Robinhood is a modern and user-friendly investment app from the US, founded in 2013. It has introduced the concept of commission-free trading in financial products such as stocks and ETFs, competing with its major rivals like Webull, E*TRADE, and TD Ameritrade.
Its 10+ million monthly active users can choose between investing in stocks, options, ETFs, and cryptocurrencies, all without trading fees. One drawback of Robinhood is the limited availability of investment options – including mutual funds – compared to its competitors, E*TRADE and TD Ameritrade.
Want to know if you can trade mutual funds on Robinhood? Wondering about alternative investment platforms to invest in mutual funds? We’ve got you covered!
Can you trade Mutual Funds on Robinhood?
Unfortunately, you are not able to trade mutual funds on Robinhood! As of this writing, Robinhood doesn’t offer mutual funds trading.
It’s possible that Robinhood’s decision not to offer mutual funds aligns with its business strategy and its focus on delivering a straightforward, commission-free trading experience.
If you’re considering mutual funds, you may want to explore other brokerages or financial institutions that could provide them.
Source: Robinhood
Which Products Can I Trade on Robinhood?
| Investment Option | Availability |
| Futures | ✕ |
| Stock | ✓ |
| ETFs | ✓ |
| Options | ✓ |
| Crypto | ✓ |
| Forex | ✕ |
| Mutual Funds | ✕ |
| Bonds | ✕ |
| CFDs | ✕ |
Best alternatives for investing in Mutual Funds
Brokers’ comparison table
| Broker | Minimum Deposit | Supported Mutual Funds | Available in the US? | US Mutual Funds Fees |
| Interactive Brokers | $0 | Alternatives, Balanced, Bond, Commodity, Equity, Mixed Investments, Money Market and Stock | Yes | Lesser of 3% Trade Value or USD 14.95 per Transaction ( min. size on first order is $3,000 – $100 after it). |
| Fidelity | $0 | Domestic Equity, International Equity, Sectors, Fixed Income, Asset Allocation, Index, Money Market | Yes | $0 and no minimums to invest (in fidelity mutual funds) |
| TD Ameritrade | $50 (electronic transfers); no account minimum | Money Market Funds1 | Yes | In No-load Up to $49.95 or $74.95 ( funds from certain fund families) for buys;$0 for sells |
| E*TRADE | $0 | Alternatives, Balanced, Commodity, Domestic Equity, Life cycle, Money Market, Municipal Bond, Municipal State Bond, Non-traditional Equity, Specialty, Taxable Bond | Yes | For load funds depends on the fund. For No-load, it is $0. |
| Charles Schwab | $0 | Index, Active Equity, Bonds, Asset Allocation | Yes | Up to $74.95 and $0 in Charles Schwab |
| Ally Invest | $0 for Self-Directed brokerage cash account; $2,000 for Self-Directed brokerage margin accounts. | Bonds, stocks and other types of securities | Yes | Subject to charges from mutual fund |
What Makes a Good Broker for Mutual Funds?
- Diverse Fund Selection: This factor emphasises the importance of having access to a broad range of mutual funds. Diversification is a key principle in investing, and having a diverse selection of funds means you can spread your investments across different asset classes, industries, and strategies. This reduces the risk associated with having all your investments concentrated in a single fund.
- Low Costs: Low costs refer to transaction fees and expense ratios. Transaction fees are charges imposed when you buy or sell mutual fund shares, and high fees can eat into your returns over time. Expense ratios are ongoing fees deducted from the fund’s assets to cover management and operational expenses. Lower costs mean more of your money stays invested and can potentially grow over time.
- User-Friendly Platform: A user-friendly platform is crucial for your ease of use and navigation. A good platform should make it simple to research mutual funds, analyse their performance, and make investment decisions. Whether you’re an experienced investor or a beginner, a user-friendly interface streamlines the investing process and helps you make informed choices.
- Regulatory compliance: It’s essential to select a broker that adheres to relevant regulations and is overseen by recognised regulatory bodies in the country where they operate. For instance, this would include being regulated by the Securities and Exchange Commission (SEC) in the United States. In the United Kingdom, brokers should adhere to the Financial Conduct Authority (FCA), and in Canada, the regulator is the Mutual Fund Dealers Association of Canada (MFDA). By choosing a broker regulated by reputable global regulatory bodies, you ensure that your mutual fund investments are protected and held to high standards of integrity and transparency.
These factors are essential when selecting a broker for mutual fund investments because they directly impact your ability to build a diversified, cost-effective, and secure investment portfolio while maintaining a smooth and user-friendly experience.
Bottom Line
Robinhood does not offer the option for mutual fund trading. For those interested in mutual funds, we recommend considering alternative brokerages such as Interactive Brokers, Fidelity, Charles Schwab, TD Ameritrade, E*TRADE and Ally Invest, which provide a wide array of mutual fund options and extensive tools for informed investment decisions.
Evaluate aspects like regulatory compliance, the quality of the trading platform, fees and the diversification of the available funds. Remember that each broker comes with its unique advantages and disadvantages, so making a selection aligned with your specific investment requirements is paramount.
Hopefully, we have helped you with your choice!
1Since TD Ameritrade was acquired by Charles Schwab, you can invest in other categories of mutual funds through a Schwab account.
Mariana is currently a finalist in Management program at the University of Minho, and she also serves as a digital ambassador for a leading Big4 company in the field of financial consulting, Ernst & Young.
Mariana's primary areas of interest revolve around the exact sciences, numbers, and the financial sector. Presently, Mariana holds the position of COO at a junior initiative within her university, dedicated to promoting financial literacy among the youth and addressing the educational challenges faced in Portugal.
