May 25, 2021 12:00 PM PT

Public Review

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Do you wish your investment portfolio could reflect the things you care about - like green energy or wellness? Public does just that, commission-free.

Public is the latest investing app to join the commission-free bandwagon.

But they've got a few strong selling points that help them stand out.

In this review, find out which features are their best and if they're safe. Plus, see what fees they charge and how Public compares to platforms like Robinhood and M1 Finance.

What is Public?

Public was originally founded as "Matador" in 2018 by finance professionals Jannick Malling and Matt Kennedy.

In 2019, the investing app was re-branded and re-launched as Public, with a focus on social and transparent investing. Their goal is to have a platform where like-minded investors could easily connect and collaborate on the investments and industries they follow.

Public creates this collaborative environment by offering dozens of different investment themes, such as:

  • "Combat Carbon" - companies reducing carbon footprints
  • "Women in Charge" - public companies led by female CEOs
  • "Space Exploration" - companies poised to benefit from space exploration

Each theme includes a dozen or so stocks and ETFs that reflect the topic. It also serves as a mini collaborative investment community where you can follow and chat with other investors in that theme.

Like most commission-free investing platforms, Public's offerings are limited to U.S.-listed stocks and ETFs. So, it's not ideal for someone who trades foreign or OTC stocks, bonds, options, or any of those more exotic security types.

It is, however, ideal for thematic investors and those looking for more transparency than you would find with the Robinhoods of the investing world (more on that later).

Is the Public stock trading app legit?
Public is 100% legit. They are one of the most transparent investing apps we've researched. They even tell you exactly how they do (and how they don't) make money.

Public.com

Get a Free Slice of Stock

  • Invest in Stocks and ETFs, Commission-Free and No Account Minimums
  • Follow other investors, share insights, and build your financial literacy within a transparent community
  • Offer valid for U.S. residents 18+ and subject to account approval. There may be other fees associated with trading. See Public.com/disclosures/

Pros and Cons

Want the basic takeaway? Review these pros and cons before signing up with Public.

Pros

  • Invest in your passion with themes
  • Highly collaborative community
  • Commission-free trading
  • Offers fractional shares
  • Fund your account faster with a debit card
  • Commitment to transparency
  • Does not engage in PFOF

Cons

  • Limited investments (~5,000 U.S.-listed stocks and ETFs)
  • No portfolio building tools
  • Does not offer access to financial advisors
  • Non-margin accounts are subject to good faith violation restrictions

Is Public safe to use?
Yes, Public is a member of SIPC and so your investments and cash in your Public account are protected in the off chance Public goes under. They also have a 4 out of 5-star rating on the Better Business Bureau.

How it Works

Looking to personalize your investing approach and collaborate with other traders? Here's how Public works, and what sets it apart from the pack:

Themes
Public is all about thematic investing. They offer a few dozen different investment themes, from global concerns like recycling and reducing carbon to the latest technological frontiers, like self-driving cars and virtual reality.

Once you've selected the themes you're interested in, you can easily browse the list of companies and ETFs that are working on these initiatives.

Social & App Features
You can do limited research on the app (e.g., company and brand history), see what other Public investors are saying about each company, and then make your investment.

The social aspect of Public allows you to easily follow other investors and see what stocks they hold in their portfolio, and the app will also recommend other users for you to follow based on the themes you are interested in.

App Download: App Store, Google Play

Fun Fact:There are even some celebrities who invest on Public, if that sort of thing interests you.

Investing Features
Public allows you to invest in fractional shares, called "Stock Slices". This is especially useful if you want some Amazon exposure for instance, but not a full $3,000 worth!

They even let you set up automatic dividend reinvestment so you can purchase more stock with your earnings.

They also let you fund your account using a debit card (up to $1,000/day), which is helpful when you don't want to wait the 2-3 days it usually takes for an ACH transfer to clear.

Can you day trade on Public?
While you can day trade on Public, it's probably better to open a margin account with another broker if you are a day trader.

This is because frequent traders are more likely to make a "Good Faith Violation," which is when you buy a stock and sell it before the trade settles (in 2-3 days) and then use those unsettled funds to buy another stock. If you do this three times in a year, your account will be suspended for 90 days.

Fees

Investing on Public is commission-free.

However, they do have the following fees (which they say most Public users never incur):[1]

  • Broker-assisted phone trades: $30/trade
  • Domestic wire transfer: $30
  • Domestic overnight check delivery: $35
  • Returned check, ACH, wire & recall/stop payments: $30
  • Choosing paper statements: $5

Their full fee schedule can be found here.

While they have hinted at rolling out an optional subscription service in the future, nothing like this is currently offered.

So, how does Public make money?
Public makes money from securities lending and interest on your un-invested cash. Unlike most commission-free apps, Public claims to not engage in Payment For Order Flow (PFOF).

PFOF is a common practice where the broker receives a rebate/cash incentive from a market maker in exchange for letting them execute your trade.

PFOF creates a conflict of interest since the broker's duty is to get you the best execution. Because Public does not do this, they have a purely optional feature where you can give them a "tip" when making a trade.

Public Alternatives

There are many other players competing with Public in the commission-free investing space, and each one tries to craft its platform in a somewhat unique format to try to appeal more to certain investors or traders over others.

