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Robinhood Assets Under Management (AUM)

Robinhood total assets under management. Robinhood AUM for 2018: client assets, brokerage accounts, investments.

Robinhood Assets Under Management (AUM)

Robinhood is a new entrant into the world of securities trading. The broker is a small company, but it’s making a lot of waves. The ultra-low-cost firm has lowered its commission to $0. Yep, that’s right, Robinhood offers trading in stocks and ETF’s free of charge. Despite this fantastic price, the broker-dealer hasn’t attracted the lion’s share of the self-directed investing market.

Estimations of Brokerage Size

While the company released very few specifics about its operations, we can confidently assume that they have over 2 million customers. The company was launched in April of 2013, which makes it a very new firm. Many investors are hesitant to transition to Robinhood, largely because of concerns over the company’s uninspiring customer service and lack of financial offerings.

Robinhood does not provide information on its total assets under management. Considering that most investors keep the bulk of their money in mutual funds and Robinhood does not offer mutual funds, the broker's AUM must be much smaller than at other brokerage houses of the same size (see Largest brokerage companies by assets).

Best Investment Firms For Beginners

Below are the best investment firms for beginners to open a brokerage account:

-  Ally Invest (review) charges only $4.95 per trade (even for broker assisted trades!) and has the best investor community of all brokerage firms. Their pricing drops to $3.95 for investors who make 30 or more trades or have $100K account balance. Minimum to open a brokerage account is $0.

Promotion link: Get a $200 cash bonus or $500 in commission-free trades.

-  TD Ameritrade (review) charges $6.95 per trade commission on both stocks and ETFs trades and has $0 minimum to open an account. The broker is one of the best online brokers in the country, and boasts one of the highest customer loyalty levels in the industry. There are over 2,000 commission free mutual funds and over 100 commission free ETF's at this broker.

TD Ameritrade offers a variety of investment products at reasonable cost to investors. Stocks, bonds, ETF's, and mutual funds are some of the more popular securities available. There are plenty of free educational products on TD Ameritrade's website and a vibrant trader community.

Promotion link: Trade free for 60 days + get up to $600.

Interest of Private Equity Investors

Robinhood has engaged in a lot of fundraising, trying to find backers of its new brokerage model. For instance, it raised $13 million in funding from Index Ventures in September of 2014. It also raised millions of dollars at various other events. For example, it received $50 million in funding in 2015 from New Enterprise Associates. Most recently, the broker received $110 million from DST Global, who values Robinhood at $1.3 billion. At this estimate, Robinhood is a very small broker.

Because Robinhood is launching its service in Australia, the brokerage firm is expected to increase in size globally in the near future.

Robinhood AUM Comparison

For example, Ally Invest, which is a small player in the industry, has $4.7 billion in client assets. Ally Invest’s valuation will be smaller than $4.7 billion, but it’s shareholders’ equity is probably larger than $1.3 billion. The shareholders’ equity of Ally Financial, the parent company of Ally Invest, is over $13 billion.

E*Trade is owned by E*Trade Financial Corporation. The brokerage arm of the company has over $300 billion in client assets sitting in 3.5 million customer accounts, which far outstrips our estimate for Robinhood. E*Trade also earns over $400 million in revenue every year, just from commissions. As already noted, Robinhood earns no commissions from stock and ETF trades, and because the broker doesn’t offer options, bonds, or mutual funds, it obviously doesn’t earn any income from those products, either.

E*Trade’s recent balance sheet displays a shareholders’ equity of more than $6 billion, which is larger than our estimate for Ally Invest, and much larger than Robinhood.

And E*Trade isn’t a large broker by industry standards. Merrill Lynch is, and it charges much higher fees than Robinhood. The broker-dealer has almost 2 million client accounts, far more than our guess for Robinhood. This asset base produces over $16 billion in annual revenue, far surpassing Robinhood.