Webull vs. Robinhood: A Comparative Guide for Investors (2024)

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Webull vs. Robinhood: At a Glance

Webull and Robinhood are two of the best online brokers for free stock trading, helping the next generation of investors reach their financial goals and mitigate portfolio risk through diversification, low-cost trading, and smart investing strategies.

Compared to the hassle and costs of investing through a traditional brokerage firm, user-friendly trading platforms like Robinhood and Webull make investing more inclusive. You can open a brokerage account with either platform regardless of your financial background or investment experience.

Webull Brokerage and Robinhood Investing are fairly well-matched when it comes to fees, account options, and investment opportunities. But while the Webull and Robinhood platform features are similar, but there are some notable differences.

Here's Business Insider's comparison of Webull and Robinhood's commission-free trading.

Platform Overview and User Experience

Webull's Platform

Webull is a discount investment app and desktop trading platform offering self-directed and automated trading options suitable for passive and active investors. It's great for beginners and options traders, but experienced investors might also appreciate Webull's robust trading features like extended market hours, in-depth quotes, and comprehensive analysis tools.

Webull currently has a limited-time 3.5% IRA match on all contributions until August 15, 2024.

Webull's robo-advisor uses quantitative analysis and insights to make smart investment decisions. By inserting data like your time horizon, risk tolerance, and goals, you'll receive a customized portfolio. It also offers a range of account tools like auto-rebalancing and a performance tracker.

Webull has received an F rating from the Better Business Bureau, the lowest possible score. According to the BBB website, Webull has an F for multiple reasons, including government actions against the brokerage and Webull's failure to respond to customer complaints.

Webull investing review

Robinhood's Platform

If you've ever discussed trading apps, Robinhood was probably mentioned once or twice. It's one of the market's most popular mobile investment platforms. Robinhood is best for hands-on investors, margin traders, and newbie crypto investors.

It's also offering one of the best IRA accounts, partially for its unique match benefit on all IRA contributions, including transfers and rollovers. Earn up to a 3% boost on retirement savings with Robinhood.

Robinhood is not recommended for beginners as it gamifies investing. Gamifying investing can be dangerous for inexperienced investors unfamiliar with the risks of trading volatile assets like individual stocks and digital currencies.

Robinhood Investing has a D+ rating from the Better Business Bureau due to a pattern of complaints that users were unable to withdraw funds from their investing accounts. The brokerage account also took a hit because of the government actions taken against the business.

Investment Options and Features

Webull's Investment Options

Webull's investment choices include stocks, ETFs, options, index options, OTCs, futures, ADRs (shares in foreign companies), and fractional shares. Webull no longer offers cryptocurrencies.

You can invest in the following accounts:

• Individual brokerage accounts
• Retirement accounts (traditional IRAs and Roth IRAs)
• Webull cash management accounts
• Margin accounts
• Automated accounts

On the retirement side, Webull has traditional, Roth, and rollover IRAs. Webull's IRAs only allow you to invest in stocks and ETFs.

Robinhood's Investment Options

Robinhood offers stocks, ETFs, options, ADRs, IPOs, and cryptocurrencies.

Its account selection includes:

• Individual brokerage accounts
• Cash management accounts
• Retirement accounts (traditional IRAs and Roth IRAs)
• Margin accounts

On the crypto side, Robinhood lets you trade 15 digital assets, including bitcoin, ether, dogecoin, and more.

Fees and Costs

Webull's Fees and Costs

You can open a Webull self-directed brokerage account with no account minimum and commission-free trading for stocks, ETFs, and US-listed options. Certain option trades charge a $0.55 per contact fee. Fractional share investing starts at $5, and fees for futures range from $0.25 to $1.25 per contract.

A Webull Smart Advisor account requires a $100 minimum. You'll need at least $2,000 in your account to trade on margin. Margin rates range from 5.74% to 9.74%, depending on your account balance.

Webull also works with regulatory agencies and clearing firms that apply small fee deductions of up to $7.27 per transaction.

Robinhood's Fees and Costs

There's no minimum requirement to open a regular Robinhood brokerage account and trade commission-free stocks, ETFs, and cryptocurrencies. Robinhood Gold charges a $5 monthly fee. You'll need at least $1 to trade fractional shares.

To access margin trading, you must be a Gold member and have at least $2,000 in your account. Robinhood margin rates of 12% for non-gold members and 8% for Gold members.

Educational Resources and Support

Webull's Resources

Webull gets you access to Nasdaq-sponsored market data, free real-time investment quotes, 24/7 customer support, portfolio rebalancing (on automated accounts), paper trading, and recurring investment options. Webull also offers an informational blog with educational resources and market news.

Robinhood's Resources

Robinhood offers a virtual library that contains various financial education articles on investing, options trading, and other topics. You won't be able to access additional research and market insights unless you're a Robinhood Gold member. Additional resources for Gold members include access to Morningstar professional research and market data from Nasdaq.

Non-gold members can access IPOs, recurring automatic payments (select daily, weekly, bi-weekly, or monthly options), 24/7 customer support, and guidance on first trades. Robinhood now offers crypto wallet access.

Security and Regulation

Webull's Security and Regulation

Webull is regulated by the SEC and FINRA and offers users up to $500,000 in SIPC insurance with a $250,000 limit for cash. Moreover, customer transactions are insured by Apex up to $37.5 million for investments and $900,000 for cash.

Financial transactions between Webull and your bank account go through Plaid, which encrypts your bank account numbers and adds multifactor authentication. The platform is also equipped with two-factor authentication and security questions.

Robinhood's Security and Regulation

Robinhood is regulated by the SEC, offering financial protection of up to $1.9 million for cash and $50 million for securities per customer. FINRA does not regulate it. You also get SIPC account protection up to $500,000 with a $250,000 limit for cash. The FDIC insures Robinhood users who opted in for the Brokerage cash sweep program up to $2.25 million.

Robinhood secures personal information and investment accounts with software encryption, two-factor authentication, and passwords hashed with BCrypt hashing algorithm.

Choosing Between Webull and Robinhood

When it comes to standard brokerage fees, Webull and Robinhood are very similar. The two mainly differ in account types, account features, margin rates, and investment research.

You should consider Webull if you're a passive or hands-off trader who likes the convenience of automated investing. Along with its low-cost products, Webull offers extended hours of trading, free real-time quotes, Nasdaq market data, and 24/7 customer support.

Robinhood is best for active investors wanting access to the platform's beta NFT platform and web3 wallet. Moreover, crypto investors are better off with Robinhood as Webull no longer offers cryptocurrencies. Robinhood offers 15 different coins and tokens.

While Robinhood Investing and Webull share the $2,000 margin account minimum, Webull has the lowest potential margin rate at 5.74%. Still, only accounts of more than $3 million can reach this rate. So, depending on how much you plan to be in your account, you may find Robinhood better.

Webull vs Robinhood — Frequently Asked Questions (FAQs)