In a bid to help inexperienced traders, Robinhood has introduced a set of recommendations to help the first-timers make sense of the technical aspects of trading.
Robinhood to Help First-time Investors Make Investment Decisions
Robinhood has devised a plan to help novice investors to navigate the world of trading. That is, new users who are yet to add anything to their investment profile can simply choose the option to get help with their first investment. After clicking on the help button from the investment tab, Robinhood then presents a questionnaire that asks about the user’s investment goals and how long they plan on investing, and more.
Upon the user’s answers, Robinhood then recommends a personalized portfolio for them. This portfolio comes along with 4 different exchange-traded funds (ETFs), with more information about each, and why Robinhood picked it for that particular individual. However, even after reviewing the funds, the decision to invest or not still depends on the individual.
Another product Robinhood now offers is what it calls “Tours” for those totally clueless about investing. The Tours app shows a potential investor the ropes of trading. It achieves this, simply by giving a quick overview of all terminologies related to investment and trading. The app also explains other important elements that are useful for baby investors and even those that have some basic knowledge about the world of investing.
Meanwhile, It is only advisable that making major investment decisions should require more than a simple questionnaire.
Also recall that in 2020, Robinhood was fined $70 million by financial regulators. This was in line with the firm failing to properly protect investors and monitor trades happening on its platform. Well, it just may be that the firm has now learned and is doing its best to stay compliant with regulations around its operations.
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