How to buy Robinhood (HOOD) shares

Robinhood is one of the best known retail trading apps. After it surfed the boom in casual trading during the pandemic, find out if now is a good time to get your hands on its stock.
By:  &  Prash Raval
Updated: Jun 13, 2022

This beginner’s guide tells you everything you need to know about Robinhood and how to get its shares. Go through a brief history of the company, how it has performed recently, and then take a look at how it might do in the future.

Where to buy Robinhood stock

The brokers below are the best places to buy Robinhood stock online. Our team of investment specialists have been through each of them with a fine-tooth comb to make sure that they offer the lowest fees and most reliable service for you.

1
Min. Deposit
$10
Promotion
User Score
10
Trade/invest in stocks with just $10
Deposit with ACA, Wire, Pay with my bank
Invest for dividends and get payout on stocks on Ex-Dividend day
Start Trading
Pros:
Trade/invest in stocks with just $10
Deposit with ACA, Wire, Pay with my bank
Invest for dividends and get payout on stocks on Ex-Dividend day
Payment Methods
Bank Transfer, Wire Transfer
Full regulations list:
CySEC, FCA
Investoo Ltd is compensated if you access certain of the products or services offered by eToro USA LLC and/or eToro USA Securities Inc., as applicable. This compensation incentivizes Investoo Ltd to describe those products and services in favorable terms. Any testimonials contained in this communication may not be representative of the experience of other eToro customers and such testimonials are not guarantees of future performance or success.
2
Min. Deposit
$0
Promotion
User Score
9.3
$0 commission and $0 Options contract fees
Upgraded research with advanced charts
Smart Menus for faster trades
Start Trading
Pros:
$0 commission and $0 Options contract fees
Upgraded research with advanced charts
Smart Menus for faster trades
Payment Methods
Full regulations list:
3
Min. Deposit
$500
Promotion
User Score
8.7
We offer one of the best execution speeds in the industry with low latency
Award-winning support in 14 languages
Trade with precision from 0.5 pips on EURUSD
Start Trading
Pros:
We offer one of the best execution speeds in the industry with low latency
Award-winning support in 14 languages
Trade with precision from 0.5 pips on EURUSD
Payment Methods
Bank Transfer, Bank Wire, Credit Card, Debit Card, PayPal, Sofort, neteller, skrill
Full regulations list:
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 68% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

How to buy Robinhood stock, a step-by-step guide

Buying shares in Robinhood is easy and anyone can do it. Below is a step-by-step guide you can follow to make your first investment.

Choose a broker and create an account

The easiest way to get started is by using an online broker. There are lots of different options to choose from and the comparison table above can help you make your decision. Once you’ve selected your broker, head over to their website and follow the steps to create an account.

Decide how much to invest

Setting a budget is key and you should never invest more than you can comfortably afford to lose. It’s a good idea to spread your money across a range of different investments so it’s not advisable to put all of your funds into Robinhood stock. HOOD is a volatile stock so you should expect some ups and downs in its price.

Research Robinhood and its potential

Before you buy Robinhood shares you should take the time to research it. You can look at things like its financial reports to help judge how well it is performing. You can find these on its investor relations website. Looking into its competitions is also a good idea and can help you determine if HOOD is the right investment for you.

Place an order for HOOD stock

Once you’ve set a budget and completed your research it’s time to place your order. This is easy and all you need to do is log into your brokerage account and search for the ticker symbol HOOD. Now you’ll be taken to its trading page where you can enter how many shares you want to buy and click the order button.

Execute your order

Once you’ve placed your order it will usually be executed immediately. Although sometimes there might be a slight delay if you place it when the market is closed. Once it’s been executed you’ll be able to monitor it in the open positions tab in your brokerage account. Here you can see its most up to date price and any profit or loss.

Review your investment regularly

Checking in on your investment at regular intervals will help you stay informed about how well its performing. For volatile new stocks like Robinhood you should expect some volatility in its price. One way to get some peace of mind is by setting a stop loss, which will automatically close your position at a set price if the market moves against you.

