How to get free stock trades….really free!
When trading with smaller amounts of money usually getting a good return is limited by the cost to enter and exit the position. Even with some of the discount brokers on the market the costs of purchasing and selling a position can range from $10-$20. This may not be a lot when making 5 figure trades, but this adds up when you’re dealing with smaller purchases.
On a $500 trade, $6 trades in and out equal almost 2.5% of the trade value. When you’re making smaller margins this can take a big bite out of your profits. Now I am not an active day trader but I do like to dabble in small moves in the market and stay ahead of trends which is why I’m loving this new platform I am about to recommend.
Robinhood is a fairly new trading platform which only operates in mobile app form. It offers FREE trades! Yes, you read that right FREE. I have been using this app for about 8 months now and am ready to give it the thumbs up.
Some drawbacks, however, are that it is only in app form and cannot be accessed via a computer online. This is not all bad but it is a little limiting, however since everyone has a phone or tablet in arms reach these days it really doesn’t matter. Secondly, you cannot do complex trades such as options but if you’re that intense of a trader this app wouldn’t be for you anyway.
This app is linked to my checking account and transferring funds is really easy with the touch of a button. Once the transfer is made funds are ready to trade, they have a premium version called Robinhood Gold but as of this article, I have not bothered to sign up for it. My understanding is that you can trade larger sums, have access to your transfer faster and longer trading hours. Please see the app for more details if you are interested in these features.
I have only invested a couple thousand dollars into the account to test the platform, so far all of my trades have been processed in a timely manner, and the app does track day trading activity and limits you to 3 trades per day.
From what I have gathered the company makes is money from the accrued interest on members’ funds that sit idle in their accounts. As long as they keep their overhead low and enough subscribers with idle cash I can see how this would work.
In conclusion, if you are a serious trader who does complex trades or has large sums of money that need lightning fast executions then this app probably isn’t for you. However, if you are like me and use this app as an extra account and like to play with small amount of funds and ride small movements in the market this app is awesome since it allows for you to make more money with less capital. I will post a link to the app below so you can check it out for yourself and as always we will continue to track down the best financial resources for you, our reader!