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10 Best Investment Apps of 2020

At NerdWallet, we strive to help you make financial decisions with confidence. To do this, many or all of the products featured here are from our partners. However, this doesn’t influence our evaluations. Our opinions are our own.

You can do just about anything on your phone — including invest, thanks to a variety of investment and stock trading apps.

All of the brokers on our list of best brokers for stock trading have high-quality apps. But if mobile trading is most important to you, these 10 investing apps are NerdWallet’s picks for the best of 2020. (Need more info to get started? Read our primer on how to buy stocks.)

on TD Ameritrade’s website

TD Ameritrade

cash credit with qualifying deposit

on TD Ameritrade’s website

cash credit with qualifying deposit

Commission-free stock, ETF and options trades.

High-quality trading platforms.

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No account minimum.

Good customer support.

Large investment selection.

Costly broker-assisted trades.

on Robinhood’s website

Robinhood

no promotion available at this time

on Robinhood’s website

no promotion available at this time

No account minimum.

No retirement accounts.

No mutual funds or bonds.

Limited customer support.

on Stash Invest’s website

Stash Invest

cash credit to invest with qualifying deposit

on Stash Invest’s website

cash credit to invest with qualifying deposit

Educational content and support.

Values-based investment offerings.

No investment management.

High ETF expense ratios.

on Acorns’s website

Acorns

no promotion at this time

on Acorns’s website

no promotion at this time

Automatically invests spare change.

Cash back at select retailers.

Educational content available.

Small investment portfolio.

High fee on small account balances.

Want to compare more options? Here are our other top picks:

Summary of Best Investment Apps of 2020

on E*TRADE’s website

cash credit with a qualifying deposit or transfer

on E*TRADE’s website

on TD Ameritrade’s website

cash credit with qualifying deposit

on TD Ameritrade’s website

on Robinhood’s website

no promotion available at this time

on Robinhood’s website

on Stash Invest’s website

cash credit to invest with qualifying deposit

on Stash Invest’s website

on Acorns’s website

no promotion at this time

on Acorns’s website

SoFi Active Investing

on SoFi Invest’s website

career counseling plus loan discounts with qualifying deposit

on SoFi Invest’s website

cash credit with qualifying deposit

in cash bonus with qualifying deposit.

No promotion at this time

No promotion available at this time

Brokerage app FAQs

How much money do I need to get started?

Shockingly little. Thanks to micro-investing apps like Acorns and Stash, you can kick-start an investment portfolio with small amounts of money — just your spare change, in fact. Acorns, for example, sweeps a linked credit or debit card account, rounds up purchases to the nearest dollar and invests the change. Stash offers a similar opt-in feature that rounds up purchases to deposit money in a user’s account.

Beyond the micro-investing apps, the amount of money you’ll need to begin investing after you open your account depends on the assets you intend to buy. Individual stock shares range from as little as a few dollars to hundreds or even thousands of dollars per share. Mutual funds often have minimums of $1,000 or more, but exchange-traded funds (ETFs) are essentially mutual funds that trade like a stock, and they can often be purchased for less than many mutual funds. Don’t forget, too, that some brokers charge trading fees every time you buy or sell an investment. The good news there is that many brokers now offer free trades.

Many of NerdWallet’s picks for best apps have account minimums of $5 or less, so you can open an account right away and over the internet. Here’s more on what a brokerage account is and how to open one.

Which investment app is best for stock traders?

In the summary table above we’ve categorized our best investing apps based in part on price (trading costs and account fees), mobile platform features and account minimums.

What is the best investment app for beginners?

For new investors just learning the ropes, Acorns and Stash are worthy contenders for your first investing dollars. One reason is that their services focus on ETFs instead of just individual stocks, although Stash also offers about 150 stocks.

While the idea of buying individual stocks might be exciting, building a portfolio of stocks requires a fair amount of research and discipline. ETFs offer instant diversification in that they contain shares of multiple companies (dozens, even) like a mutual fund, but trade like individual stocks. (Check out this full explainer on ETFs.)

