August 31, 2020

Robinhood vs Webull

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Robinhood and Webull both offer commission-free trades for stocks, ETFs, and options. Find out which free investing app is best for you.

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Webull and Robinhood are similar trading apps offering free investing with zero commissions. The main difference is that Robinhood offers fractional shares while Webull has a more advanced platform.

Which one is best for your investing needs? Read on for the detailed comparison review.

About Robinhood and Webull

Robinhood shook up the investing world in 2013 when it introduced a completely commission-free trading app.

Previously, brokers charged $5-$7 per trade. This could be hard for beginners with small amounts of money. Now, most major brokerage companies have followed suit and got rid of standard trade fees.

You can trade stocks, ETFs, options, and even cryptocurrency on Robinhood for no trade fees.

Established in 2017, Webull is Robinhood's biggest competitor, also offering free stock, ETF, options, and cryptocurrency trades.

This brokerage platform aims to combine finance with technology to provide a better investing experience. It offers advanced real time market data, charting, and analytics to help users make smart decisions.

Bottom line: Which is better Webull vs Robinhood?
Robinhood is better for beginners, as it's easier to use and offers fractional shares. Webull is a better choice for more experienced active traders, as it offers more advanced research and charting. However, Webull does have a practice paper trading account, whereas Robinhood does not.

Who Each App Is Best For

Robinhood is better for:

  • Beginner investors looking for a basic platform
  • If you have less money to invest

Webull is better for:

  • Active more experienced investors
  • Long term investors (Webull offers retirement accounts)
  • Short sellers and margin traders

Key Similarities

Here is an overview of what both Robinhood and Webull offer:

  • Completely commission free trades
  • Stocks, ETFs, options, and cryptos
  • Individual taxable accounts
  • No account minimums
  • Margin accounts with $2,000 minimum
  • Unlimited day trading for accounts $25,000+
  • Real time market updates
  • Web platform and mobile trading on Apple & Android

Both investing apps are self-directed. Neither offers investment guidance or recommendations. So you need to have an idea of what you want to invest in. If you're someone who wants to be completely hands off, look into a robo-advisor instead.

Key Differences

Here are some ways in which they differ.

Robinhood offers:

  • Fractional shares; invest in stocks with as little as $1
  • Dividend reinvestment (DRIP)
  • Deposits up to $1,000 are instantly available
  • Cash management account

Webull offers:

  • IRA accounts (Traditional, Roth, and Rollover)
  • Paper trading account (trading simulator)
  • Longer extended trading hours
  • Allows short selling
  • More in-depth research tools and charts
  • 24/7 customer support online and by phone

Detailed Comparisons

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Now let's get into the detailed comparisons of Robinhood vs Webull.

Account Opening and Trading Fees (Tie)

Both Webull and Robinhood have no minimum investment requirement to get started.

Both offer commission free trading for stocks, ETFs, options, and cryptos. Both have zero contract fees for options trading.

Both have no minimum account balances, unless you want to trade on margin (in that case, both require $2,000 minimum). Webull's margin account is free, while Robinhood requires you to upgrade to the Gold account for $5 per month.

Sign up Bonus: Free Stock (Robinhood)

Robinhood gives you one share of a free stock when you open an account, valued between $2.50 to $225. You can keep or sell the free stock after two trading days.

Robinhood also has a referral program. Robinhood gives you a free stock when your friend joins (up to $500 in reward stocks each calendar year).

Investment Options (Robinhood)

Both Robinhood and Webull allow you to trade stocks, ETFs, options, and cryptocurrency with no trading fees.

Cypto is new to Webull as of November 2020. It offers Bitcoin, Bitcoin Cash, Ethereum, and Litecoin. Robinhood offers a couple more crypto options, including Dogecoin.

Neither trading apps offer mutual funds, bonds, futures, or forex.

Both also allow you to get in early on IPOs. Robinhood has a Pre-IPO trading program where you can place orders for certain stocks before their initial public offering. Webull offers a limited selection of IPO offerings. It has calendars to show upcoming IPOs.

Account Types (Webull)

Robinhood only offers individual taxable accounts. Webull offers taxable accounts and as well IRAs (Traditional, Roth, and Rollover).

Neither platforms offer joint, custodial, trust, or 529 college savings accounts.

Trading Hours (Webull)

Both offer free extended trading hours, but Webull has longer hours.

  • Robinhood's hours are 9:00 am to 6:00 pm.
  • Webull's hours are 4:00 am to 8:00 pm.

Account Features (Robinhood)

Fractional shares
Robinhood support fractional shares, while Webull does not. This gives you the ability to just buy a tiny piece of a share if you don't have enough money for a full share. This makes Robinhood better for new investors without a lot of capital.

Let's say you don't have enough to purchase one full share of Apple stock at $450, you can just buy 1/10 of a share for $45. Robinhood lets you purchase fractional shares starting from just $1.

