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Stock trading apps have taken the industry by storm since the introduction of Open Banking.
The growth of many investment apps like Robinhood has encouraged investors and entrepreneurs to build their trading/investment apps.
But back then, in order to establish one, you had to start from scratch with the backend, the trading engine, the payment methods, and the connections with different institutions.
Fortunately, that’s no longer the case. These days, even if you lack any financial understanding, you can build a stock trading app similar to Robinhood because of the many APIs available.
How do you do that? Find out by reading on!
The market size of digital investments
Take a look at the market size of digital investments:
- The global digital investment market is expected to reach USD 6,964 billion by 2028.
- According to Million insights, It is estimated that the digital investment market will grow at a CAGR of 16.1% from 2021 to 2028.
- Market Study Report estimates that the stockbroker app market is expected to reach $447.97 million by 2025.
What is the Robinhood app?
The Robinhood app is a trading platform, and the app offers its customers valuable services such as zero trade commissions and various investment options.
The app offers trades in gold, cryptocurrencies, stocks, options, etc. However, there is no minimum deposit amount to set up an account. The app offers advanced trading tools and features to users who have taken their paid app subscription.
Take a look at some of the important details.
| Launch date | 18 April 2013 |
| Headquarter | Menlo Park, California |
| Founders | Vladimir Tenev and Baiju Bhatt |
| Business Type | Public (NASDAQ: HOOD) |
| Industry | Stockbroker and cryptocurrency |
| Commission rates | $0 on all stocks |
| Investment options | Stocks, bonds, ETFs, options, crypto |
| Min deposit | $0 |
| Available platforms | Web, Android & iOS |
Check out the best way to create your app like Robinhood.
Tips for creating a successful investment app like Robinhood
Here at Idea Usher, from our experience of making apps similar to Robinhood, we have found some most effective tips to help our clients to build a successful app like Robinhood.
1. Perform competitor analysis in the financial industry
Research investing apps like Robinhood will help you to find how well they are running their business and making money from their app. Check other best stock trading apps as well for your market research.
2. Take care of all the investment regulations
Running an investment business requires rules and regulations that you must follow that apply to your country and where you are going to run your investment business.
3. Hire a team to build your investment app
The development team will help you create your app from the start by building and implementing all the features your investment app needs, like Robinhood. The team will carefully select the best tech stack to make your trading app for better outcomes.
4. List all the features you want to include in your app.
At the time of competitor research, there may be a possibility that you may come up with a unique app idea. In that case, you can list all the features you want to include in your app to provide a better user experience.
There are some required features you must have to add to your trading apps.
Top features of Robinhood that you can add to your app
To develop your trading apps, you must know the key features that make the Robinhood app stand out from the crowd.
Explore all the features to implement on your app:
1. Dashboard
The Robinhood app offers a dashboard to its users. In the dashboard, the users can track their portfolio, and access watchlists containing prices of all the stocks and cryptos.
Similar to the Robinhood app, you can create an app dashboard and can modify the dashboard by including additional and required features from our app development experts.
2. Market data
Robinhood app provides up to date market data for its app users. The data include all the stocks’ top gainers and losers based on their price performance.
Additionally, you can update the market data on your app regularly to help users get an accurate insight into all the stocks trending in the market.
3. Portfolio
Users can track their investment in all stocks and cryptos with the help of the Robinhood app’s portfolio feature. This feature helps users to create and manage their portfolios without depending on third-party agents.
You can add multiple filters to help users find the best stocks for their investments and the stocks they are searching for.
4. Stock trading functionality
Users love the Robinhood app most because it provides a better experience for placing trades and taking positions for stocks and cryptos.
App users can place trades on their app to sell and purchase different stocks and cryptos. Also, the app offers multiple additional features, such as helping users set a stop loss to avoid loss and target profit to exit out from the trades after taking out profits.
However, the app has room for improvement that you can improve by adding additional features such as alerts on trading indicators, etc.
5. Notifications
Robinhood app informs its users about price changes for the stocks they have invested in with the help of the notifications feature.
Like the Robinhood app, you can implement a notification feature to your app to help users to know the latest investment opportunities, news, payment status, etc.
6. News Feed & tutorials
Robinhood app provides tutorials and news related to trading and investing to help its users to make the right decision. Many beginners love Robinhood because the app helps them learn much about trading and investing.