Although all the other brokers allow investing in ETFs through their apps, Acorns takes a different approach by steering investors towards pre-built portfolios that contain multiple ETFs, diversifying your investment dollars across a collection of stocks and bonds. Portfolios are based on your tolerance for risk — based on your age, goals and time horizon — and automatically rebalanced when the stock market fluctuates. Acorns uses a handful of ETF portfolios that range from aggressive to conservative. Stash doesn’t offer pre-built portfolios but helps investors choose specific ETFs based on themes (e.g., “Clean and Green” is an ETF that holds environmentally responsible companies).

If buying individual shares of companies is something you’d like to do, see our guide on How to Buy Stocks.

What assets can I trade on these apps?

The mobile trading experience varies by broker — and so do the range of available assets. Among the picks for best apps, Acorns offers only ETFs, while TD Ameritrade’s offerings include individual stocks, mutual funds, ETFs, bonds, options and currency (or forex).

Is my money insured?

Just as FDIC insurance insures bank accounts, SIPC insurance insures the money you have in your brokerage account (or robo-advisor account) up to $500,000. $250,000 of that total can be applied to protect cash that you haven’t yet invested. All of NerdWallet’s picks for best apps are members of the SIPC.

However, it’s important to note that investments you make in your account can potentially fall in value or even decrease to zero, and investment losses are not covered by any type of insurance. (Here’s more on SIPC insurance and what it does and doesn’t protect.)

Robinhood Review

Robinhood’s fees no longer set it apart

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  • Account Minimum: $0
  • Fees: $0

Robinhood’s claim to fame is that they do not charge commissions for stock, options, or cryptocurrency trading. Due to industry-wide changes, however, they’re no longer the only free game in town. The firm’s target customer base is young people new to investing, who are drawn to the app by advertising that leans heavily on words such as “free” and “democratization.” By and large, this tactic has succeeded, drawing in 10 million customers. But what happens to them when they outgrow Robinhood’s meager research capabilities or get frustrated by outages during market surges?

Important

During the sharp market decline, heightened volatility, and trading activity surges that took place in late February and early March 2020, Robinhood experienced extensive outages that affected its users’ ability to access the platform at all, leading to a number of lawsuits. However, Robinhood’s customer agreement, a multi-page document most customers electronically sign without reading, is intended to legally absolve the firm of any responsibility for these outages.

We’ll look at Robinhood and how it stacks up to more established rivals now that its edge in price has all but evaporated.

Key Takeaways

  • Robinhood’s low fees and zero balance requirement to open an account are attractive for new investors.
  • Customers must pay at least $5 per month for Robinhood Gold in order to trade on margin, view market depth data, and access research, such as Morningstar reports on high-volume stocks. Robinhood customers can try the Gold service out for 30 days for free.
  • Robinhood does not publish their trading statistics the way all other brokers do, so it’s hard to compare their payment for order flow statistics to anyone else. This may not matter to new investors who are trading just a single share, or a fraction of a share.

Who Robinhood Is For

Robinhood is best suited for newcomers to investing who want to trade small quantities and require little in terms of research beyond seeing what others are trading. Robinhood’s overall simplicity makes the app and website very easy to use, and charging zero commissions appeals to extremely cost-conscious investors who trade small quantities. That said, the offerings are very light on research and analysis, and there are serious questions about the quality of the trade executions.

Trading costs are very low and cryptocurrency trades can be placed in small quantities

Very simple and easy to use

Customers have instant access to deposited cash

Trades appear to be routed to generate payment for order flow, not best price

Quotes do not stream, and are a bit delayed

There is very little research or resources available

Pros Explained

  • Robinhood allows cryptocurrency trades to be placed in very small quantities. Most other cryptocurrency-friendly platforms require certain minimums in order to trade.
  • Robinhood’s mobile app and the website are extremely easy to use.
  • Robinhood is very efficient at getting your cash into the market. All customers have instant access to deposits and immediate access to funds after closing positions, and your buying power is increased as soon as you initiate a deposit into your account.