Some apps, like Robinhood, offer derivatives and crypto, while others, like M1 Finance, offer thematic investing similar to Public. We'll take a look at some of their leading competitors below and how they measure up to Public.

Public vs Robinhood

 Public.comRobinhood
 Visit SiteVisit Site
 

Public.com

Robinhood

SPECIAL OFFER
Get a Free Slice of Stock - Learn More

OFFER
Get a Free Stock (worth between $2.50 and $225) - Learn More

 

Benefits and Features

Stock Trading
$0
$0
Options Trading
No
$0
Annual Fee
None
All trades are commission-free. No platform fees.
Minimum Deposit
$0
$0
Mutual Fund Trading
No
No
Banking
N/A
No service fees for Robinhood Cash Management account. Free debit card with no in-network ATM fees or foreign transaction fees
Mobile App
Check
Yes
 Visit SiteVisit Site

Robinhood: Pricing information from published websites as of 04/18/2020.

Robinhood also offers commission-free trading and shines for the variety of security types supported on their platform.

Robinhood investors can trade U.S.-listed stocks, ETFs, ADRS, options, futures, and many crypto currencies. They also offer margin accounts through their "Robinhood Gold" subscription for $5/month. These features help position Robinhood as an ideal app for day traders.

Robinhood is well-known to make most of their money from PFOF, which is an inherent conflict of interest. They also saw a strong backlash from their decision to restrict trading in GameStop and other highly shorted stocks in early 2021. Many saw that move as unfair and preferential to hedge funds.

Public puts their investors first, and for this reason, we'd generally recommend them to long-term investors over Robinhood.

Public vs M1 Finance

 Public.comM1 Finance
 Visit SiteVisit Site
 

Public.com

M1 Finance

SPECIAL OFFER
Get a Free Slice of Stock - Learn More

SPECIAL OFFER
New Customers: Deposit $1,000 and Get $30 - Learn More

 

Benefits and Features

Stock Trading
$0
$0
Options Trading
No
No
Annual Fee
None
None
Minimum Deposit
$0
$100
Mutual Fund Trading
No
No
Banking
N/A
All users can open a M1 Spend account with free debit card. No monthly service fees and no balance requirements.
Mobile App
Check
Check
 Visit SiteVisit Site

M1 Finance: Pricing information from published website as of 02/28/2020

M1 Finance is probably the closest competitor to Public because they also offer their own version of thematic investing - called "pie investing."

M1 Finance offers 80 prebuilt "pies"; each represents a unique collection of individual stocks and ETFs that reflect a specific theme or sector, like dividend stocks or green energy companies. And besides these prebuilt pies, investors can also "bake" their own, combining a custom mix of stocks that they like.

But M1 Finance doesn't offer the collaborative, social environment that Public does. They also don't offer real-time trading, which is a big drawback as the M1 investor can't time their trades to certain times of the day in response to price changes.

Overall, we think Public is the better option for thematic investing given their collaborative and transparent platform.

Public vs Acorns

 Public.comAcorns
 Visit SiteVisit Site
 

Public.com

Acorns

SPECIAL OFFER
Get a Free Slice of Stock - Learn More

SPECIAL OFFER
$10 Sign-Up Bonus - Learn More

 

Benefits and Features

Stock Trading
$0
Part of service fee. No add-on trading fees.
Options Trading
No
No
Annual Fee
None
$1/mo for Acorns Lite (taxable account only)
$3/mo for Acorns Personal (includes IRA and checking account)
$5/mo for Acorns Family (includes investment accounts for kids)
Minimum Deposit
$0
$0
Mutual Fund Trading
No
No
Banking
N/A
$3/mo for Acorns + Acorns Later + Acorns Spend checking. Free debit card, no minimum balance, no overdraft fees, and unlimited free or fee-reimbursed ATMs nationwide.
Mobile App
Check
Yes
 Visit SiteVisit Site

Acorns: Pricing information from published website as of 09/28/2020.

Acorns is an investing app based on the unique concept of investing your spare change, which in theory should give more Americans access to the stock market.

Every time you use your credit or debit card, the app will automatically round up your purchase to the nearest dollar and invest the change for you. You can choose between a few basic, diversified portfolios of ETFs with varying risk levels.

While it's a novel idea, Acorn's fees make their platform too expensive compared to other brokers. Their monthly fee varies from $1 to $5 depending on how many accounts you have.

While this doesn't seem like much, it's actually a big percentage of your balance. Most accounts on Acorns will be fairly small, as they consist of accumulated pocket change.

For this reason alone, we would recommend Public over Acorns.

Bottom Line: Is Public Worth It?

Many investors today - especially millennials - are increasingly looking to make investments that reflect the global issues they care about and the emerging technologies that are addressing them.

Their investment process is increasingly about collaborating with their like-minded peers instead of purely competing with them. And they want to do all this in a cost-efficient manner with a transparent broker that puts them first. If this sounds at all like you, we highly recommend giving Public a try.

References

Write to Andrew Fitzgerald at feedback@creditdonkey.com. Follow us on Twitter and Facebook for our latest posts.

Note: This website is made possible through financial relationships with some of the products and services mentioned on this site. We may receive compensation if you shop through links in our content. You do not have to use our links, but you help support CreditDonkey if you do.

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