Robinhood launched its long-awaited desktop platform and added futures and index choices buying and selling options to its cell app on Wednesday, because the fintech agency goals to take market share from conventional brokerages.

The 11-year-old commission-free buying and selling app, which grew to become synonymous with mom-and-pop buyers in 2021, is now looking for to mature right into a full-fledged monetary providers supplier and compete with established brokerages that serve institutional buyers.

The Menlo Park, California-based firm stated its desktop buying and selling platform, dubbed ‘Robinhood Legend,’ will concentrate on energetic merchants.

“We have matured alongside our prospects and have heard loud and clear that they need entry to extra superior merchandise and extra energetic buying and selling instruments,” Chief Brokerage Officer Steve Quirk informed Reuters.

“Our long-term objective is for Robinhood to be the first monetary providers firm that meets all of consumers’ wants.”

The platform, out there at no further price, will provide superior buying and selling instruments, real-time knowledge, in addition to customized and preset layouts.

In the meantime, the app will permit customers to commerce futures on the benchmark S&P 500 index, oil and bitcoin, amongst others. Clients may commerce index choices

Battle for Market Share

Lengthy dominated by high-profile names like Vanguard, Charles Schwab, and Constancy Investments, the US brokerage trade noticed its first disruption in a long time when Robinhood pioneered commission-free buying and selling in 2013.

A decade on, Robinhood is increasing to cater to extra seasoned buyers. Buying and selling in futures and choices has usually been the area of huge banks, hedge funds and asset managers, as a result of larger margin necessities, elevated volatility, complexity and commissions.

Subscribers to Robinhood’s premium Gold tier will have the ability to commerce futures for as little as 50 cents per contract, whereas non-Gold customers might want to pay a fee of 75 cents.

This compares with Schwab’s expenses of $2.25 (roughly Rs. 190) per contract, whereas Morgan Stanley’s E*TRADE takes $1.50 (roughly Rs. 126) for futures and $2.50 (roughly Rs. 210) for crypto futures.

Robinhood’s charges for index choices, set at 35 cents per contract for Gold members and 50 cents for others, can also be decrease than trade friends.

The corporate had 11.8 million month-to-month energetic customers and 1.98 million premium ‘Gold’ prospects, as of June 30.

Analysts have beforehand stated Robinhood’s entry into futures buying and selling this yr could possibly be met with some warning by retail merchants if it expenses a charge, however it may additionally create new alternatives for increasing its market share.

Earlier this yr, the corporate had dedicated to increasing margins whereas specializing in driving “worthwhile progress” in 2024. Three consecutive quarters of reported earnings have additionally bolstered investor enthusiasm, contributing to a year-to-date inventory acquire of over one hundred pc. 

© Thomson Reuters 2024

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