Last Updated December 1, 2023

Retail Access

Robinhood believes democratizing finance for all is an unstoppable movement, and access to the markets is something policymakers on both sides of the aisle have long desired.

Key Points:

  • Robinhood pioneered the elimination of trading commissions and account minimums.
  • The rest of the industry is compelled to follow, establishing a new norm.
  • Robinhood continues to break down barriers and open doors to the markets with new products and features.

What we’ve seen

The U.S. Stock Market remains one of the greatest wealth generators in history, yet 10% of US households hold 87% of the total value of stocks (Wall Street Journal, August 21, 2020). Robinhood is out to change that. Our customers are shaking up an industry long reserved for the 1%.

In recent years, tens of millions of first-time investors have entered the markets. Many of them are Robinhood customers who, according to our survey data*, are more racially diverse than customers at incumbent brokerages.

Our approachable, low-cost platform, paired with our digestible educational content, is a central reason why millions of new investors of all backgrounds and socio-economic status are participating in the markets today.

What we’re doing

Guided by our mission to democratize finance for all, we’ve eliminated historical barriers and unlocked retail access to the markets for everyday investors. We pride ourselves on being among the first to:

  1. Eliminate Commissions and Account Minimums.

    Robinhood was the first U.S. retail broker to fully and successfully eliminate commissions and account minimums for investors. This disruption shook the industry, pushing even incumbent retail brokers to do the same, saving investors billions and counting. Today, U.S. customers can open an account and start their portfolios with as little as $1.

  2. Introduce fractional share trading.

    Some of the most actively traded stocks have share prices in excess of $100. We introduced fractional shares in 2019, opening up the ability for investors to invest in high-priced stocks and ETFs with as little as $1.

  3. Give everyday investors access to IPOs.

    For years, participating in Initial Public Offerings (IPOs) was exclusively reserved for institutional and high-net-worth investors. In staying true to our commitment to everyday investors, we changed that by opening up access to IPOs in 2021, including our own.

  4. Allow customers to build their saving habits and invest in their future.

    We rolled out recurring investments in 2020. Available to investors at all levels, this feature offers a wide range of benefits—whether you’re just getting started and looking to build responsible investing habits or working toward long-term investing goals. Saving is a habit and recurring investments employ a strategy to build over time while potentially reducing the impact of market volatility.

  5. Introduce an IRA match with no traditional employer necessary.

    In December 2022 we launched Robinhood Retirement, allowing customers to invest for their future the Robinhood way – no employer necessary. All while earning a match from Robinhood on every eligible contribution dollar. Other fees may apply.

The takeaway

It’s clear that our customers are upending an industry long reserved for the 1%. For more on how they’re interacting with the market,  take a look at the Robinhood Investor Index, a monthly aggregate view of the top 100 most owned investments on the platform.

We look to support policies that increase retail investor participation and hold the door open to the markets for those who for too long have been kept out.

*Data comes from a monthly Robinhood survey, powered by Dynata. Sample is representative of the U.S. population with brokerage accounts across age, gender, income, race/ethnicity, and regional residence. Incumbent firms include: Charles Schwab, E*Trade, Fidelity, TD Ameritrade, Vanguard.

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Resources

On the Benefits of New Retail Investors in our Markets

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GameStop and the Reemergence of the Retail Investor

Jill E. Fisch, Institute for Law and Economics; 2022

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This Time is Different: Investing Preferences in the Age of Robinhood

Valeria Fedyk, London Business School; 2021

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The rise of newly empowered retail investors

Deloitte, Deloitte Center for Financial Services; 2021

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Four ways retail investors can take control of their financial future

Meagan Adrews and Sofia Eckrich, World Economic Forumn; 2022

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Bridging the Divide: A Closer Look at Changes in the Racial and Ethnic Composition of Investor Households

Olivia Valdes and Gary Mottola, Finra Investor Education Foundation; 2021

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Gender, Generation and Financial Knowledge: A Six-Year Perspective

Gary Mottola, Finra Investor Education Foundation; 2018

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Stock Investors Are Younger and More Racially Diverse

Aaron Brown, Bloomberg, 2020

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Robinhood CEO: Becoming an investor is the new American dream, just like home ownership was before

Vlad Tenev, CNBC; 2021

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Comment on Supporting Diversity and Inclusion in the Broker-Dealer Industry (Regulatory Notice 21-17)

Norman Ashkenas and Kelly Zigatis, Robinhood; 2021

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