Robinhood, a digital investment platform that has encouraged a new generation of investors to enter the markets, notes that with millions of new investors or traders now joining Robinhood and investing for the first time, financial education has “never been more crucial.”
As the company continues to work towards “democratizing” finance for all traders, they also remain focused or committed to expanding their educational resources so that financial information is a lot more accessible.
The Robinhood team writes in a blog post:
“To kick off the new year, we’ve revamped and expanded our educational resource hub, Robinhood Learn. Now, it’s even easier to explore the hundreds of digestible articles we offer on the basics of investing, investing lingo, and market trends.”
Users may browse Robinhood’s new Investing 101 guide in order to learn more about investing strategies and also get “the low-down before you dive in.” Users may also check out Robinhood’s library of investing basics or fundamentals and definitions. Some topics to get people started on this learning process include why we should think about investing in the first place, the main things we need to do or consider before investing, and how we can start budgeting.
Robinhood confirmed that as they continue to expand their options education materials, they will also create a brand new section to help people learn “the ins and outs of options trading.”
The Robinhood team noted that they’ve prepared over 800 informative articles to help guide investors on their financial journey. More than 3.2 million individuals have reportedly “discovered” the platform’s Learn articles, and Robinhood is now hoping that this latest update will “prove to be a financial resource for even more in 2021.”
As reported in December 2020, the US Securities and Exchange Commission (SEC) had charged Robinhood with misleading customers on how it generates revenue. Robinhood strategically settled the charges with a $65 million penalty without admitting or denying the SEC’s findings, according to a statement by the Commission.
Last month, Robinhood also slashed its margin rate in half from 5% to 2.5%. The margin rate is the interest paid by account holders when they borrow against assets held in an account. Typically, a brokerage account holder is allowed to borrow up to a certain percentage of their holdings as the loan is secured by existing assets. If an investor goes beyond the allowable percentage of borrowing, the platform may issue a margin call forcing the investor to cover a portion of the money owed.
Robinhood explained that margin investing is offered to eligible customers through Robinhood Gold, a premium investing account that includes Nasdaq Level 2 market data and Morningstar Research Reports, for $5 a month. The first $1,000 of margin is included in the $5 monthly fee. After that, customers pay a flat 2.5% yearly interest rate on any amount used above $1,000.