Providing news within your app will help users to select the best stocks for their trade. Moreover, the news feed includes the content of trading tutorials from different institutions and gurus, which benefits beginners on your app.
7. Support
Robinhood app provides customer support to their app users to solve their every doubt.
To offer a better user experience, you must resolve all the challenges and difficulties that users will face while using your app. The support team will help users to provide a quick solution for the problem they are facing on your apps, such as deposit and withdrawal problems or any issues related to stock trading.
Also, you can build a chatbot for your app to bring automation and improve your financial services for most repeated issues and challenges.
Now, let’s check all the development steps to build your app.
Development steps for building an app like Robinhood
Here are steps you can follow to build your trading app like Robinhood:
1. Market research
During the market research phase, the Robinhood app has studied its audience to know their challenges and pain points. The brand noticed that many users avoid opening their Demat accounts to account opening charges. Therefore, the app allows users to open their accounts free of charge, allowing them to trade and invest on their platform.
Also, the platform adopts different approaches to attract investors by creating educational content and announcing its referral programs where users can get a commission on each referral.
Like Robinhood, you can study your target audience to understand how to encourage them to your platform.
2. Get a business license for your trading app
Robinhood has regulated its platform by the Financial Industry Regulation Authority, and you can do the same to regulate your business.
Also, based on your country, you can contact lawyers and government authorities to know about the regulations and get a license for your business as a broker to allow your customers to trade and invest.
3. Select the app design for your trading app
Have a look at how the Robinhood app has adopted a simple and plain design approach for their app.
Like the Robinhood app, you can implement the same design guidelines to your app by hiring the best app developers experienced with good app design practices.
4. Start app development
Decide on the following things when entering the app development phase:
| Platform | Robinhood offers their trading platform on both websites and mobile devices. However, you are free to select where you want to publish your app. You can choose multiple platforms to scale your business fast. |
| Business model | Robinhood makes money by taking commissions and offering its paid services. You can follow the same business approach and choose other app monetization models to make profits from your trading platform. |
| Technical requirements | You can select the tools and technologies you want to use for building your app. Also, you can use third-party API to offer real-time information about the stocks and crypto market to your app users. |
5. Publish and perform good app marketing
After app publishing, the Robinhood app’s affiliate program helps them attract many users to their platform.
You can perform good marketing practices to promote your trading app in the market. Some IT companies will also help you provide marketing support to boost your app and bring more customers to your trading platform.
To get more inspiration from trading apps, you can also check other trading apps.
Top alternative to the Robinhood app
.Check the following apps you can consider as an alternative to the Robinhood app:
1. WeBull
The app is a US-based platform that offers day trading, and the Webull app offers customer loyalty programs.
Moreover, the app provides multiple offers such as Stocks, Options, ETFs, OTC, and ADRs for trading and investments.
| Pros | Cons |
| Sign up bonus | Less support |
| Fast account setup | Restrict in-app money transfer |
| Commission free trading |
2. M1 Finance
The platform is a money management tool allowing users to manage their investments. Instead of stock quantity, the app allows its users to purchase stocks based on the percentage of shares. Ex: 25% in Microsoft, 15% in Tesla, etc.
| Pros | Cons |
| Offers both stocks & ETFs | Not suitable for active traders |
| Auto money withdrawal | No tax-loss harvesting |
| Commission free trading |
3. Vanguard
The app offers multiple financial services to its app users, such as mutual funds, wealth management, trading in stocks and Bonds, etc.
The platform is also suitable for users inexperienced in trading and investment because it offers personal and digital advisors for their customers.
| Pros | Cons |
| Low-cost funds are available | Limited analytics and research tools |
| Zero trading fee | |
| Huge fund base |
However, your app users might feel insecure about using apps because your app will include funds transfer activity in huge volume.
To win users’ trust, you can follow and implement some best practices to protect your app users’ data.
Tips to protect your users’ data on Robinhood-like apps
Here are some of the best data protection practices to provide a safe experience to your app users.
1. Biometric authentication
The feature will help users to use fingerprint sensors and face recognition to unlock their app for making trades and investments. The feature adds a layer of security to your app by eliminating anyone from using the app, as the app requires biometric authentication, which only app users can fulfill.
2. Multi-Factor authentication
The feature helps users protect their app data by allowing them to enter the verification code and password when they will try to log into your investment app from different devices.
The authentication code is OTP (One Time Password) generated within the app. You can use Google Authenticator to provide multi-factor authentication.
