Robinhood vs M1 Finance


2019: M1 Finance versus Robinhood for online investing. Compare cost, brokerage fees, IRA accounts, and differences. Which firm is better?



Overview of M1 Finance vs Robinhood


Robinhood and M1 Finance are two modern brokerage firms that provide investment services a little differently than traditional companies. Robinhood started by offering free commissions, and M1 has followed suit. There’s more to these two brokers than $0 commissions, however. Here’s the showdown.


Pricing


Broker Fees Stock/ETF
Commission
Mutual Fund
Commission
Options
Commission
Maintenance
Fee
Annual IRA
Fee
Robinhood $0 na $0 $0 na
M1 Finance $0 na na $0 $0


Range of Investments


At M1 Finance, investors trade Pies. These are collections of securities; more specifically, they are stocks and ETF’s. M1 Finance creates Pies for its customers to trade, and clients can create their own Pies as well. Pies created by the broker have certain themes, such as energy or hedge funds.

The maximum number of holdings in one Pie is a hundred, and the minimum is just one. So you can trade just one stock or ETF at M1 by creating your own Pie and putting one security in it. One account at M1 Finance is limited to 500 holdings in total.

Because M1 Finance emphasizes this type of trading, it does not offer options, mutual funds, bonds, or cryptocurrencies.

Robinhood also does not offer mutual funds. It does provide trading in ETF’s. Because they don’t have to be placed in Pies first, some traders may prefer Robinhood in this category.

Robinhood emphasizes low-cost trading of stocks and ETF’s. In this sense, it is similar to M1. But Robinhood has recently launched trading in options, and here it surpasses its rival. Robinhood customers also now have access to cryptocurrencies. Like M1 Finance, Robinhood does not offer bonds.


M1 Finance vs Robin Hood


Technology


Because M1 Finance isn’t a typical online broker, it doesn’t provide a desktop or browser-based platform. Trading of Pies takes place on its website. It’s fairly simple, but easy to use. There’s an icon that reads ‘Create New Pie’ and clicking on this takes the user through the necessary steps to complete the short journey.

One feature we found on M1’s site that we really liked was that each stock listing had a company logo displayed for it. This made browsing through equity listings a little faster.

Robinhood also doesn’t perform spectacularly in this category. The broker fails to deliver a desktop platform, although it does now have a browser-based trading system. It’s fairly simple and is actually a copy of the company’s mobile app.

Both the mobile platform and browser system can buy and sell stocks, ETF’s, options, and cryptocurrencies. Like the M1 website, charting on the Robinhood platform is very simple. There are no technical studies or drawing tools, for example. The amount of information on securities is fairly limited.

A great feature that the Robinhood platform displays is the average trade price its customers have paid for a security along with a comparison to what other customers elsewhere have been paying.


Mobile Apps


As we already mentioned, Robinhood offers a mobile app, and it’s the same interface and has the same features as its browser-based platform. Robinhood also offers an Apple Watch platform, which M1 Finance fails to do.


Robinhood vs M1


The M1 mobile app isn’t exactly the same as its website, but it offers a lot of the same functions. For example, it’s possible to browse through available Pies and trade them. It’s also possible to create your own Pie on the mobile app. As with Robinhood’s mobile app, the M1 Finance platform only provides very simple graphing.

Neither mobile app has streaming news or a check deposit feature. We hope to see these soon.


Promotions


M1 Finance: Pay $0 broker commissions or fees when you open account at M1 Finance.

Robinhood: Get free stock with $3-$7 value when you open an account.



Customer Support


M1 Finance clients can reach a company associate anytime from 9:00 am till 5:00 pm. The company is based in Central Standard Time. There are no weekend hours, and the broker also fails to deliver online chat. The broker’s website does have a chatbot, although it’s only available to current customers. We liked the FAQ that appears on the M1 Finance site. It answers a lot of critical questions, such as how to buy and sell Pies.

Robinhood underperforms its rival here. It’s open only during market hours, so its customer service session is open an hour and a half less per day. Strangely, it offers a phone number that isn’t toll-free. Many of the broker’s clients have complained about poor service from the customer support desk.

Both companies have a service e-mail. Neither brokerage firm offers an international phone number or branch locations.


Trading in Funds


As we have already pointed out, neither brokerage house offers mutual funds (see Best mutual fund brokers). They do offer trading in exchange-traded funds, although foreign ETF’s are not on tap.

We found both brokers rather deficient in ETF resources. Neither firm offers any learning materials on the basics of ETF’s. Fund profiles are rather brief on both brokers’ trading platforms. At Robinhood, we found basic ETF data, such as dividend yield, the day’s volume, and 52-week range. The broker does not provide any ETF reports or ratings.

At M1 Finance, there’s a little more information on ETF’s. During our investigation, we found news articles on ETF profiles. Small graphs showed 3-year and 5-year annualized return histories. On a larger graph, dividend pay dates were shown. Fund details were also more extensive with information on top holdings and geographic allocation.


Research & Educational Resources


Now we come to investment education, and here too, both firms are fairly elementary. Neither company offers financial learning materials, such as how to trade stocks or the basics of technical analysis.

For stocks, there are profile pages available with either broker-dealer. During our research, we found more information at M1 Finance. As with ETF’s, the broker displays dividend dates on a stock’s graph and shows annualized return figures. News stories from CNBC and Reuters are available as well.

The Robinhood platform has earnings information on individual equities in a simple graphic. It also shows buy, hold, and sell recommendations from multiple analysts. Some of these come with commentary. Finally, we found news articles from CNN.


Promotions


M1 Finance: Pay $0 broker commissions or fees when you open account at M1 Finance.

Robinhood: Get free stock with $3-$7 value when you open an account.



Robinhood vs M1 Finance - Judgment


Considering $0 commissions, both brokerage firms performed well in our survey. Overall, they seem about even. Robinhood (read review) would be a better choice if you want to trade options or cryptocurrencies, while M1 Finance (read review) would be a wise move if you like investing in stocks and ETF's.


Robinhood vs M1 Finance reviewed by Brokerage-Review.com. Rating: 4.5