Robinhood vs Stash: Broker Comparison
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Robinhood, the pioneer for mobile trading apps in 2017, now faces stiff competition from a handful of new, user-friendly mobile trading apps.
Incredibly, there has been a 50 percent increase in the amount of trading done on mobile apps since 2017, and Stash has appeared to meet the demand of investors and traders who want more access to markets without getting too deep into methodologies and market strategies.
Both apps are quite intuitive, but Stash offers some more benefits for retirement accounts.
While Stash aims to make the process of researching and selecting investments easier, it limits investors to 60 ETFs and just 100 stocks.
These are hand-selected for their performance, but experienced investors may want more. Stash has also been making headlines with “Stock-Back Rewards”, which offers customers more value.
Investor Warning: All securities trading, whether in stocks, exchange-traded funds (“ETFs”), options, or other investment vehicles, is speculative in nature and involves substantial risk of loss. Robinhood Financial encourages its Customers to invest carefully and to use the information available at the websites of the SEC at http://www.sec.gov and FINRA at http://FINRA.org.
Robinhood vs. Stash – Quick Comparison
Here are some quick highlights and results from our review:
- Robinhood is a free mobile trading app that also lets you trade stocks, options, and ETFs for $0 in fees
- Includes access to customizable alerts and watchlists, as well as basic candlestick charts
- Access cryptocurrency trading if you live in certain states
- No guidance or research tools
- Only has email support for customer service
- Not the best for retirement accounts, since there are no mutual funds
- Stash is an innovative mobile invest app that offers more guidance on picking investments
- Must invest at least $5 and pay $1/month for a basic account
- Investors can only select from 60 ETFs and 100 stocks
- Stash groups stocks and ETFs by the theme to make it easier for novice investors
- Better customer support options including phone support from Monday to Sunday
Fees and Commissions
Robinhood has always been the free stock trading app. You can trade stocks, ETFs, and options for $0. There is no per leg or per contract cost for options, which made it one of the best low-cost trading options for investors until 2019 when most brokerages followed suit and reduced their commissions to zero.
Now, Robinhood has a pretty similar fee structure to almost every other discount brokerage. The only difference is you won’t pay addition per options contract, and you can order complex four-leg options as well.
The only fee that Robinhood charges is a $5 subscription fee if you want access to margin orders with the Robinhood Gold plan. Otherwise, everything is free.
Stash has a totally different approach to investing that must be explained since it’s essential to understand their fee structure. Stash is not designed for a traditional investor. Also known as Stash Invest, this mobile trading app is for iOS and Android.
You can start investing with as little as $5. In return, you will be able to buy fractions of shares that are grouped in hand-selected exchange-traded funds or ETFs.
Basically, you buy a share of an ETF, which is connected to a larger fund that holds more expensive stocks. For example, you may want to join the ETF Vanguard S&P 500, which buys shares from all 500 companies found on the S&P 500 list. Stash will let you buy a fraction of a share, which means that you bought a small portion of a more expensive ETF.
Investors who like to play complex orders or work with options won’t like Stash, and that’s okay. This app was designed for people who do not really know a lot about investing, and they place their trust completely in Stash’s brokers.
There are also account subscription fees with Stash as follows:
- $5 account minimum balance
- $1/month for their most basic plan
- $3/month to add retirement account
- $9/month to add retirement and custodial accounts, as well as other broker services
Winner: It’s hard to say who wins this one, but the most low-cost option would be Robinhood. You can invest without paying anything, and there are no minimum account balances. Stash’s simplistic view towards investing may not be for everyone.
Both of these brokerages focus on a limited number of investments that are most popular with younger investors. Robinhood typically does not offer the same breadth of investments as other brokerages, but in this case, you can invest in more asset classes than with Stash.
Robinhood offers you the ability to invest in the following:
- Complex options
- Cryptocurrency (in some states)
While there are no mutual funds or futures, Robinhood keeps it simple and doesn’t charge any fees either. They have also recently launched Robinhood Crypto, but it’s only available in certain states. You can trade in Bitcoin, Bitcoin Cash, Bitcoin SV, Dogecoin, Ethereum, Ethereum Classic, and Litecoin.
Stash is best for beginner investors who want a lot of guidance on selecting investments without any research tools or multiple asset classes. You can open tax-advantaged and taxable individual retirement accounts with Stash investments.
Since you are only buying fractional shares in ETFs, investors can pick between three categories to invest in, and these are named “I Believe,” “I Want,” and “I Like.” You can dig deeper into these ETFs, as Stash renames them to keep things simple. For example, the First Trust NASDAQ is a cybersecurity ETF that Stash lists under the “I Believe” category.
Basically, Stash tries to research the best ETFs and groups them for you, so that you can invest based on interests and industries.
Winner: You simply get more selections with Robinhood, although these are limited as well. If you are a beginner and simply want to join in on the game, you may like Stash’s approach to fractional ETFs.
Trade Experience and Security
Robinhood offers a streamlined, simplified approach to investing. While there is no manual account management, you get the basics. All trades can be performed on the mobile app.
Trade tickets are simple to place when you’re working with equities. You simply add the number of shares you want to trade and place the order. At first, the app’s default setting is to send market orders.
You can change this to a limit or stop order by clicking on the order type. The bid and ask prices are delayed and not updated in real-time like with other online brokerages. This delay makes it impossible to figure out the best prices in a fast-moving stock market, so it may lead to some issues if you are an active trader.