Cons Explained

  • There is no commission charged by Robinhood for trades, but the spread we saw for our cryptocurrency transactions was considerably wider than those we saw on other platforms.
  • Though prices update on the Robinhood app and the website, they lag other real-time data providers by several seconds.
  • New investors who are dedicated to improving their trading skills will outgrow the resources provided by Robinhood, especially options traders.

Usability

Robinhood is very easy to navigate and use, but this is related to its overall simplicity. Robinhood’s initial offering was a mobile app, followed by a website launch in Nov. 2020. As a result, Robinhood’s app and the website are similar in look and feel, which makes it easy to invest through either interface. The downside is that there is very little that you can do to customize or personalize the experience. Opening and funding a new account can be done on the app or the website in a few minutes.

The opening screen when you log in is a line chart that shows your portfolio value, but it lacks descriptions on either the X- or Y-axis. You can hover your mouse over the chart, or tap a spot if you’re on your mobile device, to see the time of day for each data point.

An order ticket pops open whenever you are looking at a particular stock, option, or crypto coin. All the asset classes available for your account can be traded on the mobile app as well as the website, and watchlists are identical across platforms. Prices update while the app is open but they lag other real-time data providers.

The mobile apps and website suffered serious outages during market surges of late February and early March 2020. The founders said in a blog post that their systems could not handle the stress of the “unprecedented load” and pledged to beef up their systems. 

Trade Experience

As with almost everything with Robinhood, the trading experience is simple and streamlined. Robinhood deals with a subsection of equities rather than the entirety of the market, but on every quote screen for the stocks and ETFs you can trade on Robinhood, there is a straightforward trade ticket. All the asset classes available for your account can be traded on the mobile app as well as the website, and watchlists are identical across the platforms.

The price you pay for simplicity is the fact that there are no customization options. If you want to enter a limit order, you’ll have to override the market order default in the trade ticket. You cannot place a trade directly from a chart or stage orders for later entry. Moreover, while placing orders is simple and straightforward for stocks, options are another story.

Placing options trades is clunky, complicated, and counterintuitive. Although Robinhood allows options trading, the platform seems geared entirely towards making market orders for assets rather than actually attempting to strategically use options to profit. This perception is reinforced by the fact that pricing refreshes every few seconds, but the actual pricing data lagged behind two other platforms we opened simultaneously by 3–10 seconds. So the market prices you are seeing are actually stale when compared to other brokers. This will not faze anyone looking to buy and hold a stock, but this data lag kills any idea of using Robinhood as a trading platform.

Range of Offerings

Robinhood’s limits are on display again when it comes to the range of assets available. Robinhood allows you to trade cryptocurrencies in the same account that you use for equities and options, which is unique, but it’s missing quite a few asset classes, such as fixed income. Investors using Robinhood can invest in the following:

  • Stocks: Long only. No short selling. No OTCBB (penny stocks).
  • Simple and multi-leg options.
  • Cryptocurrency: Bitcoin (BTC), Bitcoin Cash (BCH), Bitcoin SV (BSV), Dogecoin (DOGE), Ethereum (ETH), Ethereum Classic (ETC), Litecoin (LTC). Data is additionally available for ten other coins.
  • No mutual funds, fixed income, futures, or futures options.
  • Fractional share investing has been announced but not currently available to all customers.

Order Types

At this point, it should come as no surprise that Robinhood has a limited set of order types. You can enter market or limit orders for all available assets. You cannot enter conditional orders. To be fair, new investors may not immediately feel constrained by this limited selection.

Trading Technology

Robinhood does not publish its trading statistics the way all other brokers do, so it’s hard to compare its payment for order flow statistics to anyone else. The industry standard is to report payment for order flow on a per-share basis. Robinhood reports on a per-dollar basis instead, claiming that it more accurately represents the arrangements it has made with market makers. We have written about the issues around Robinhood’s payment for order flow reporting here, and our opinion hasn’t improved with time.

