More than 13 million people use Robinhood for their investing needs, according to the latest data from the company. This is an extremely impressive figure, especially considering pretty much every broker now offers commission-free stock trading. So, what makes Robinhood appealing to its millions of customers? In this Fool Live video clip,recorded on March 29, Fool.com contributor Matt Frankel, CFP, andIndustry Focus host Jason Moser talk about why Robinhood is still attracting millions of people.
Jason Moser: I mean, all things being equal, and let's just assume that Robinhood builds itself in a point in time where commissions are $0 already. I understand why people would go to Robinhood in the very beginning because it just was easy, it was app-based, it was free trades. But let's look at it from the perspective of if everybody just had free trades. If they weren't the ones that really lit the fire to get everybody else to bring their commissions down to zero, are you going with an account with Robinhood or are you going with TD Ameritrade, if both are zero commissions?
Matt Frankel: People are still going with Robinhood and the reason is because it's easy. You hit the nail on the head there. It's because it's really easy to get money there, it's really easy to buy a stock. My neighbor across the street just started investing a few weeks ago and I had to physically walk into his house and show him how to buy a stock on TD Ameritrade because I recommended it and how to do things like look at a research report and all that. The Robinhood platform, that's one thing they really do have going for them. They make it easy. So, it's easier. A lot of younger investors like them. They are a trustworthy platform in the sense that they are insured and things like that. The high-net-worth crowd, they really haven't penetrated that market yet and there's a reason.