SoFi vs. Robinhood: New Players, New Game

SoFi vs. Robinhood: New Players, New Game

While many newer traders and investors came into the game mid-pandemic and have been used to low/no-commission trading fees, it wasn’t always like that. Far from it. For decades, and especially since the inception of retail trading, new players or investors were hit by constant fees for every transaction.

  1. Buying fees.
  2. Selling fees.
  3. Commission fees.
  4. Online “convenience fees.”

It was crippling – Thankfully, advances in technology allowed two leading players to enter the market and offer low/no-commission fees and a new, accessible way for the everyday guy to access the market and make money like the big players.

These two publicly traded services approach accessible investing from two different directions. One targets the newer or less-active trader and one focuses on those that want to trade themselves and likely have a bit more knowledge or experience under their belt.

Enter: Robinhood and SoFi


Robinhood is the oldest and most well-known platform for retail traders. Started in 2013, Robinhood brought easy investing to the retail class through a slick app and immediate access to basic stock and ETF trades as well as options, with crypto following later. Unfortunately, there is controversy with Robinhood over trading halts and liquidity issues during the Gamestop era.

Controversy aside, what are the features of Robinhood?

The main features are trading options, a decent app interface, and a no-fee structure. Although there is a $5 premium option that increases margin allowance. The margin charges interest at an industry-low 2.5%.

Recently, Robinhood also introduced access to initial public offerings in addition to crypto trading. This has always been the realm of central banking institutions and firms, and this access adds a new dimension to Robinhood’s quality offerings.

The biggest downsides?

There isn’t a whole lot of support for new users or novices. With immediate access to complex options strategies and margins, users can (and have) get into financial trouble. While fault lies with the user, most if not all of the major brokerages require screening to access these tools. Robinhood has a paltry educational and research arm, although it is improving with analyst ratings and earnings calendar inclusion.

In short, Robinhood is great for a trader with a few years of experience. However, it may not necessarily be good for a brand new trader looking to learn the market.


SoFi began as a platform called SoFi Invest for students to refinance burdensome student loans into a better-term arrangement. Over time, SoFi evolved to include financial support outside of loan management to include stocks, ETF, and options trading, mortgage management, and crypto. Like Robinhood, SoFi offers low and no-fee trades, which makes it attractive to the retail investor class.

In addition to the basics that SoFi and Robinhood share, SoFi offers access to certified financial planners at no cost to the user. They also offer “set it and forget it” long-term investor options using robo-advising options.

What is Robo-Advising?

Robo-advisor firms will use proprietary, advanced algorithmic, and quantitative methods to determine the best investments and trades for your portfolio.

Generally, an investor will set a risk tolerance level, among other factor inputs. The AI can then buy and sell equities using that risk level and its algorithmic analysis.

SoFi’s robo-advisor services are seen as an industry leader, and the system does it all. It is great for brand new investors and those with a busy lifestyle. The system determines your preferences and strategies before managing your portfolio. All hands-free.

The Bottom Line

Both services are exciting, revolutionary, and game-changing for new players looking to take charge of their finances and gain independence.

So which is best?

For someone wanting complex options plays and intending to be very active in trading, Robinhood has a slight edge. But, only because those are immediately available. Thus, if you know what you’re doing, you can start immediately.

SoFi offers the same strategies and products. However, the twist is that they are friendly to both those with experience and without. This makes them the winner. Especially as the complimentary access to financial planning experts and robo-advising services round out an already spectacular offering set.

Ready to get started?

We recommend looking into SoFi first – they’re most likely to meet your needs irrespective of your experience level.

If you’d prefer Robinhood, you can get started here.

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