Robinhood Vs. Other Brokers: What To Consider When Choosing Or Switching Trading Platforms

Choosing the right broker is an important part of investing because you need to be able to make trades, right? Well, every year IBD polls investors about what they like about their broker across a variety of metrics in their Best Online Brokers survey. Robinhood is known as the virtual trading platform of choice for young investors, but what else should traders consider when choosing a broker for the first time or switching to a new broker?

Price is the number one consideration for Generation Z and Millennial traders, says IBD Markets Correspondent Rachel Fox, who analyzed survey results regarding young investors.

“I think one of the most important things (from the IBD survey) is the price — being very careful about the price,” Fox said. “They want to start on a small scale and do it on their own terms.”

Robinhood has a significant foothold in the youth market because of the way they have branded themselves, according to Fox.

They were the first to break into everyone [strategy of] There are no commissions, as you know, there is no minimum account. “People really think they’re that way,” Fox said.

Fox also noted that the Robinhood app is very simple and easy to use: “Everything is laid out very clearly. It feels very relaxing, I think, for beginners.”

While Robinhood can take a good deal of credit for making an investment available to “a group of people who never touched it,” according to Fox, the trading platform did not receive the highest scores in the IBD’s Best Online Brokers survey for trading culling.

Robinhood vs. Other brokers: What are your goals?

When choosing a broker, it is all about deciding what type of trader you want. Fox says young investors are very interested in getting business ideas and accessing research tools.

For those who want to go beyond the basic charts, Robinhood may not be the answer. Fidelity, TDAmeritrade, and Charles Schwab have the highest scores in the IBD survey for research tools. For trading ideas, Ally Invest, E-Trade, and Robinhood got the highest scores.

“Consider what your priorities are and what you envision the investment path would look like,” Fox said, whether that’s starting a retirement account or casually trading M stock. “Find out what you are here for because there are so many different ways you can be an investor.”

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