Bernstein says Robinhood wants to be an auto-mutual fund
In a new report, investment research firm Bernstein argues that trading app Robinhood is trying to become an "auto-mutual fund" by allowing users to invest in the stock market with minimal effort.
“They are trying to make it easier for people to invest, but at the same time, they are making it less interesting and less engaging,” said a Bernstein analyst.
The report highlights how Robinhood's "no-frills" approach to investing, which includes features such as dollar-cost averaging and automatic investments, can make it easier for users to invest in the stock market without having to put in a lot of effort.
“The goal is to make investing more accessible and easier to do, but also to make it more like a mutual fund, where you can just invest and forget about it,” said a Robinhood spokesperson.
However, Bernstein notes that this approach can also make it harder for users to take more control over their investments and make more informed decisions.
“The more you automate the investing process, the less you are in control of your investments,” said a Bernstein analyst.
Resumen:
Robinhood's approach to investing is designed to make it easier for users to invest in the stock market, but it may also make it harder for them to take control of their investments and make more informed decisions. This raises questions about the balance between accessibility and control in investing.