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Written by Beau Jordan on May 24, 2022
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Robinhood Fees Explained 2022: What Is The Cost?

Robinhood is a very familiar platform for most retail investors in the 21st century. Robinhood gained its popularity through successful marketing campaigns such as signing up or referring a friend to receive a free stock. Such marketing campaigns have become commonplace today but were really made popular from platforms like Robinhood. 

This platform has also become extremely popular because it has taken the power away from big investment platforms and has given it to the everyday investor. Through Robinhood it is easy to buy and sell stocks, cryptocurrency, and even participate in options trading. 

Additionally, Robinhood has one of the most user-friendly and simple platforms for investors with all skill levels. Buying and selling assets of all kinds has never been easier thanks to Robinhood. 

Robinhood was founded in 2013 and has had some astronomical achievements since creation. In 2015 the Robinhood mobile app launched paving the way for the retail investor. In 2018 Robinhood provided investors the opportunity to invest in cryptocurrency as well as options trading. 

One of the largest benefits that has come from this platform is that Robinhood is a commission-free trading account. However, even commission-free trading accounts can have fees!

To learn more about all of the advantages of Robinhood, head to our Robinhood Summary article. While this article will cover some of the advantages of using Robinhood, the main purpose is to cover all of the fees associated with the Robinhood platform. 

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Robinhood Fees


As introduced above, Robinhood is a commission-free trading platform. However, there are organizations called SROs or self-regulatory organizations that charge fees on all sell orders regardless of brokerage. 

Robinhood is not exempt to these fees and thus passes them along to the customer. Additionally, Robinhood has a premium offering that does come at a small price for investors. 

According to the official Robinhood website, there are four main buckets of fees associated with Robinhood accounts. The first three buckets are applicable fees to all investors while the fourth bucket is a premium offering. The four high-level buckets are listed below. 

  1. Regulatory Transaction Fee
  2. Trading Activity Fee
  3. American Depositary Receipt Fees
  4. Robinhood Gold Fees (Optional)

Regulatory Transaction Fee

The Financial Industry Regulatory Authority, also known as FINRA, is required by law to pay the regulatory transaction fee to the Security and Exchange Commission (SEC). FINRA takes this fee and passes it to its members, including Robinhood, who then pass the fees to the customers. 

This rate is subject to change throughout the year but is used to pay the government for regulating and supervising the security markets. This fee is to help pay for organizations such as the SEC. 

Luckily this fee only applies to sale orders and is relatively small. For every $1M of sales, the regulatory transaction fee is $5.10. In other words, this fee is 0.00051% of sale orders and is rounded to the nearest penny. 

Robinhood stands out from competitors because the platform only passes along the regulatory transaction fee for sales greater than $500. In other words, if you sell $350 worth of stock, Robinhood will pay the fee and you will not. Even if you have a sale greater than $500 though, the fee is extremely small!

Trading Activity Fee

The trading activity fee is a little bit different than the regulatory transaction fee. However, there are many similarities between the two fees. 

FINRA charges the trading activity fee to all brokerage firms to help pay for the regulation and supervising brokerage firms. Unlike the regulatory transaction fee, the trading activity fee is determined by the number of shares sold (rather than a percentage of the sale). 

The trading activity fee is $0.00013 for each equity share sold and $0.00218 for each option contract sold. This fee will always be rounded up to the nearest penny and is capped at $6.49 per order execution. 

Robinhood again stands out from competitors in that the platform only passes along the trading activity fee for sales of more than 50 shares. Typically those orders are larger orders so if you execute a sales order of 50 shares or less, you will not be paying this fee. 

American Depositary Receipt Fee

The American depositary receipts (ADR) fees are significantly different from the other two fees discussed. ADRs are certificates that are traded on American exchanges that represent foreign stocks. 

The banks that issue ADRs may charge $0.01 to $0.03 per share. If this charge is applicable, Robinhood will pass along these fees to the investor. 

Robinhood Gold Fees (Optional)

The final bucket of fees are for Robinhood Gold investors. Robinhood Gold is not included in a free membership with Robinhood. 

robinhood gold

Robinhood Gold provides investors with a premium platform experience. Investors will have access to extra research reports on individual stocks. Additionally, investors have access to level II market data. 

Level II market data provides investors with additional information surrounding trade volumes, bid and ask spread offerings, and asset prices. Typically level II market data is vital for day traders who need quick and live data for successful trades. 

A couple of other benefits of Robinhood Gold include investors receiving larger instant deposits. An instant deposit is where an investor can transfer funds to immediately use. This bypasses a waiting period of a couple of business days for the funds to settle from the bank. 

Additionally, Robinhood Gold may provide some traders with margin trading access. Margin trading is borrowing money from Robinhood to fund investments. This is a much riskier benefit so not all Robinhood Gold members will be eligible for this benefit. 

Robinhood Gold is available to all investors for a fee of $5 a month. This fee is eligible to adjust so investors should keep an eye out on rates if they decide Robinhood Gold is right for them. 

Robinhood Fees: Final Thoughts

Robinhood has been instrumental in the era of the retail investor. The platform also found extreme success by being one of the first commission-free trading platforms.

As this article discussed, even commission-free trading platforms have fees that they pass along to customers. However, it is important to recognize that these fees are originating from entities outside of Robinhood. In other words, they are common fees among all investing platforms. 

As a quick recap, the four buckets of fees are shown below. 

  1. Regulatory Transaction Fee
  2. Trading Activity Fee
  3. American Depositary Receipt Fees
  4. Robinhood Gold Fees (Optional)

The only fee that originates from Robinhood is the Robinhood Gold membership fee. This fee is completely optional and is not required to use the platform. However, those who hope to have access to Robinhood Gold benefits can pay a fee of $5 a month. 

It is also important to understand that this article does not include a comprehensive list of fees. The above fees are the common fees that apply to the majority of transactions. There are additional fees that cover anything from requesting paper statements to transferring funds outside of Robinhood. 

To get the complete list of fees, as well as an update on all fee costs, feel free to check out Robinhood’s fee one pager

Since creating a Robinhood account is free, feel free to use one of Investing Simple’s affiliate links to get a free stock from signing up!

Article written by Beau Jordan

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