M1 Finance vs Robinhood | Best Free Investing App?

TL;DR

M1 Finance is ideal for long-term, portfolio-based and dividend investors while Robinhood caters to active traders wanting to trade stocks, cryptocurrencies, and options commission-free.

Transcript

• Hello once again guys. Welcome back to the channel. Hope you're having a great day so far. So in this video today, we are going to be talking about M1 Finance versus Robinhood, two of the most popular free investing platforms out there and I'm gonna be helping you guys understand what are the differences here and which one may be a better fit for... Read More

Key Insights

• 🥶 M1 Finance and Robinhood are both popular commission-free investing platforms, but they cater to different types of investors.
• 🍉 M1 Finance is ideal for long-term and portfolio-based investing, offering expert-built portfolios, fractional shares, and portfolio-level dividend reinvestment.
• ⌛ Robinhood is more suitable for active traders, providing options and cryptocurrency trading, extended trading hours, and the flexibility to trade anytime during market hours.
• ❓ M1 Finance requires a minimum amount to get started, while Robinhood has no minimum requirement.
• 🔬 Robinhood currently does not offer retirement accounts, while M1 Finance provides the option to invest through a Roth IRA.
• 🍵 M1 Finance automatically rebalances portfolios, while Robinhood requires investors to handle rebalancing on their own.
• 🎚️ M1 Finance appeals to dividend investors with its portfolio-level dividend reinvestment feature.

Questions & Answers

Q: What is the minimum amount required to get started with M1 Finance and Robinhood?

M1 Finance requires a minimum of $100 for a traditional brokerage account and $500 for a retirement account. Robinhood has no minimum requirement, allowing users to start with as little as $20.

Q: Can I trade options and cryptocurrency on M1 Finance?

No, M1 Finance does not currently offer options and cryptocurrency trading. However, Robinhood provides these trading options for users interested in these assets.

Q: Does M1 Finance provide guidance in building portfolios?

Yes, M1 Finance offers over 30 expert-built portfolios that investors can choose from, providing guidance for beginners. On the other hand, Robinhood does not offer any guidance, requiring investors to make their own investment decisions.

Q: Are fractional shares available on both M1 Finance and Robinhood?

Fractional shares are only available on M1 Finance. This feature allows investors to buy a smaller piece of expensive stocks, such as Amazon, without needing the full share price. Robinhood requires users to purchase whole shares.

Summary & Key Takeaways

• M1 Finance has a minimum amount requirement of $100 for a traditional brokerage account and $500 for a retirement account, while Robinhood has no minimum requirement.

• Robinhood offers options and cryptocurrency trading, which is not available on M1 Finance.

• M1 Finance provides over 30 expert-built portfolios and guidance, while Robinhood leaves investors to choose their own investments.

• M1 Finance offers fractional shares, portfolio-level dividend reinvestment, and automatic portfolio rebalancing, which are not available on Robinhood.