The world of investing can be a confusing place. There are charts to analyze, strategies to compare, and a reliance on accounting principles that simply turn many people off. That may be why investing apps have become so popular recently. Apps have simplified other areas of our lives, so why not investing?
There are basically two main strategies when it comes to investing: short-term and long-term. These two main strategies have come to produce what are considered by many to be the two most popular and effective investment apps in use today: Robinhood and Stash. Today, we will be looking at some of the pros and cons of both.
With a unique title and extremely easy to use interface, this app offers plenty to catch the new investor's eye. The most appealing aspect of the Robinhood app is that it offers completely free trades. This is almost unheard of in the investment community. Usually, you would be paying a brokerage house anywhere from $4.99 to $12.99 per trade every time you bought or sold stock. Robinhood instead lets you trade for free. The way Robinhood is able to do this and still profit is that they have an ingenious system that lets them take a small percentage from every stock each time it is traded.
Another benefit of using Robinhood is that they offer no minimum to open an account. This is another advantage for the beginning investor. Most brokerages require you to have at least $500 dollars to open an account, which can be a real barrier to entry. You can open your Robinhood account with any amount of money and begin trading stocks, as long as you have enough money to purchase at least one share of the stock you are looking at.
One of the downsides of using Robinhood is that they don't give you very much information about the stocks you are looking to buy, but there are many other sites online that you can go to get your stock analysis and still profit with Robinhood.
Stash is probably the most user-friendly investment app in existence. They too offer almost no account minimum since you can get started with as little as five dollars. One disadvantage of Stash is that unlike Robinhood they don't let you invest in individual stocks. However, for a beginning investor, this can be seen as an advantage since it allows you to automatically diversify your portfolio through the large selection of index funds which Stash has to offer.
Stash lets you choose what you want to invest in based on an individualized level of risk combined with what you believe in. For example, if you are environmentally conscious and want to invest in renewable energy, you can invest in their Clean and Green Fund. If you want dividend stocks, then you can invest in Delicious Dividends. If you want to follow Warren Buffet and invest in Berkshire Hathaway then you can choose the option to Roll with Buffet.
Both of these apps provide the beginning investor with a multitude of options with no minimum to open an account. They each simplify investing in our lives in a way that only an app can do.