The market used to be extremely inaccessible to most of the general public for quite some time. Slowly this started changing with the internet and average people started finding their way around the market.
Realizing that the market required a lower volume and more competitive exchange for the retail trader, changes such as Webull and Robinhood began popping up. These exchanges are alluring for the sole reason that they offer no commission trading, which is absolutely amazing.
Day traders can appreciate the reduced pressure to cover the fee difference immediately placed on them when entering a trade. Not having to worry about fees during intraday means a lot more cash in your account!
Taking the fees out of investing for lower volume retail traders allows them to be far more competitive and stand a much better chance at creating profitable trades.
Webull and Robinhood are two of the “free-trading” exchanges to become well known with the retail trading market. Today we will jump into a few differences between the two and see which one is a better fit for you.
Webull
A commission-free stock and ETF trading platform for the active retail trader. Expertly designed, Webull offers traders all the expert trading tools such as margin, research tools, and live data to help you make more educated and informed decisions.
The Webull exchange platform offers a lot more tools and functions than most similar competitors do.
With so much put in front of you all at once, Webull is not the most beginner-friendly platform to use for entering the market for the first time.
However, once adjusted you will appreciate what the Webull experts came up with.
Robinhood
This commission-free exchange is known for pioneering the idea in the first place. Made even more infamous by the GME hype, Robinhood has become a household name which is exactly where they want to be.
Robinhood is a very intuitive and easy-to-use simple trading platform designed with beginners in mind.
The new retail traders who are inspired and motivated by the latest market trends are attracted to Robinhood because of the simplified exchange interface.
Robinhood also offers fractional shares for investors not looking to go all-in on some of the bigger stocks out there.
Expert and intermediate traders can find it a bit lacking but this is just right for the simple retail trader not looking to maintain a minimum balance or activity level.
The biggest takeaway is that RobinHood has no fees or hidden catches of any kind, offering a stress-free trading and learning experience.
Services Offered
Minimums And Fees
WeBull and Robinhood both offer retail traders no trading commissions, along with a 0$ minimum balance. Both Platforms offer Taxable, and Margin trading accounts, with Webull also including IRAs into the exchange platform.
Fractional Shares
Robinhood allows traders to buy Fractional Shares which is a big incentive for those investors who want to get in on big-name stocks but can’t buy one all at once.
Names like Amazon and Astra Zeneca whose stock prices are in the thousands of dollars are now accessible to retail investors looking to just get a bit of the action. Currently Webull does not offer this trading option.
Trading Simulator
Webull offers its account holders access to a “practice” account with 100 thousand dollars in pretend currency. Offering account holders a chance to participate in trading competitions and earning prizes in real life for it.
Practice accounts like these are a wonderful feature for testing out trading strategies and confirming your theory before throwing your hard-earned money into the market.
We highly recommend using a practice account at first to get a feel for everything and only once comfortable start using real money.
It can be really beneficial to practice the motions before doing the real thing. It can alleviate a lot of stress and help prepare you mentally for the daily challenges of trading. I want to stress how important it is to mentally prepare yourself to handle swings in your account balance.
It may not seem like it at first but trading the market is very very different once your cash is on the line. Practice accounts are not just for new traders.
Many veterans and experts use practice accounts to sharpen their skills and practice theories for technical or fundamental trading strategies.
IPO Investing
An IPO is an Initial Public Offering, and it refers to the process of offering a private company shares out to the public in a new issuance. A company would create an IPO if they were looking to raise capital from public investors.
Getting in on ground zero of a company offering its share is usually a great way to earn some money with a bit of patience. IPOs of popular private companies can cause investing frenzies and generate billions in capital for the company and further propelling its success providing a return on your investment.
Webull provides access to Initial Public Offerings of various stocks. An extra little feature is really appreciated by certain traders. Robinhood, unfortunately, does not have the same offering, however, these opportunities don’t come around that often.
Trading Tools
As mentioned previously Robinhood does not have a very advanced feature set, it’s a more basic and simplified user interface for the beginning investor.
There are of course some simple tools, but nothing an advanced trader would appreciate.
This brings me to Webull, their exchange platform offers a very large variety of tools for maximizing your information going into a trade.
Most importantly is a good chart with technical indicators.
This is ground zero for most investors and Webull offers over 25 technical indicators as well as some advanced order types not usually seen on free exchange platforms.
A trading simulator is an indispensable tool for most advanced traders, and Webull provides one funded with 100 thousand guilt-free dollars to practice with.
It’s upsetting that so few trading platforms offer practice accounts, they are critically important and just make for good practice. Robinhood does not offer a practice account, currently only Webull provides one.
Webull offers access to a variety of research tools for both the technical and fundamental trader. Relevant events such as press releases, earnings reports, dividend dates, financial documents, and analyst ratings are only some of the various informational tools offered by Webull.
A stock screener is a useful tool for pinpointing stocks that align with your trading strategies. Webull offers a stock screener that allows you to filter stocks based on country, price, market cap, P/E ratio, Dividend Yields, and plenty more.
Coupled with a watchlist, an investor can filter out specific investment opportunities, throw them on an easy-to-access watchlist. Setting a price alert on your watchlisted stocks is a great way to always stay on top of your potential investment opportunities.
Final Note
Both Webull and Robinhood offer the same commission-free trading with no minimum account balance that retail investors are interested in.
Both platforms offer nearly the same services except the biggest defining factor between them are the unique features geared towards specific groups of traders.
Robinhood is for the beginner looking to get into their first year of trading and have a smooth learning process while doing so. Webull is designed for the more advanced user looking to use more tools for placing traders. If this isn’t your first rodeo, the Webull platform is for you.
Customer Service is a very important matter when it comes to financial markets and accounts. Imagine wanting to buy a stock and not being able to log into your account and not being able to reach customer service.
You cannot call in and deal with someone personally. Webull on the other hand has a customer service number posted so that you can call in and ask questions, get guided through a trade, or recover your account info. Webull takes the prize when it comes to the Customer Service Department.
Overall Webull has a slight upper hand over Robinhood. The additional charting tools, trading simulators, and customer service push Webull ahead of the competition. Webull recently added free IRA trading which is not something offered by the competition either.
Robinhood’s redeeming features are that they offer dividend reinvestment and fractional trading, offering the novice trader an easier time getting into the market.
Ultimately both platforms are a great choice for short and intermediate-period trading but going with the one that better suits your trading experience will ease your way through the markets.
