Robinhood launches desktop platform, adds futures and options trading to app Via Reuters
Written by Manya Saini and Niket Nishant
(Reuters) – Robinhood (NASDAQ: ) launched its long-awaited desktop platform and added futures trading features and index options to its mobile app on Wednesday, as the fintech company aims to take market share from traditional brokerages.
The 11-year-old commission-free trading app, which resembled mom-and-pop investors in 2021, is now seeking to mature into a full-fledged financial services provider and compete with established brokerages that serve institutional investors.
The Menlo Park, California-based company said its desktop trading platform, called 'Robinhood Legend,' will focus on active traders.
“We have grown alongside our customers and have heard loud and clear that they want access to more advanced products and more effective trading tools,” Chief Marketing Officer Steve Quirk told Reuters.
“Our long-term goal is for Robinhood to be the premier financial services company that meets all customer needs.”
The platform, available at no additional cost, will provide advanced trading tools, real-time data, and custom and preset structures.
Meanwhile, the app will allow users to trade futures on the benchmark, oil and bitcoin, among others. Clients can also trade index options
THE WAR FOR MARKET SHARE
Long dominated by top names like Vanguard, Charles Schwab (NYSE:), and Fidelity Investments, the US brokerage industry saw its first disruption in decades when Robinhood pioneered commission-free trading in 2013.
Ten years ahead, Robinhood is expanding to cater to more experienced investors. Futures and options trading has often been the domain of large banks, hedge funds and asset managers, due to high margin requirements, increased volatility, complexity and commissions.
Subscribers to Robinhood's premium Gold tier will be able to trade futures for as little as 50 cents per contract, while non-Gold users will have to pay a commission of 75 cents.
This compares to Schwab's fees of $2.25 per contract, while Morgan Stanley's E*TRADE charges $1.50 for futures and $2.50 for crypto futures.
Robinhood's fees for index options, set at 35 cents per contract for Gold members and 50 cents for others, are also lower than industry peers.
The company had 11.8 million active users and 'gold' customers worth 1.98 million, as of June 30.
Analysts have said that Robinhood's entry into futures trading this year could be met with some caution by retail traders if it charges fees, but could also create new opportunities to expand its market share.
Earlier this year, the company committed to expanding margins while focusing on driving “profitable growth” through 2024. Three consecutive quarters of reported earnings have also bolstered investor enthusiasm, contributing to the stock's year-to-date gain of more than 100%.
