You have probably heard about the Robinhood app on YouTube and want to know if it’s available in Singapore, right?
Robinhood is a modern and easy-to-use investment app from the US, which has introduced the concept of commission-free trading in financial products such as stocks and ETFs.
Do you want to know if the Robinhood app is available in Singapore, its expansion plans, and the alternatives available in Singapore? We’ve got you covered!
What is Robinhood?
Robinhood was founded in 2013. Since then, it has played a major role in disrupting the brokerage industry by allowing US retail investors to trade with no commissions, alongside its biggest rival, Webull. Robinhood is defined as a commission-free online broker that offers the possibility of trading stocks, ETFs, options, and cryptocurrencies.
The results are clear: over 18 million users! The competitors of Robinhood have been monitoring this exponential growth closely, and, in October 2019, some major well-established brokers in the US, such as E-Trade, TD Ameritrade, and Charles Schwab, announced in quick succession that they were eradicating trading fees.
Is Robinhood Available in Singapore?
Unfortunately, Robinhood is not yet available in Singapore, nor any other country outside the US. It had planned to open in the UK in 2020, but it was postponed indefinitely due to Covid-19 (more info: here). Their global expansion has taken no step further since then.
But do not lose hope! You will find some alternatives in Singapore that have proven reliable (and perhaps even more reliable than Robinhood!).
The covid-19 stock crash during the first quarter of 2020 showed some vulnerabilities of the Robinhood platform. The app collapsed several times, and investors could not trade during the most volatile markets in history. The company is facing some lawsuits due to these outages.
Besides, Robinhood has faced several security breaches in revealing sensitive information about its clients, and, at one point, it even allowed “infinite leverage” that was shortly corrected afterwards. Still, it did not avoid major losses for some clients.
Robinhood Singapore Alternatives
To help us answer this question, we focused on commission-free brokers, which are available in most countries in Singapore. Given that, here are our suggestions:
Commission-free stock and ETF trading. You can also copy other traders/investors. Slick, modern, and easy for anyone to use. It is trusted by over 20 million clients worldwide.
Disclaimer: 67% of retail CFD accounts lose money.
Commission-free stock and ETF trading (+10,000 global stocks and ETFs), 0.15% of currency conversion fee, and presents fractional shares. Over 1.5 million customers.
Disclaimer: 76% of retail CFD accounts lose money.
1 free trade every month. Mobile app only. It charges a 0.12% custody fee per annum.
eToro at a glance
Founded in 2006, eToro is a well-known worldwide fintech startup and the leader in the social trading field (follow other people’s trades), with over 20 million users worldwide. You can also invest in other products such as CFDs, ETFs, stocks, commodities, Forex, and cryptocurrencies through their platform, which is intuitive and simple to use, making it a good choice for beginners, not to mention that they started offering commission-free stock and ETF trading in Singapore (not all ETFs are commission-free).
Opening an account and depositing is easy, and you can even try it out with virtual money. On the downside, spreads can be high for some products. The only currency accepted is the USD, which means that you’ll be charged currency conversion fees upon deposit and withdrawal if you deposit in Singapore Dollars.
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 67% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
2# Trading 212
Trading 212 at a glance
Founded in 2006, Trading 212 is a fintech based in London that aims to democratize the entire investment process through a simple mobile application. The company aims to do this by allowing anyone to invest in over 10,000 stocks and ETFs, Forex, commodities, CFDs, and cryptocurrencies. Over 15 million people have already downloaded the app. In 2017, it was the trading app with the most downloads in Germany and, since 2016, it has remained 1st in the United Kingdom.
In Trading 212, you will find commission-free stocks and ETFs trading, fractional shares, and even an automatic investment system (Robo-advisor). Opening an account is extremely quick and easy. On the downside, it shows limitations regarding available products, such as the lack of bonds and options. It charges a 0.15% currency conversion fee when buying assets in a currency different from your base account.
Within the app, you will notice two distinct sub-platforms: Trading 212 Invest, where you can trade a range of assets free of charge and trading 212 CFD, where you may trade leveraged financial products (CFDs).
76% of retail investor accounts lose money when trading CFDs with this broker. It is important to understand how CFDs work and the risks involved in trading, such as losing all invested capital.
3# Revolut Trading
Revolut at a glance
Founded in 2019, Revolut Trading is part of the Revolut app (existing since 2015) and provides its users with an efficient way to invest (all in one place). It only allows investment in American stocks (+750 companies) free of charge up to 1 transaction per month, cryptocurrencies with a spread of 1.5%, and gold and silver with a spread of 0.25% when the market is open. Still, there are no inactivity or withdrawal fees.
The app is super intuitive, and the account opening process is 100% digital, fast, and secure. Unfortunately, it still has a restricted range of financial products, and the account can only be denominated in dollars. Some of the non-accessible assets are ETFs, CFDs, Forex, bonds, and options. Furthermore, it has no educational or market research material, and it charges an annual custody fee of 0.12%.
Learn more in our in-depth Revolut Trading Review.
Which platform should you choose?
Some factors you should know when choosing an online broker are the fees charged, if it is regulated by top-tier institutions such as the Monetary Authority of Singapore, the range of products it allows you to trade (not all platforms allow you to trade cryptocurrencies or Singapore-listed stocks), among others.
The best online broker in your specific case will depend on your profile, preference, and objectives. Explore the websites above and decide for yourself!
A reminder that the above should not be seen as investment advice and should be considered information only. Investors should do their own research and diligence about the services and opportunities best suited for their risk, returns, and impact strategy.
Hope we helped, and leave your comments below.
Is Webull available in Singapore?
No, Webull (Robinhood’s biggest competitor in the US) is also not available in Singapore.
What about other US-based investment platforms? Are Acorns, M1 Finance, and E*Trade available in Singapore?
No, Acorns, M1 Finance, and E*Trade are not available in Singapore either. Only US citizens/Green Card holders are eligible to open an account on these platforms.
How exactly does Robinhood make money?
The online broker earns money from interest earned on customers’ cash balances (money in your account not invested) by selling order information to third parties (high-frequency traders, for instance) and margin lending.
Regarding selling orders, the US Securities and Exchange Commission (SEC) is still investigating Robinhood for not fully disclosing its practice of selling clients’ orders to high-speed trading firms.
Until October 2018, Robinhood would not clearly state that it was receiving payments for order flows. By law, any financial company must reveal all the material facts an investor would want to know before making any investment decision.