The way a broker routes your order determines whether you are likely to receive the best possible price at the time your trade is placed. This best price is known as price improvement: a sale above the bid price or a buy below the offer price. Robinhood does not disclose its price improvement statistics, which leads us to make negative assumptions about its order routing practices. The target customer is trading in very small quantities, so price improvement may not be a huge consideration. However, other brokers who also charge $0 for equity trades are offering their customers impressive price improvement, so Robinhood needs to get serious about execution quality in order to stay competitive.

Costs

Robinhood’s trading fees are easy to describe: free. There are some other fees unrelated to trading that are listed below.

  • All equity trades (stocks and ETFs) are commission-free.
  • Options trade for $0—no per-leg fee and no per-contract fee.
  • Trading on margin requires a Robinhood Gold subscription at $5 per month, which includes $1,000 of margin. Margin usage over $1,000 is charged 5% interest, which is relatively low.
  • Account transfer fee is $75.
  • Exercise and assignment fee is $0.
  • Wire fees to send or receive: $25 for domestic wires, $50 for international. It is unusual to be charged to receive a wire.
  • Check fees: $35 to send a domestic check overnight.
  • Live broker fee is $10 per transaction, though it’s not obvious how to contact a broker.

How This Broker Makes Money From You and for You

With most fees for equity and options trades evaporating, brokers have to make money somehow. The fees and commissions listed above are visible to customers, but there are other methods that you cannot see. Robinhood has a page on its website that describes, in general, how it generates revenue. 

  • Interest on cash: Like most brokers, Robinhood generates interest income from the difference between what you are paid on your idle cash and what they can earn on customer cash balances. Robinhood clients, once they make it off the waitlist and design their own Mastercard debit card, can earn modest interest on their uninvested cash, which is swept to its network of FDIC-insured banks. On several pages of the website, the cash feature is labeled “Coming Soon.” 
  • Payment for order flow: Quite a few brokers generate income by accepting payment from market makers for directing their customer’s equity and options orders to those trading venues. This is called payment for order flow (PFOF). We discussed Robinhood’s lack of transparency around PFOF above, but it is worth repeating that this appears to be a major revenue stream for the broker.
  • Stock loan programs: Stock loan programs generate revenue for brokers when the stock held in your account is loaned to another trader or hedge fund, usually for the purposes of selling that stock short. Robinhood retains all the income it generates from loaning out customer stock and does not share it with the client.
  • Margin interest: Robinhood’s margin interest rates are lower than average, though using margin requires paying $5/month for their Gold program whether you are using margin or not.
  • Portfolio Margining: Portfolio margining, which can lower the amount of margin you may need, is not offered by Robinhood.

Account Amenities

  • Robinhood does not offer portfolio margining.
  • Robinhood does not have a stock loan program.
  • Robinhood clients can earn interest on their uninvested cash, which is swept to its network of FDIC-insured banks.
  • Cash sweeps are automatic once a client is enrolled in the program.
  • Clients cannot enroll in dividend reinvestment programs.

Research Amenities

Robinhood’s research offerings are, you guessed it, limited. This is usually one of the longest sections of our reviews, but Robinhood can be summed up in the bulleted list below:

  • There are no screeners for stocks, ETFs, or options.
  • There are no investing-related tools or calculators.
  • The trading idea generators are limited to stock groupings by sector. Once you click on a group, you can add a filter such as price range or market cap.
  • News is available from The Wall Street Journal, Reuters, and Barron’s in addition to videos from CNN Business, Cheddar, and Reuters.
  • Third-party research from Morningstar can be accessed by Robinhood Gold clients ($5/month subscription).
  • The charting is extremely rudimentary and cannot be customized.

Portfolio Analysis

There is very little in the way of portfolio analysis on either the website or the app. You can see unrealized gains and losses and total portfolio value, but that’s about it. The start screen shows a one-day graph of your portfolio value; you can click or tap a different time period at the bottom of the graph and mouse over it to see specific dates and values. There is no asset allocation analysis, internal rate of return, or way to estimate the tax impact of a planned trade. There is no trading journal.

