Robinhood Stock Trading Review – Scam or Legit?

Robinhood Financial offers stock trading services without charging the users commissions or fees. It allows everyone to invest in the stock market at no cost.

But is Robinhood Stock Trading a scam? In order to give you an answer, I have conducted some in-depth research on this financial company.

Since stock trading is too risky and can’t provide you with a steady passive income, at the end of this article, I’ll tell you another side hustle that can generate a stable passive income at zero risk.

Below is what I will cover in the review of Robinhood Stock Trading.

What is Robinhood Stock Trading About?

Robinhood stock trading is a financial service provided by Robinhood Financial, which is regulated and supervised by the Securities and Exchange Commission (SEC).
Is Robinhood Stock Trading a Scam? [Review 2020]

Robinhood Financial is a member of the Financial Industry Regulatory Agency (FINRA). According to FINRA’s website, the agency is “an independent, not-for-profit organization authorized by Congress to protect America’s investors by making sure the securities industry operates fairly and honestly.”

As a member of FINRA, Robinhood is subject to the scrutiny of FINRA and must comply with FINRA’s rules to promote market transparency and investor education.

In this respect, Robinhood is a safe and legitimate brokerage in the US.

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Is Robinhood Stock Trading a Scam?

Most compliant-oriented websites show that Robinhood Financial has a good reputation with individual investors.

The investor accounts of Robinhood are insured by the Securities Investor Protection Corporation (SIPC) up to $500,000 per account. In another word, if Robinhood was to go bankrupt, SIPC guarantees each account up to that limit.

But SIPC doesn’t guarantee any investment will make a positive return. As an investor, you still have to bear the risk of any stock trading activities.

In conclusion, all the regulations and practices that Robinhood participates in means that this company abides by the rules of the market and is far from being a scam.

Robinhood Financial Pricing

Robinhood charges no commissions or fees on any trade made through its trading platform. It allows users to start trading without any requirement on minimum balance. Anyone can ease their way into trading with a very low entry barrier.

How Does Robinhood Make Money?

Since Robinhood is free to sign up and doesn’t charge a trade commission, you may wonder how they make money. Below are some of the ways Robhinhood generates profits.

  • Robinhood charges amounts for domestic and international wire transfers. As a user of Robinhood, it costs you $75 to transfer your portfolio to another stock broker.
  • It offers a Gold subscription service for $5 dollars a month, which enables you to get access to margin and information about the service.
  • Robinhood reinvest the cash of customers in interest-bearing bank accounts.
  • It sells the trades of customers to high frequency firms which generated around $69M in order routing revenue.

The Problems with Robinhood

As mentioned earlier, Robinhood is not a scam. The problem is that it paints the world of investing by targeting novices and amateurs who are not familiar with stock trading.

Moreover, it doesn’t allow users to trade with mutual funds or ETFs which are generally safer than individual stocks and cryptocurrency.

The record on BBB (Business Bureau) shows that Robinhood Financial has a “B” rating. It received 276 complaints over the past 3 years on the website. The BBB page lists 22 negative reviews and 2 positive reviews on Robinhood.

Is There an Easier and Better Alternative to Make Passive Income?

Although investing is one of the most popular ways to grow your wealth and give you some passive income, the stock is unpredictable.

Even if you have the tips or insights from the so-called experts, it doesn’t guarantee you will win in the stock market. Only God knows when the stock price will rise or plunge. You may be able to make some money in a few attempts, but lose it all in the other attempts.

So if you really want to make a stable and secure stream of passive income, I would suggest you starting an affiliate marketing business online instead.

Affiliate Marketing is perfect for anyone who is new to online business.

In fact, of all the online business models I’ve tried, affiliate marketing is the easiest and most rewarding so far.

In affiliate marketing, you can actually run your business almost with zero cost and achieve a steady and sustainable passive income to pay for your bills. You don’t need any initial capital and can even do it as a side hustle.

And if you really want to learn affiliate marketing and build a business from scratch, I’d recommend you to get started with the most reputable platform for affiliate marketing: Wealthy Affiliate.

Wealthy Affiliate is an all-in-one platform for building your affiliate marketing business from scratch. It offers you a free account (including a free website) with comprehensive training on SEO (free traffic methods), which enables you to get started with affiliate marketing right away without paying a penny.

But How Much Can You Earn with Wealthy Affiliate?

A 21-year old student from Wealthy Affiliate was able to earn $7,395 in just 1 week, which means he made more than $1k a day…all while using free traffic methods.

Is Robinhood Stock Trading a Scam

Wealthy Affiliate has existed for 15  years and there are many success stories in the past decade.

To give you more examples, here are some of the other inspiring success stories of Wealthy Affiliate members.

Where to Join Wealthy Affiliate?

Wealthy Affiliate has a very simple pricing scheme. It has free and premium membership.

If you want to feel about Wealthy Affiliate, you can sign up for the free starter membership here (no credit card required). You can select to be a free member with no time limit.

And as a starter member, you can get instant access to the community, live chat, over 500 training modules, 2 classrooms, networking, commenting, 1 free website, access to the keyword tool.

You can enjoy all these values without paying a penny.

So I strongly recommend you to register a free account and see it yourself.

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