors. The interface is clean, easy and quick to use. The data and information offered to users are simple and easy and is not overwhelming for an inexperienced trader. Even complicated assets such as options contracts are relatively easy to understand for a beginner but could be too little for a serious and experienced investor. But this strength of the platform can also become its weakness. Robinhood’s platform is as much targeted at new and inexperienced investors as it is designed for them. New trades are suggested in very much the same way as an online retailer would recommend new products based on past behaviours, which can create possible issues for new investors potentially unaware of the full risks of investing in individual equities. Few guardrails are offered for high-risk assets such as options contracts and in some ways leave new investors to find their way into those assets. Hence it is likely that new users would find it easy to navigate through the platform but have to be careful about the limits of suggestive information available. On the other hand, those experienced investors who have other sources of getting complete risk and return information could benefit more from the ease of use of Robinhood’s platform.
Therefore, new inexperienced users should shift from Robinhood to Webull despite the higher charges for some securities that it offers, simply because it makes investment safer. And if you’re a pro-investor, Robinhood can be a pocket-sized platform for making fast investments on the go.
Robinhood and Webull run a photo finish in so many categories that it can be a tough call to select a clear winner.
With respect to standard brokerage fees, there is little difference between Webull and Robinhood. The main difference between the two is in account type availability, account features, margin rates, and investment research.
One should consider going for Webull if one is an active or advanced trader, one who needs to always be aware of market fluctuations throughout the day. In addition to the low-cost products, Webull also offers extended hours trading, free real-time quotes, Nasdaq market data, and 24/7 customer support.
Both Robinhood and Webull have a $2,000 margin account minimum. However, the annual margin rate of 2.5 per cent of Robinhood is fairly lower than that of Webull’s. That means an investor ends up paying less to borrow at Robinhood. Another notable element for Robinhood is that while its Robinhood Gold membership costs $5 per month, it allows for instant account deposits of up to $50,000.
And then there are two issues that further draw the difference– Robinhood provides cash management accounts, while Webull doesn’t; Webull offers IRAs, but Robinhood doesn’t.
Hence, if one is seeking a low-cost combination of investment accounts and cash management options, one could go for Robinhood. However, if retirement investing is more important, Webull may be the better choice.