When it comes to investing in the stock market, one of the very first steps is choosing a brokerage to invest with. In the past, there were not many options and the services were all quite similar. Today, there are dozens of choices available all with very unique offerings. It is easy to become overwhelmed when researching different investing apps.
Rest assured, our goal is to make that process a lot easier. Here’s an overview of two investing apps that are very popular among millennial investors.
Robinhood vs Acorns are revolutionizing the way the world thinks about investing. While both are unique and different in their own ways, they both strive to achieve one common goal. That is, to break down the barriers of entry to the market by offering cheap and efficient services.
Robinhood vs Acorns: The Basics
Robinhood is a commission free stock trading app that allows you to trade stocks, ETFs, options and crypto. It is geared towards beginners who want to invest in the simplest way possible. The brokerage is intentionally basic with a fantastic user interface.
Acorns is designed to make investing as easy as possible with the spare change round up model, however they do charge a fee. It’s going to cost you from $1 to $5 a month to invest with them. Instead of buying individual stocks, your money is invested in 1 of 5 prebuilt portfolios.
Right off the bat, Acorns and Robinhood have very different investing models. Choosing between the two largely comes down to whether you want to follow an active investing strategy or a more passive one.
Acorns vs Robinhood: Summary
• Both services offer low-cost ways for individuals to invest their money.
• Robinhood is 100% commission free with no monthly subscription cost (except for Gold).
• Acorns charges anywhere from $1 to $3 per month.
• Robinhood is made for the individual looking to choose their investments.
• Acorns is made for the hands-off investor that wants to stay diversified in all industries and profit off of overall market performance.
• With Acorns, you can only invest in 1 of 5 portfolios. No individual stocks.
• Acorns offers their services for a fee, but clients should expect this due to the service of automation such as automatic reinvestment of round-ups.
• Robinhood Gold offers research and margin, but costs $5 per month.
• Both offer easy to use application-based services that are beginner-friendly.
• Overall, it comes down to personal preference as to which brokerage service will fit for you.
• Robinhood is geared towards beginner investors who want to pick and choose their investments.
• Acorns is for those who are bad at saving money and investing, who do not want to choose investments on their own.