Dividend Reinvestment
Robinhood offers a Dividend Reinvestment program (DRIP). Any cash dividends are reinvested back into the specific stock. Webull does not reinvest dividends.

Instant Deposits
With the default Robinhood account, you get $1,000 in instant deposits. This means whenever you make a deposit, $1,000 will be available to trade with immediately (instead of waiting the usual 5-6 days for ACH transfer to clear).

Webull does grant a partial credit before your deposit settles, but it's not as clear how much you get. The credit is based on your account type, cash balance, net account value, credit history, and other factors.

Research and Tools (Webull)

Robinhood is a basic online brokerage with a simple trading platform. It lacks the market research and tools of more advanced platforms. This makes it easy to use for beginners, so you're not overwhelmed with a ton of features.

Robinhood's tools include:

  • Organize stocks by sector. Compare stocks side-by-side
  • View the average price per share that Robinhood investors paid (helps you judge if the stock is a good buy or not)
  • Real-time market updates on stocks in your watch list
  • Candlestick charts with 5 indicators

Robinhood also has a premium account called Robinhood Gold, which offers more research. Premium members also get Morningstar research reports and Level II market data.

In comparison, Webull's platform looks more like a pro platform. There will be a learning curve for new investors. It has more advanced research offerings and technical analysis that experienced users will appreciate.

Extra features include:

  • Price alerts for stocks in your watchlists
  • Stock screeners
  • Market data from 5 categories and 100+ exchanges
  • Charting with 45 technical indicators
  • Analyst ratings for buying or selling an asset

Webull offers a more advanced trading experience. It has more analytic tools to help you get a handle on your investments, and thus a better chance to profit.

Margin Trading (Webull)

Margin trading is when you borrow funds from the broker to purchase stocks. This increases your buying power and have the potential for higher profits (but also higher risk).

With Robinhood, you can only open a margin account if you upgrade to the premium Robinhood Gold subscription, which costs $5 per month.

You must have minimum balance of $2,000 to be a member of Robinhood Gold. Your first $1,000 of margin is included. If you borrow more than that, you'll pay 5% yearly interest on the amount you use above $1,000.

Webull offers everyone access to a margin account (no extra monthly fee). But the margin interest rate is higher than Robinhood's, starting at 6.99% up to $25,000 loan. The margin rates decrease with higher margin loans. The minimum account value is also $2,000.

Day Trading (Tie)

Both Webull and Robinhood allow you to perform up to 3 day trades in a five trading day period. For investors with $25,000 account balance or more, you can make unlimited day trades.

Robinhood also has a cash account option that no restrictions on day trades. However, this account does not have instant deposits or instant access to funds, so you'll have to wait 5 days for funds to settle.

Paper Trading (Webull)

Webull offers a paper trading account with $1,000,000 in fake money. You get access to all the full features of the platform. You can get used to it and practice trading strategies before committing real money.

This may sway the decision for beginners, especially if you want to try out different ideas or learn trading options.

Even though Robinhood is more geared towards beginners, it does not have a practice trading account.

Short Selling (Webull)

Webull supports short selling in its margin accounts, while Robinhood does not. This is a trading strategy where an investor borrows shares and sells it to the market, with the bet that the stock price will drop. Then they buy it back at the lower price and return to the lender, thus making a profit.

This feature is available on Webull's mobile app, so you can execute a trade at any time on your smartphone.

Short selling is definitely for advanced stock traders. There is a lot of moral controversy surrounding this approach, but if this is something you may be interested in, Webull allows it.

Market Orders (Webull)

Both Robinhood and Webull allow you to execute the following orders:

  • Market orders
  • Limit orders
  • Stop orders (stop loss order)
  • Stop limit orders

In addition, Webull also supports these advanced order types:

  • Stop-loss/take-profit orders (bracket orders)
  • OCO (one cancels the other)
  • OTO (one triggers the other)

Webull allows you to execute more advanced orders, so it's better for the more experienced trader looking to limit their losses when trading stocks.

Customer Support (Webull)

Webull offers better customer service than Robinhood. Webull's customer support team is available 24/7 via email and phone. Anyone can contact them with questions, even if you're not a user yet.

Robinhood only offers customer support via email once you're a user. There is no phone support or live chat available.

Both offer a large help center on their websites, so you may be able to find the answer to your questions on your own.

Bottom Line

The two trading platforms, Webull and Robinhood, are very similar, both offering commission free trading.

Ultimately, it depends on how experienced you are. Robinhood is better for beginners who prefer simplicity, while Webull's more extensive tools are better for advanced traders. Both investing platforms have their strong points and weak areas.

If you really can't decide, you can sign up with both since there's no rule against having brokerage accounts at both companies. For example, you can use Webull for margin trading and IRA, and use Robinhood for normal stock trading and cryptos.

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