In fact, you might want to open another brokerage app with streaming data to ensure that you are placing the right order if you simply want to take advantage of Robinhood’s $0 fee guarantee.
Robinhood’s trade technology is a bit different than the industry. The brokerage reports their order flow on a per-dollar basis instead of a per-share basis.
The idea is that this is more accurate when presenting arrangements they have made with other market movers. This type of order flow technology could lead to more issues, specifically with inaccurate trade execution.
You can’t really customize your experience or automate bulk orders with Robinhood or Stash.
Stash simplifies investing for beginners by allowing them to invest by theme. It’s technical not a robo-advisor and will not manage any investments for you. However, it guides investors to select investments based on goals, risk level, and interests, rather than offering research and multiple investment types.
With their basic plan, you pay $1/month for a single account and add shares within collections based on interests, such as tech stocks.
There are over 100 options to invest with Stash, but this is rather limited compared to Robinhood and all other brokerages. It is best for those who do not know much about investing but wants to learn with guidance on how to improve their portfolio.
The app does not use any type of traditional orders. Instead, you are buying fractional shares of ETFs that are grouped together by Stash to be easier to understand. You can invest with as little as $5, and it will automatically invest extra funds based on your preferences. However, the fees are high even for small balances, and it has a high ETF expense ratio.
You are protected from fraud and loss through SIPC with both brokerages for up to $500,000. With Robinhood, you have login encryption and security challenges. Stash is not much different. They also use two-factor account authentication.
- Everything is free and simplified
- Simple market orders available
- No IRA accounts
- Easy-to-use for beginners
- Encryption and security challenges
- Invest with just $5
- Very simplified investing with fractional ETFs
- Automatically invests extra funds
- High fees for small balance accounts
- High ETF expense ratios
Winner: It’s easier to place active trades with Robinhood. With Stash, you get automated investing options that teach you how investing works, but it won’t work for most experienced traders or anyone who wants to trade in options or mutual funds.
Online Advisors and Educational Offerings
Both Robinhood and Stash are limited in their advisory, research, and education offerings. You can purchase a range of stocks, ETFs, and options with no fees, but the app and website do not feature streaming quotes.
You won’t find any education centers or robo-advisory tools. It’s best for those who can learn elsewhere or who already have a strategy and want to save money on commissions.
Many novice investors will like Stash because it does offer some guidance and teaches you about stock sectors. It’s mostly an automated investor that allows you to pick your interests by themes and groups ETFs together that you will like. Basically, you can set it and forget, and Stash will use its technology to make the best trades for you.
There are some educational articles and videos with Stash, but it’s pretty simplified and just explains their approach to fractional ETFs. You won’t learn about options strategies, new methodologies, or get any stock tips from this app.
Winner: Stash may be the better app for guidance, but neither of them really focus on advisors or education.
Mobile and New Trade Tech
Robinhood and Stash are easy to use on mobile. They were designed to be used on-the-go, making quick trades on your smartphone with just a tap of your finger.
With Robinhood, you get a news feed, customizable alerts, basic charting, and the ability to listen to earnings calls. You can use the app on iOS and Android. You can also trade on margin, and you can access a cryptocurrency exchange if you live in a supported state.
Stash is all about mobile investing, which is why everything can be done in the app. You can access all of your accounts and trade in 60 different ETFs. They also have a retirement calculator and Stash Coach, which offers more guidance within the app.
- Place market orders for stocks, ETFs, and options in app
- Customizable alerts
- No streaming quotes or guidance
- Offers cryptocurrency trading
- Intuitive mobile app designed for beginners
- About 60 ETFs and 150 stocks available
- Goal tracker and some tools available in-app
- Automated investing based on goals
Winner: Stash is more fluid and easy-to-use, but there are more options to trade on your phone with Robinhood.
Frequently Asked Questions: Robinhood and Stash
Is Robinhood or Stash Better for Retirement?
Robinhood is not designed for retirement planning. While you can invest in individual taxable accounts, there aren’t any options for IRAs or even investing in mutual funds.
However, Stash does allow you to set up multiple accounts, including traditional and Roth IRAs. While there are no mutual funds, you can use Stash to automatically fund your accounts based on shares you purchase in ETFs or stocks. For the novice investor trying to save for retirement, Stash offers better tools and investing options than Robinhood.
Can You place Your Own Market Orders with Stash?
Stash is meant to be a mobile investing app for beginners that automatically invests based on your preferences. While this is easy to use and builds money over time, you can turn this off and place orders in fractional shares.
However, the platform is not like any other brokerage, and you can’t place traditional market orders or complex orders. The most you can do is select the fractional ETFs and shares that you want to purchase manually.
Does Stash Offer 24/7 Customer Support?
No, but Stash does offer more than Robinhood. You can call their offices Monday through Friday, from 8:30 AM to 6:30 PM ET. They also are open Saturday and Sunday, from 11:00 AM to 5:00 PM. Email support is also available.
Robinhood only provides email support.
Which One is Right for You?
The right mobile trading app for you depends on your experience level and how you like to invest. Robinhood is for more traditional investors who want to place their own orders and like specific investment selections including stocks, ETFs, and options.
Stash works well for beginner investors who don’t know much about different investments or strategies. However, they may like tech stocks or they want to support different industries. These themes are used to group ETFs together, and with the expert guidance of Stash, investments are made to increase your portfolios.
Overall, Robinhood inches out ahead of Stash due to its investment selections, including cryptocurrencies, which makes it pretty special. However, if you are looking to retire with a nest egg and want more guidance, then it’s best to use Stash.