Written by Matthew Cerminaro on September 3, 2020
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TradeStation vs Robinhood 2020: Best Brokerage?

Picking the right online broker can be a difficult task.

With so many options on the market now, it can be tough narrowing down the best fit for you. There is no one size fits all broker, and that is why we at Investing Simple are determined to help you find a broker that matches your goals.

In this article, we will be reviewing TradeStation vs Robinhood.

Both of these brokers have their own features, pros, cons, and fees, all of which will be covered below. We hope you enjoy and our content can help you make a decision on which broker suits you best. Now let's get started!

Summary: Robinhood vs TradeStation

  • Both brokers specialize in stock, option, and ETF trading on their platforms
  • TradeStation has a wider array of financial products than Robinhood including bonds and futures
  • TradeStation has a tactical trading platform with paper trading capabilities
  • Both have high quality and easy to use mobile apps
  • TradeStation makes a charge per contract on options trades while Robinhood is completely free
  • TradeStation offers a wider variety of accounts than Robinhood
  • Both brokers have limited availability to market research
  • Robinhood has a fractional shares initiative that lets you buy portions of stocks
  • Robinhood has a stock referral program for you and a friend to both receive a free stock when signing up

What Is TradeStation?

TradeStation is an online brokerage where you can invest in many different financial products. TradeStation has many different offerings ranging from stocks and ETFs to futures and options.

This brokerage is committed to keeping the costs of investing low while still offering a broad range of securities. To back up this initiative, it has implemented various pricing policies and continues to expand the investment products that it offers.

TradeStation Features

Zero Commissions

Buying and selling stocks can be costly, but TradeStation's zero commissions on all stocks and ETFs make investing with the broker a cheap option.

You can trade all of these stocks and ETFs in real-time as well, as TradeStation offers real-time data for all of these securities for no extra cost.

TradeStation Mobile

TradeStation's mobile app gives you all of its features right at your fingertips!

While being simple and beginner-friendly, it is also very powerful as you can make trades, see real-time quotes, and so much more right in the palm of your hand. If you are more comfortable with being on a laptop/computer, TradeStation also has a web platform where you can find all of its normal features.

why trade stocks

Desktop Platform & Paper Trading

One main feature that TradeStation offers is its advanced desktop trading platform.

Here you can access technical charts of stocks and ETFs and make trades directly. If you are feeling less comfortable and are just looking to practice, there is a paper trading account offering as well where you can buy and sell securities with fake money.

This is a great option if you are looking to learn about the stock market without having to commit any money down.

Educational Content

TradeStation's educational content offered on its website gives the broker a leg up against many others.

From watching people trade live, to course offerings, to free webinars, TradeStation has a wide variety of educational services that you can access simply for opening up an account with them.

Retirement Accounts

If you are looking to plan for your future and access tax-incentive brokerage accounts, TradeStation has you covered.

Offering a Traditional IRA, Roth IRA, SEP IRA, and Simple IRA, TradeStation's wide variety of accounts will service all of your retirement needs.

TradeStation Pros

  • Tactical trading platform lets you analyze charts for enhanced trading capabilities
  • Various retirement accounts including Roth and Traditional IRA
  • No commissions on all stock and ETF trades
  • Educational content including live trade webinars offered
  • Diverse array of financial products available including options, bonds, and futures

TradeStation Cons

  • Per contract fees on options are pricey
  • Limited market research offered
  • Customer service has been regarded as hard to reach
  • No automated investing feature

What Is Robinhood?

Robinhood is an online broker that is headquartered in Menlo Park, CA. It is most well-known for its stock, ETF, and options trading capabilities on its platform, as well as a sleek mobile app that is sure to simplify the investment process.

Above all, it has a track record of providing exceptional services to its users.

Robinhood Features

Mobile App

Robinhood's mobile app won the Google Play Award in 2015, largely for its ease of access and usability.

From personal experience, I can say that this app is fantastic especially for newcomers. It makes the features that Robinhood offers very accessible and lays them out in an understandable way.

You can trade 1000's of stocks, ETFs, and options right at your fingertips, and did I mention for no extra cost?

Zero Commissions

$0 commissions? That seems impossible, but Robinhood has managed to implement the feature on its platform.

From stocks to ETFs to options to crypto, Robinhood shines at being not just a low-cost, but a no-cost trading service!

This is perfect if you have a smaller account and are looking to make trades on many stocks. With a traditional broker (that has commissions), extra fees would eat at principal investment, but Robinhood's commitment to democratizing the financial markets means it charges nothing.

Zero Account Minimum

And what can be even better than $0 commissions? How about a $0 account minimum!

Fractional Shares

If you are looking to trade some a stock that is out of your budget, Robinhood has you covered with its Fractional Shares feature.

Instead of committing money for a full stock, you can buy portions of companies for as much as you desire. This means broader diversification possibilities with less money, a golden rule of successful investing.

Robinhood Cash Management

This is an online savings account for your uninvested cash.

Those who are patient with their investments and often have money sitting around in their account may find this to be a very rewarding feature!

YieldAs Of
0.30% APY9/17/20

Get a Free Stock With Robinhood!

If you sign up with our link below, you will get a free stock! You also earn more free stocks when you invite your friends to try Robinhood.

Robinhood Fees

Robinhood has to make money, and it does so through two main ways; fees from Gold memberships and from margin.

Robinhood Gold

Robinhood Gold is the upgraded account type from the free Robinhood account.

Gold will give you access to market research and also margin trading. Robinhood Gold comes in at a price of $5 charged monthly.

If you are interested in market research and want to trade on margin, this may be worth the $5 monthly fee.

robinhood gold

Margin Trading

Robinhood makes money off of interest charged on the margin that it provides to its users.

Margin is borrowed money from a broker, but it is not free money. Margin interest rates are variable and change based on the federal funds rate, so make sure to check Robinhood's website and be aware of what the broker is charging.

Remember that margin trading can be very risky. Trading on margin requires well-educated investing principles and risk management.

Robinhood Pros

  • Award-winning mobile app that is easy to use and beginner-friendly
  • $0 commissions on all stocks, ETFs, options and crypto
  • Cash management account lets you earn on cash that is uninvested
  • Free stock initiative for you and a friends to benefit
  • $0 account minimum or Robinhood Cash accounts

Robinhood Cons

  • No bonds/futures offered
  • Customer service has previously been described as hard to reach
  • No ability to short on the platform
  • Limited account offerings
  • Not an automated investing service, so you have to pick your securities (could be good or bad depending on your experience investing)
  • No retirement accounts

TradeStation vs Robinhood: The Final Verdict

TradeStation and Robinhood are both exceptional online brokers that offer top quality features and services in a low-cost way. It all comes down to personal preference for choosing which may be your best fit, however.

If you are looking for a wider array of accounts and a tactical trading platform, TradeStation may be a great choice for you.

If you are more interested in trading things like options, Robinhood may be a great choice due to its competitive pricing advantage for options trades. Either way, you cannot go wrong with either of these brokers.

It all depends on your personal goals and what you look for in an online broker.

Keep Reading:

TradeStation Vs Robinhood
Article written by Matthew Cerminaro
Matt is currently attending Union College pursuing a Bachelor of Arts in Economics. He participates in the student investment fund and is a member of the Union College football team. Matt runs his own personal finance Instagram page and market-related blog where he writes about economics and general wealth accumulation tips.

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