E*Trade versus Robinhood - compare IRA, commissions, investing fees, trading tools, account differences, pros and cons. Which online broker is better?

Overview of E*Trade and Robinhood

Robinhood was first to offer $0 equity commissions. But now E*Trade has followed suit. So which broker do we recommend these days? To answer that question, we need to do some digging.

Cost

Robinhood Review Etrade Review
Rating 3-star brokerage firm rating Etrade brokerage firm rating
Stocks, ETFs $0 $0
Options (per contract) $0.00 $0.65
Mutual Funds NA $19.95
Initial Funding Requirement $0 $0
Inactivity Fee $0 $0
IRA Annual Fee NA $0
IRA Termination Fee NA $0
Outgoing Wire Fees (Domestic)$25$25
Full Account Transfer Out$75$75
Partial Account Transfer Out$0$25
Open an account Open account and get one free $2-$8 value stock. No commissions on stocks and ETFs.


As you see from the table above, Robinhood and E*Trade are similarly priced.


Up Second: Securities Selection

Robinhood started with stocks, ETFs, and closed-end funds. Then it added option contracts, and finally cryptocurrency trading. That’s as far as the broker-dealer has gone at this point.

E*Trade doesn’t offer cryptocurrency trading (yet); but it does offer mutual funds, bonds, and futures in addition to the usual lineup of stocks, ETFs, and closed-end funds.

Both brokerage firms offer penny stocks. Robinhood provides trading in a few over-the-counter stocks, while E*Trade offers a larger selection.

The second category is awarded to E*Trade.


Next, We’ll Look at Mobile Trading

Robinhood’s app offers very basic charting. There is no horizontal viewing, and we found only 2 graph styles (line and candlestick). There are no tools to mention. The trade ticket provides market, limit, and stop orders. Regular hours and extended-plus-regular hours are the 2 duration options.


Robin Hood vs Etrade


There is a watchlist on the platform for both equities and cryptocurrencies. During our investigation, we didn’t find mobile check deposit, streaming financial news, or alerts. There is an ACH transfer tool, and recurring deposits can be established.

Over at E*Trade, there are actually 2 apps. The older app provides live streaming of Bloomberg in high definition. Charting on the app comes with horizontal mode and tools. The order form incorporates several duration options, including fill or kill, good for 60 days, and immediate or cancel. Alerts, check deposit, and a watchlist also make an appearance.


Etrade vs Robin Hood


The second app provides futures trading and a sophisticated order ticket. Strangely, charting isn’t available in horizontal mode.

E*Trade garners its second victory.


Fourth is Website Trading

Robinhood’s site has an emphasis on advertising, but there is a client login. When we got into our test account, we found a simple interface with user-friendly trading buttons. It’s basically the same as the mobile platform, except that charting is more advanced with full-screen mode and a few technical studies. The trading ticket offers the same options as the mobile system.


Robin Hood vs Etrade


On the website trading platform, there is a watchlist for stocks and another for cryptos. Missing are alerts, video news, complex order types.

And how does E*Trade compare? First off, its website has a lot more material on it. The order ticket has more features, including a calculator that can convert a $ amount to # of shares. It also provides more order types and duration choices. A customer service section provides many self-help features that aren’t available on the Robinhood platform. Plus, charting on the site is far more advanced than anything Robinhood offers.


Etrade or Robinhood


A second area in this category where E*Trade really impressed us was with its browser platform Power E*Trade. This software is launched into a separate window from the account home page. It offers a very advanced order ticket with many order types, such as OCO stop, 3 leg bracket stop limit, and quote trigger. Duration options include good-until-a-certain-date. Charting is excellent, and perhaps best of all, there is a simulated trading mode for extra practice.

Another defeat for Robinhood.


Fifth is Desktop Trading

Besides Power, E*Trade offers a desktop trading environment aptly called Pro. It definitely has a professional feel to it as we found it somewhat difficult to learn. But it does offer a lot of great features, such as direct access to market venues and Level II quotes. Charting and pretty much everything else are on an advanced level; yet the software manages to be easy to navigate, thanks to large tool icons.


Etrade or Robin Hood


Robinhood has no desktop platform and so loses the fourth category.


Sixth is Funds

As mentioned in the first category, only E*Trade offers mutual funds. So obviously, it defeats its rival there. But what about exchange-traded funds? Here, we need to do a little research.

Robinhood’s platform provides security data on ETFs, such as dividend yield, and 52-week range. From an ETF’s profile page, it’s easy to add a fund to a watchlist or look at available options.

E*Trade customers have access to an All-Star List, which is composed of ETFs selected by the broker’s financial advisors. Fund profiles include links to pdf reports from Morningstar and E*Trade. Furthermore, a fund’s prospectus is linked on the fund’s profile. E*Trade also presents an ETF’s portfolio, including not just holdings but also regional exposure. Robinhood doesn’t do this.

E*Trade again.


Seventh is Education & Research

E*Trade customers have access to a large assortment of research and learning materials. The broker-dealer has a collection of screeners that we found effective and easy to use. Articles and videos describe basic trading topics, such as the difference between calls and puts. And security profile pages include a moderate amount of data, including free stock reports.

Robinhood’s ETF and stock screener only offers a few search variables. There are no stock reports, paid or free; and the brokerage firm does not provide much in terms of learning materials.

E*Trade adds another trophy to its shelf.


Eighth is Options

In the not-so-distant past, Robinhood didn’t offer options. Then it added calls and puts. Now, the company has multi-leg strategies integrated into its mobile app. We found debit call spreads, put credit spreads, straddles, strangles, and iron condors. Despite this advancement, the strategies strangely are absent on the web platform (it’s possible to create your own multi-leg plays).

On E*Trade’s PC platforms, we found spreads, butterflies, condors, iron butterflies, condors, diagonals, calendars, verticals, straddles, strangles, and iron condors. Its mobile app has many of the same strategies.

E*Trade wins again.


Finally, Other Services

E*Trade offers DRIP service, IRAs, and automatic investing in mutual funds. Robinhood offers none of these.

Robinhood has been promising for some time to provide cash management tools, but it apparently doesn’t have the business acumen to roll them out. Meanwhile, E*Trade still offers checking and savings accounts, which can be conveniently linked to a brokerage account.

Another defeat for Robinhood.


Our Recommendations

Mutual Fund Traders: For obvious reasons, we have to suggest E*Trade here.

Beginners: Due to E*Trade’s much better customer service and decent assortment of learning materials, new investors should pass on Robinhood.

Retirement Savers: Robinhood offers neither IRAs nor solo 401(k)s. E*Trade offers both, so it’s an easy pick.

Trading Tools: E*Trade by far.

ETF and Stock Trading: For its software, we propose E*Trade.


Promotions

E*Trade: No commissions on stocks and ETFs.

Robinhood: Open account and get one free $2-$8 value stock.



Robinhood vs E*Trade Summary

E*Trade won every single category. With its new $0 equity commission schedule, the broker is now a much better value than Robinhood.


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