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Bottom line: Robinhood is best for DIY traders who value low fees and flexible investment options. Acorns Invest better serves hands-off investors who prefer automated portfolio management and don’t mind having access to one investment type: ETFs.
Robinhood vs. Acorns: The biggest differences
Robinhood and Acorns both offer multiple products and account options for retail investors. You can invest in ETFs with either platform, and both companies provide spending perks and investing round-up features.
But Robinhood is the best choice for DIY traders who want exposure to stocks, ETFs, cryptocurrencies, American Depositary Receipts (ADRs), and options. Plus, Robinhood’s simple web and mobile interfaces — in addition to its educational content on investing topics — could make it a great choice for beginners who’ve just gotten into self-directed trading.
Robinhood also has Acorns beat when it comes to fees. You’ll pay $3 or $5 per month, depending on the plan you select. You won’t pay any trading fees at Robinhood.
You should choose Acorns Invest if you’re in search of automated portfolio management, banking perks, and access to IRAs and custodial accounts.
Robinhood and Acorns’ features and account options also vary.
Robinhood
Acorns
Account types
Individual brokerage accountsCash management accountsMargin accounts
Account types
Automated personal investmentTraditional IRAsRoth IRAsCustodialChecking/online banking
Investment choices
Stocks, ETFs, options, cryptocurrencies, IPOs, and ADRs
Investment choices
ETFs
Account perks
Commission-free tradingFractional sharesNo-contract-fee optionsCrypto tradingCash management accountsMargin tradingMorningstar research and Nasdaq data
Account perks
Acorns Round-Ups invests spare change from purchases into more securitiesAcorns Later automates retirement investingMoney Basics blog with educational content on investing, taxes, retirement, and moreAcorns Earn’s Found Money portal gives you investment rewards when you shop at 350 retailers Acorns has partnered with
Human advisors available?
No
Human advisors available?
No
Robo-advice?
No
Robo-advice?
Yes — Acorns manages your investment portfolio for you
Is Robinhood right for you?
Pros
Commission-free stocks, ETFs, options, and cryptocurrencies; options have no contract feesRobinhood Gold members get 3% interest on uninvested cash; non-Gold users get 1.5% APY on uninvested cashIPO investing, fractional shares, and margin trading availableWebsite is easy to navigate; advanced charts for all users
Cons
No retirement accounts, joint accounts, education savings accounts, or mutual fundsCan only take advantage of professional research if you’re a Robinhood Gold member
Robinhood caters to several types of retail traders: active traders, day traders, options traders, and crypto traders. Plus, the brokerage offers a completely commission-free fee model, meaning you won’t pay to trade stocks, ETFs, options (these come without contract fees), ADRs, or cryptocurrencies.
In addition, you can invest in fractional shares with a minimum of $1. Robinhood Gold, its advanced trading subscription level, gives you access to larger instant deposits (you can deposit up to $50,000), margin trading, advanced market research, and 3% interest on uninvested cash.
When it comes to crypto trading, Robinhood currently supports 17 cryptocurrencies. These include bitcoin, ethereum, avalanche, dogecoin, and more. And, as mentioned earlier, you can completely skip out on trading fees with these assets. Plus, you’ll be able to transfer crypto in and out of your account, and the exchange is launching a Web3 wallet that will remove network fees when trading or swapping crypto (you can sign up for the waitlist here).
Robinhood also offers several resources to help beginners get more acquainted with market knowledge. It provides an entire digital library on all things investing, with a section dedicated to options trading.
Is Acorns right for you?
Pros
No account minimums; commission-free ETFsAcorn Round-Ups invests your spare change from purchasesETF portfolios are tailored to your risk tolerance and investment goals; can allocate up to 5% of your portfolio toward a bitcoin ETFAutomated custodial investment accounts for kids
Cons
You can’t invest in specific companies; Acorns manages your portfolio for youMonthly fees are high compared to other automated advisors like SoFi and Ally Invest Robo Portfolios
Acorns Invest is an automated investing account that best serves hands-off investors in search of portfolio management for IRAs and personal investment accounts. The platform also offers several banking perks (including a checking account, check deposit, direct deposit, access to 55,000+ ATMs, and more), and it invests spare change from purchases you make with its Acorns Visa debit card.
You’ll have two accounts to choose from: Acorns Personal and Acorns Family. The Acorns Personal account costs $3 per month and includes access to personal investment accounts, IRAs, banking, and bonus investments. You’ll pay $5 per month with the family plan, but you’ll have all of the features of Acorns Personal in addition to custodial accounts. With either account option, you’ll be able to take advantage of automatic dividend reinvesting, automatic portfolio rebalancing, and automatic recurring investments.
But Acorns falls short when it comes to its investment selection. Acorns only offers ETFs. The ETF offering is common among robo-advisors, but you won’t have as much flexibility as you would with Robinhood. However, Acorns recently added a bitcoin ETF, Proshares Bitcoin Strategy ETF (BITO), to its offerings, and you can allocate up to 5% of your portfolio in that asset. This launch adds Acorns to the list of other robo-advisors (e.g., Betterment and Wealthfront) that offer crypto exposure.
When it comes to retirement accounts, Acorns offers Roth IRAs, traditional IRAs, and SEP IRAs. The platform creates your retirement portfolio based off your age, and it automatically rebalances it to keep it on track until you’re 69 years old.
The robo-advisor additionally offers socially responsible investing portfolios, as well as custodial accounts. Therefore, it bests Robinhood when it comes to both areas, given that Robinhood neither offers impact investing nor investing options for minors.
Robinhood vs. Acorns — Frequently asked questions (FAQ)
Is Acorns better than Robinhood?
Acorns Invest and Robinhood offer different types of services. Acorns is best for those who want their portfolios managed and rebalanced for them. Robinhood, on the other hand, best suits DIY traders.
When it comes to overall investment selection, Robinhood is the better choice. You’ll be able to trade stocks, ETFs, options, ADRs, and cryptocurrencies. You’ll only have access to ETFs at Acorns.
Acorns, however, is the stronger choice for socially responsible investing and custodial accounts.
Can you use Acorns and Robinhood?
You can’t transfer stocks from Robinhood to Acorns. Acorns doesn’t allow this from Robinhood, nor any other investment platform. However, if you want to dabble in both DIY trading and automated investing, you can set up both a Robinhood account and an Acorns account.
What is the downside to Acorns?
Acorns doesn’t offer self-directed trading, nor does it allow you to modify the allocation of ETFs in your portfolio. In addition, given that some robo-advisors don’t charge advisory fees, its monthly fees might be a drawback for those looking to minimize costs.
What are the cons of using Robinhood?
Robinhood doesn’t offer mutual funds, IRAs, custodial accounts, joint accounts, or education savings accounts.