3. Data encryption
Your app can safely store users’ sensitive information, such as their card details, by encrypting users’ data. Data encryption gives an excellent challenge for hackers to steal users’ data from your app.
4. Providing regular security updates
Cyber attacks are happening on different apps regularly. You must provide a regular security patch to keep your app up to date based on all security measures. You should only distribute your app from trusted app marketplace such as App Store and Google Play.
Also, to improve the trustability of your business even better, you must implement regulatory compliance to your trading apps.
Regulatory compliance to run your financial services
Each country has regulations for the financial services industry.
You can check the following regulators to run the business of your financial services efficiently:
For financial services running in the USA:
- CFPB: Consumer financial protection bureau
- CFTC: Commodity futures trading commission
- Fincen: Financial crime enforcement network
- BSA: Bank secrecy act
For financial services running in the UK:
In the United Kingdom, each trading app must follow FCA’s regulations (Financial Conduct Authority).
Knowing the monetization model of the Robinhood app will help you understand the best way to make money from your trading app business.
Here’s how Robinhood apps make money so that you can implement the same in your investment business. Also, here are some more ways to monetize your apps.
How does an app like Robinhood make money?
1. Revenue from users’ transactions
Whenever users place a trade from the Robinhood app, the app takes out a small portion of users’ orders at the execution time. The revenue from users’ transactions depends on the trade volume ordered by each app user.
2. Subscription fees
The app offers a gold subscription of $5 per month, where users can upgrade to access multiple trading tools, research reports, large instant deposits, margin trading, and so on.
3. Margin fees
When users take a stock loan of more than $1,000 for margin trading, users have to pay a 2.5% interest rate to the app. The features are only available for users who have taken Robinhood Gold subscriptions.
4. Fees on services
Users who want to transfer money from one Robinhood broker to another will have to pay $75 as a transfer fee. Moreover, the app also charges $20 for overnight check deliveries, $5 for paper statements, and $5 for paper confirms.
5. Bank’s interest
The app takes interest from their bank account balance. The money app users deposit to the app is stored in Robinhood’s bank account. Thus, helping their app to take interest on an annual basis gives another income source for their business.
Still, more reasons tell why investing in building apps like Robinhood can be your best decision.
Why should you invest in making Robinhood-like apps?
Instead of investing in stock markets in other assets, you can best go for app development to provide financial services for your App users.
Moreover, there is a higher chance of success with building your app than investing your money in the stock market, as the market involves a lot of scams by manipulators to take out all the money from retail traders.
However, the market manipulation will not affect your app business as you will make money from your app users by trading commissions and other means. Also, creating an app like Robinhood will help you scale your business faster without involving risk, usually in stock or Crypto trading.
Look at the stats of the Robinhood app to get an idea of how well the business is performing in the market.
- The Robinhood app generated $1.81 billion in 2021
- The app had 15.9 million users in 2022
- Robinhood has assets under management worth 98 billion dollars
Also, have a look at how the Robinhood app managed to improve its valuation within years:
| Year | Valuation |
| 2017 | $1.3 B |
| 2018 | $5.6 B |
| 2019 | $7 B |
| 2020 | $11.7 B |
| 2021 | $20 B |
Ready to build your app like Robinhood?
After knowing the benefits of building an app like Robinhood, it is better to assume that you want to know how to build your trading app.
Building an app like Robinhood requires extensive project management and programming skills to build an app starting from scratch that only the best app development team can fulfill.
The team can help you with your app-building, app design, implement all the app publishing guidelines, and so on. Contact Idea Usher to build your app from an experienced development team that has already developed many trading apps for their clients.
Also, you can call Idea Usher for a free consultation to help you know how their team can help build and publish your app, like Robinhood.
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FAQ
1. What is the Robinhood app built on?
Robinhood app consumes different tools and technologies such as Python, Django, SQL, MongoDB, Redis, Javascript, C, and AWS.
2. What is the cost to develop an app like Robinhood?
The app building cost depends on multiple factors such as selected tech stack, selected features, project complexity, app development charge of a different app development team, etc.
3. How do I create a trading app?
Follow the given steps to build your trading app:
- Do your market research
- Get a business license by following the regulations
- Hire a development team
- Decide the app features you want to include
- Choose the best app design for better UX
Pick the right technologies for app building - Build your trading app
- Publish your trading app