What is Robinhood? And should I invest?

Robinhood is an American financial services company that is headquartered in California. Founded in April 2013 by Vladimir Tenev and Baiju Bhatt, it has become one of the most popular places to invest in a diverse range of things, such as stocks, exchange-traded funds (ETFs), options, gold, and cryptocurrencies.

The company’s big advantage is its commission free model. Before Robinhood came along, investors would commonly have to pay between $5 and $10 in fees per trade, and many also needed to invest a minimum of $500 to open an account. Robinhood has turned this archetype on its head, making investing much more accessible.

Whether you want to invest in Robinhood is up to you. For brokers, going public is a well-trodden path, as is evidenced by the largest stock broker in the United States, Charles Schwab. Many feel this listing is Robinhood’s gateway to significant growth, as the capital it raises will be used to capitalise on a strong year of order-flow revenue totalling $682 million, a 514 percent increase year-on-year.

How has the company performed in recent years?

Since its IPO in 2021 its share price has only really moved in one direction – down. In July 2021 it started trading on the NASDAQ for $35 per share. Its first few days on the market were very positive and its share price more than doubled. However, those initial gains were short-lived.

Since August 2021 its share price has experienced a steady decline and in April 2022 hit its lowest level at under $10 a share. Prior to its IPO the company appeared to be in a strong position. A whole nation of ordinary people had been sitting at home during the COVID-19 pandemic and had received stimulus cheques. Many used these funds to take up investing, resulting in much of the volatility seen at the start of 2021.

As the world moved out of lockdowns and stimulus cheques stopped, so did the rush of new money pouring into the financial markets. HOOD suffered as a result and saw user numbers drop off significantly. In April 2022 it announced it was cutting its workforce by 9% to save on costs which resulted in its share price dropping below $10.

Is it a good time to buy Robinhood shares now?

It depends how much risk you’re comfortable with, as the early stages of any company’s public life can be a bumpy ride. As the market decides how much a share should be worth, the price might swing dramatically in either direction. HOOD has seen a substantial drop in its share price which may entice some speculators into thinking they’re getting a good deal.

The best way to be successful is to make sure you conduct due diligence and really drill into the company’s business model before investing any of your hard-earned capital. To avoid the biggest risks, it could also be worth waiting until the initial buzz from the listing has faded away.

As previously mentioned, retail investing has been extremely popular since COVID-19 came to the party, but the big question is whether it will continue once lockdowns cease and people have to go back to work. Will they still have time to invest or trade? This remains to be seen and is an important factor in Robinhood’s success. Use the latest news and analysis to be the first to find out if any new trends emerge.

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Ways to invest in HOOD

  • Buy Robinhood shares. The most common way to invest in Robinhood is to buy shares in the company. This means you own a piece of the business and you’re investment will rise and fall in line with its performance.
  • Invest in Robinhood ETFs. Exchange traded funds are possibly the easiest way to invest in HOOD. ETFs invest in lots of different companies and generally focus on a specific sector. If you don’t want to invest directly into HOOD, an ETF may be better.
  • Invest in Robinhood funds or trusts. Funds are similar to ETFs, although they are managed by a professional who buys and sells assets according to their experience. There are lots of funds that include Robinhood shares.
  • Trade Robinhood. If you want speculate on short term price movements in Robinhoods share price then you should consider trading it. To make the most of trading you should perform technical analysis on its price chart.
  • Spread betting. Spread betting is a way to bet on HOOD’s price rising or falling without actually owning any shares in the company. One benefit of spread betting is that all profits are free from tax.

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Invezz is a place where people can find reliable, unbiased information about finance, trading, and investing – but we do not offer financial advice and users should always carry out their own research. The assets covered on this website, including stocks, cryptocurrencies, and commodities can be highly volatile and new investors often lose money. Success in the financial markets is not guaranteed, and users should never invest more than they can afford to lose. You should consider your own personal circumstances and take the time to explore all your options before making any investment. Read our risk disclaimer >

Charlie Hancox
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Prash Raval
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