To perform any kind of portfolio analysis, you’ll have to import your transactions into another program or website.

Education

Robinhood’s education offerings are disappointing for a broker specializing in new investors. There’s a “Learn” page that has a list of articles, displayed in chronological order from most recent to oldest, but it is not organized by topic. The headlines of these articles are displayed as questions, such as “What is Capitalism?” or “What is Inventory?”   There are no videos or webinars available, but the daily Robinhood Snacks three-minute podcast gives some market information.

Customer Service

  • All customer service is done via the app or the website.
  • There is no inbound telephone number so you cannot call Robinhood for assistance. If you work your way through an extensive menu designed to narrow down your support issue, you can enter your own phone number for a callback.
  • You can place a trade through a live broker for $10, but they are not there to offer help otherwise.

Security

Robinhood’s technical security is up to standards, but it is missing a key piece of insurance.

  • Mobile app users can log in with biometric (face or fingerprint) recognition or a custom pin.
  • Robinhood encourages users to enable two-factor authentication.
  • New logins from unrecognized devices also need to be verified with a six digit code that is sent via text message or email in case two-factor authentication is not enabled.
  • Robinhood carries no excess Securities Investor Protection Corporation (SIPC) insurance.
  • Through calendar 2020, there were no significant data breaches reported by the Identity Theft Research Center. 

Our Verdict

If you’re brand new to investing and have a small balance to start with, Robinhood could be the place to help you get used to the idea of trading. The extremely simple app and website are not at all intimidating and provide a smooth on-ramp to the investing experience, especially for those exploring stocks and ETFs. While it’s true that you pay no commissions at Robinhood, its order routing practices are opaque and potentially troubling. Robinhood also has a habit of announcing new products and services every few months, but getting them into production and available to all clients takes a long, long time.

If you’re a trader or an active investor who uses charts, screeners, and analyst research, you’re better off signing up for a broker that has those amenities. Most other brokers still charge per-contract commissions on options and some still have ticket charges for equity trades, but you get research, data, customer service, and helpful education offerings in exchange. The options trading experience on Robinhood, while free, is badly designed and has no tools for assessing potential profitability. Even if you are a new investor only interested in buying and holding stocks, there are many zero-fee brokers to choose from now. They may not all have the flashy marketing that backs up Robinhood, but they have a lot more meat to their platform and much more transparent business models.

Beware of These 5 Bitcoin Scams

Bitcoin’s meteoric rise in prices in 2020 awakened mainstream interest in the original cryptocurrency.   But the rise in interest has not been without consequences. One of the downsides of new investors entering the market is the increase in the number of scams, frauds, and stories of retail investors who lose their coins to shady ventures. From ICO scandals to wallet theft and fraud, regular consumers can fall prey to crime easily.

It may seem as though it’s the Wild West for investors, but it doesn’t have to be. While there are certainly risks in the market, the opportunities may be irresistible for some. However, being cautious is always a must, and there are clear signs of scams that investors can look for. By avoiding these traps, users can better their chances of success and protect their investments. These are some of the most common scams and how they can be avoided.

Key Takeaways

  • Bitcoin investors can increase their odds for success by identifying common scams, such as Ponzi schemes, fake ICOs, and fraudulent exchanges.
  • One common scam, exposing bitcoin users to theft, is the sale of a hardware wallet with a compromised pre-configured seed phrase, which allows hackers to steal funds.
  • Since bitcoin exchanges are unregulated, fraudulent exchanges can trap investors with the promise of unrealistic prices and heavy discounts on use.
  • Websites featuring fake ICOs instruct users to deposit funds into a compromised wallet through their site, resulting in the theft of funds.

