Robinhood is a popular investing app that offers commission-free trading for stocks, ETFs, and cryptocurrencies.
Once you've bought a stock on Robinhood, you may decide to sell it and cash out your profits. There are a few steps involved with this process that we will dive into.
Here's how to sell stock on Robinhood and cash out your funds.
New to Robinhood? Check out my tutorial for beginners below!
First of all, in order to cash out funds from Robinhood, you may need to sell a stock, ETF or crypto that you own.
To sell a stock on Robinhood, you first need to navigate to the stock's detail page. You can do this by searching for the stock in the search bar at the top right of the home screen or by scrolling through your portfolio until you find the stock you want to sell.
Once you've found the stock you want to sell, tap "Trade" at the bottom of the screen.
On the next screen, tap "Sell" to start the process of selling your shares.
In the upper right corner of the screen, you'll have the option to choose whether you want to sell your shares in dollars or shares. Choose the option that works best for you.
Before you submit your sell order, review the details to make sure everything is correct. You'll see the number of shares you're selling, the price you'll receive per share, and the total value of the sale.
If everything looks good, swipe up to submit your sell order.
Assuming you used a market order, your sell order will be executed at the next available market price.
It's important to note that the settlement period for equities on Robinhood is the trade date plus 2 trading days (T+2), which means it takes two business days for your funds to settle after a sale.
After the third day, your proceeds will be available as withdrawable cash.
So if you just sold off an asset in Robinhood, you might need to wait 3 business days before you can cash out.
Once you've sold your stock on Robinhood and the funds have settled, you may want to transfer the funds to your bank account or debit card.
To cash out on Robinhood, first select the account icon at the bottom right-hand corner of the screen.
Next, select "Transfers" from the menu.
Choose the account you want to withdraw money from - which will be Robinhood if you are looking to withdraw funds to your bank account.
Select the linked account you want to withdraw the money to. This can be a bank account or a debit card.
Enter the amount you want to transfer from your Robinhood account to your external account.
Before you confirm your transfer, review the details to make sure everything is correct. Robinhood offers instant transfers for a fee, but standard transfers come with zero fees.
Finally, select "Transfer" to initiate the transfer of funds.
The transfer can take up to 3 to 5 business days to reflect in your bank account. If you choose an instant transfer, it will normally show up within just a few minutes.
While Robinhood is known for its commission-free trading, there are still small regulatory fees that apply when selling stocks. These fees are not charged by Robinhood but are instead imposed by financial regulators.
Though these fees are minimal, it’s important to be aware of them, especially if you engage in frequent trading.
When you sell stocks on Robinhood, you may be subject to capital gains taxes, depending on how long you held the stock and how much profit you made.
Robinhood operates using a business model called Payment for Order Flow (PFOF), which allows the platform to offer commission-free trading.
