It's everyone's right to shoot themselves in the foot with dumb financial decisions. Robinhood isn't doing anything egregious here, they're only reducing friction and fees.
I've used the app sparingly in the past with "fun money" but haven't done serious investing with it.
> It's everyone's right to shoot themselves in the foot with dumb financial decisions.
The industry regulations would indicate otherwise. Generally, the “dumber” the money, the more regulatory protections that will apply. At their core, financial regulators are consumer protection entities.
Not really - the regulations are more or less in place to try to soften the impact of the dumb decisions (when they do happen), not to remove the freedom to make said dumb decisions.
Nothing is stopping anyone from putting their life savings into a legal dumb investment. Regulators and the government sure won't stop you from liquidating your 401k early. At some point common sense comes into play and you need to be smart with your money.
>US SEC has accredited investor requirements specifically to keep people from being fooled into making "dumb" investments
What stops me from liquidating my 401k and investing all of my money into a company that misses their earning goals this week? Where does the US SEC come into play here?
Huh? That's just not how this works. There's always a spread between the cash interest that the custodial firm gets on the balances it holds and the interest it pays to the customers.
Good for you. (Not sarcasm —- this is what individual stock investing should be for retail. For fun, to have a tiny bit of skin in the game.) But many people let it get out of control, either because they lack this self discpline, or because they randomly see positive results and then think they’re good traders.
Those people can freely lose all of their money through a lack of self-control with any other brokers as well. Just because Robinhood has a good UI/UX that makes it easy to navigate doesn’t really qualify it as “predatory” or puts it at fault more than any other brokerage service.
> Amateur investors are best off buying indexes and holding forever.
And you can do so on robinhood by buying ETFs while potentially saving money on transaction fees if you were to use a traditional brokerage (I say potentially because vanguard lets me buy their etfs without a transaction fee when I use their brokerage account).
I've used the app sparingly in the past with "fun money" but haven't done serious investing with it.