Hardware Wallet Theft

For users who are concerned with security and privacy, a hardware wallet—a physical device that stores their private keys—is an increasingly popular option. Usually, as small as keychain USB drives, these wallets offer an offline way to help crypto investors protect their bitcoin even further. However, there have been reports that some of them have built-in vulnerabilities that open them to hackers that could easily steal all a user’s holdings. 

This is far from the only issue, however. According to Ofir Beigel, the owner of 99Bitcoins.com:

One scam entails selling hardware wallets to users with a ‘pre-configured’ seed phrase hidden under a scratch card. The new user is told that he should scratch the card . and set up the wallet with the compromised seed.

This creates a backdoor that allows hackers to drain funds once a wallet is activated. These scams are becoming more common, but they can easily be avoided by only accepting wallets from trusted sources. 

Exchange Scams

Despite their decentralized nature, most cryptocurrencies are still bought and sold at exchanges. While this makes it easier to find the coins investors desire, there is still no regulatory body overseeing these exchanges in many countries. Thus, many investors have been left penniless when the exchanges they signed up for turn out to be traps. In December of 2020, several South Korean exchanges were exposed, leading to promises of stiffer regulations by the country’s authorities. 

These scams are not hard to spot but can be costly if not avoided. One of the biggest red flags is the promise of unrealistic prices. Exchanges that promise heavy discounts on bitcoin use this strategy to lure in unsuspecting victims.

Additionally, users can check exchanges’ URLs. Web addresses should always begin with HTTPS, a sign that traffic is encrypted. Visiting unsecured websites is a bad idea, but alert investors can avoid losing thousands by looking for the right signs.

Fake ICOs

One of the best results of the cryptocurrency boom has been the rise of the initial coin offering as a way for companies to raise capital. With thousands of new blockchain-based companies entering the market with unique ideas and exciting projects, users can now back their favorite businesses easily. However, this massive explosion of ICO opportunities has inevitably raised the specter of fraud.

There are several ways scammers can separate investors from their bitcoin. One popular method involves creating fake websites that resemble ICOs and instructing users to deposit coins into a compromised wallet. Other times, it’s the ICOs that are at fault.

Centra Tech, for example, a blockchain venture backed by several celebrities, has been sued in the US. The company stands accused of portraying fake team members, misleading investors, and lying about their products.   The best way to avoid these scams is close research that involves picking apart the white paper, reviewing the team behind the venture, key board members, and investors. Before making any investment, it’s vital to learn as much about the company as possible to avoid any unpleasant surprises.

Cloud Mining Schemes

Mining is the only way to extract new bitcoins without buying or exchanging them, but it has become an incredibly resource-intensive activity. Due to the unique way new coins are mined, it takes massive amounts of processing power and electricity, and thus money, to mine a coin. However, many companies now offer regular users the ability to rent some server space to mine coins for a set rate.

Some companies offer “lifetime contracts” that keep costs the same and supposedly offer outstanding returns. However, as the difficulty of mining increases, the same investment will return smaller amounts each time. Moreover, some companies make bold claims regarding their returns without being transparent about the true costs and diminishing returns. Others operate Ponzi schemes that can lead to massive losses. It’s vital to look into opportunities and understand the risks and costs associated with mining before investing.

Multilevel Marketing

Even in the digital spheres, many multilevel marketing schemes have emerged that offer naïve investors excellent “opportunities” for progressively larger sums of bitcoin. MLMs, as they’re known, are predicated on offering quick returns, but involve taking more money for the promise of even higher profits.

One major company that has been repeatedly outed is OneCoin, whose owners were implicated in several other shady operations. The company offered investors massive earnings, as well as luxury goods and perks for paying more. 

However, there is little information on the company outside of its site, and users have left scathing reviews online. It’s important to pay attention to a company’s fine print and ensure that their claims are feasible and real. Avoiding these scams early can protect investors’ wallets.

With the current craze, being vigilant and doing one’s due diligence are a must before investing in bitcoin. The market is also showing signs of maturity, leading to better transparency and clearer rules. Regardless, a smart investor’s first step should always be careful research to ensure their investments are winners.

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