Robinhood is one of the most popular trading and investment platforms in the world. And it’s now available in the UK. But is it better than other low-cost investment platforms such as Trading 212 and Freetrade? Find out in our review below.

What does Robinhood UK offer?

In the US, Robinhood offers its customers a wide range of features including commission-free trading, fractional shares, crypto trading, prediction markets, options and futures trading, AI-powered stock analysis, social trading, private markets access, a credit card, wealth management and retirement services, and more. Sadly, in the UK, not all of these features are available.

Yet there are still plenty of features on offer, especially when you consider that Robinhood is a low-cost broker. Current features available to UK investors include:

• Commission-free US stock trading – You can buy US shares with no commissions (there are over 4,000 US stocks available).
• Fractional shares – You can buy fractions of shares.
• Options trading – You can trade stock and index options for just $0.50 per contract.
• Margin investing – With margin investing, you can increase your buying power by borrowing against your portfolio. Margin rates start at 5.25%.
• Stock lending – You can lend out your stocks and earn daily interest.
• Interest on uninvested cash – At the time of this review, Robinhood was paying 3.6% on cash.
• Access to crypto-assets – You can trade Bitcoin and other digital assets through Bitstamp.
• An advanced desktop platform (Robinhood Legend).

It’s worth noting here that Robinhood UK does not offer access to UK or European stocks at the moment. This is a major drawback to the platform.

 Is Robinhood safe for UK investors?

The Robinhood UK platform itself can be considered relatively safe as it is authorised and regulated by the Financial Conduct Authority (FCA) in the UK. However, there are important things to know from a safety perspective:

• Your brokerage cash and securities will be held by its affiliate Robinhood Securities (and not by a traditional custodian).
• Its crypto subsidiary Bitstamp UK Ltd is registered with the FCA as a cryptoasset firm under the Money Laundering Regulations and cryptocurrency held through Bitstamp UK Ltd is not protected by the Financial Services Compensation Scheme (FSCS).
• All cash held in a Robinhood Stocks and Shares ISA will be held in GBP by Quai Investments Services Limited (Quai) in a client money account. This cash is protected under the FSCS.
• If Quai were to be declared in default, the FSCS currently provides protection of up to £85,000 per person. In addition, if any of the UK banks used for holding your ISA cash is declared in default, deposit protection of up to £120,000 per person, per bank may apply for losses across all your deposits with that bank.
• The FSCS does not apply to the cash in a standard investment account.

It’s also worth pointing out that many of the activities that Robinhood offers, such as options investing and crypto investing, are high-risk in nature. With these kinds of activities, it’s possible to lose a lot of money.

What are Robinhood UK’s fees?

Robinhood’s fee structure is very attractive. For a start, there are no fees to trade US stocks meaning that you can make small trades here and there without having to worry about fees eating into your returns.

Second, FX fees are just 0.1% during market hours (and 0.30% on weekends and US bank holidays). Those FX rates are miles below the FX rates offered by the likes of Hargreaves Lansdown (0.99% for trades under £10,000) and Interactive Investor (0.75% on the Core plan).

Third, there are no account fees on Stocks and Shares ISAs and General Investment Accounts.

Robinhood versus Trading 212

Compared to Trading 212, Robinhood is better in some ways and worse in others.

One area it beats Trading 212 in is access to sophisticated trading strategies. For example, with Robinhood, you have access to:

• Options trading
• Crypto trading
• Margin trading

Where Trading 212 has an edge over Robinhood is in areas such as:

• Investment offering – Through Trading 212 you can invest in UK shares, European shares, US shares, and ETFs.
• Account selection – With Trading 212 you can access a Stocks and Shares ISA and a SIPP.
• Pies – Trading 212 offers access to custom pies, model pies, and social pies.

In terms of fees, Trading 212 offers zero-commission trading with FX fees of 0.15%. Robinhood also offers zero-commission trading, but its standard FX fee is 0.10%.

Robinhood versus Freetrade

Where Robinhood has an edge over Freetrade is that it offers significantly lower FX fees for US stock trades. Its FX fee is just 0.10% versus 0.39% to 0.99% for Freetrade.

It also offers zero account fees on its Stocks and Shares ISA. At Freetrade, fees depend on your subscription tier (Basic (£0), Standard (£5.99/mo), Plus (£11.99/mo)).

Where Freetrade wins, however, is in areas such as:

• Investment offering – With Freetrade you can access UK, US, European stocks, ETFs, trusts, and UK Gilts (more than 8,000 investments in total).
• Account offering – Freetrade offers access to a General Investment Account, a Stocks and Shares ISA, a SIPP, and a Junior ISA.

Is the Robinhood platform and app any good?

If there’s one major weakness in the Robinhood offering, it’s the app. In my view, it’s far too simplistic.

I like to be able to see a table showing all my stock holdings, with daily price movements, and profit and loss. However, with the Robinhood app, this doesn’t seem to be possible – when looking at your holdings you can choose to view either last price, your equity, today’s return, or total return.

Also, when you click on your Stocks and Shares ISA, the main thing you see is a chart showing the value of your ISA over time. That’s not really very helpful, in my view.

If you log into the desktop platform, it is possible to see a table with your holdings. However, finding it is difficult – you have to click on your account and then go to Investing.

Overall, I don’t think the design of the Robinhood desktop platform is very good. Finding the information you’re looking for can be a little challenging.

That said, making a trade on Robinhood is fairly easy. Whether you’re using the app or the desktop platform, it’s not hard to buy shares.

As for the platform for advanced traders, Robinhood Legend, it’s essentially just an advanced chart platform. With this platform you can analyse charts in more detail.

Research and added value

On the Robinhood website, there is an educational section called Learn. This has guides on how to invest.

The website also has links to financial news and third-party research articles. However, there is no research provided by Robinhood itself.

One other thing worth highlighting is its ‘Trending lists.’ These can be a source of investment ideas.

Customer service

If you need help with Robinhood, you can contact customer service versus a support chat feature. This uses AI to help you find answers.

You can also request a call. Note that you can contact the company 24/7.