Topline
Robinhood will soon allow users to engage in 24-hour trading of selected exchange-traded funds and popular stocks such as Apple and Tesla, the company announced Wednesday—which will make it the first U.S. brokerage to provide overnight weekday trading in individual stocks.
Robinhood will launch its new trading feature in full next month. (Photo Illustration by Thiago … [+]
Key Facts
The 24-hour trading service will allow round-the-clock trading in 43 securities between 8 p.m. ET Sunday and 8 p.m. ET Friday, with plans to add more securities at a later time, Robinhood CEO Vlad Tenev told the Wall Street Journal.
The feature will roll out next week in a limited capacity and will be available by June to all users, according to the Journal.
Robinhood competitors such as E-Trade and TD Ameritrade allow overnight trading for a limited number of exchange-traded funds.
Key Background: Geared toward younger investors with a simple user interface, Robinhood’s move to expand trading hours could draw retail traders to its app. The company gained popularity in the midst of 2021’s retail trading frenzy. But Robinhood has drawn criticism for its approach, with allegations it gamifies investing and allows users to trade options that they may not understand. Some users also criticized Robinhood for halting trading in some meme stocks like GameStop in early 2021, which the company blamed on volatility.
Tangent: News of the 24-hour trading service’s launch coincided with the release of Robinhood’s 2023 first quarter earnings. The company posted $441 million in revenue and negative $0.57 in earnings per share for the first quarter this year. Net interest revenue increased 25% sequentially to $208 million, according to the first quarter earnings report. The company plans to launch brokerage services in the U.K. by the end of this year. Robinhood shares increased more than 2% in extended trading Wednesday after closing at $9.07 per share.
Surprising Fact: Robinhood has raised a total of $6.2B in more than 28 funding rounds.
Further Reading:
Robinhood to Launch 24-Hour Trading on Weekdays in Stocks and ETFs (The Wall Street Journal)
Robinhood beats revenue estimates as rate hikes bolster interest income (Reuters)
Source: https://www.forbes.com/sites/antoniopequenoiv/2023/05/10/robinhood-launching-24-hour-weekday-stock-trading/