Robinhood announced
today (Monday) the launch of margin investing for its UK customers, allowing
retail traders to borrow money. The move comes just months after the company’s
initial entry into the British financial market.
Robinhood Unveils Margin
Investing Rates for The UK Customers
The new
margin investing feature allows UK customers to borrow money from Robinhood
using their existing portfolio as collateral, enabling them to purchase
additional securities and potentially diversify their investments. Rates for
approved customers range from 6.25% for balances up to $50,000, decreasing to 5.2%
for balances exceeding $50 million.
“With
the launch of margin investing, we’re giving our UK customers even more
flexibility and tools to enhance their investing strategies,” Jordan
Sinclair, President of Robinhood UK, emphasized the company’s commitment to
empowering retail investors. “At Robinhood, we understand that investors
want access to expand and diversify their portfolios at industry-leading rates,
in an amazing user experience.”
Sinclair added in an interview with CNBC that the firm needed to ensure the local regulator was “comfortable” with its approach in order to receive approval for launching margin investing in the country.
The
introduction of margin investing follows Robinhood’s UK app launch in March. The company offers commission-free trading, no foreign exchange fees and also additional
protections, including $2.5 million in FDIC insurance on uninvested cash
through its Brokerage Cash Sweep Program.
Robinhood to Disrupt Local
Market
Robinhood’s
move into margin investing in the UK market could potentially disrupt
traditional brokerage firms, which often impose higher fees and reserve
competitive rates for high-net-worth individuals. A
step in this direction was also taken last week with the introduction of index
options and futures trading to its platform in partnership with Cboe.
However,
Robinhood faces significant competition in the local market. The UK-based
Revolut is popular across Europe, and earlier this month, Freetrade
strengthened its position in the increasingly competitive retail investing
market by acquiring Stake’s UK arm.
The company
emphasized that margin investing access is not automatic and requires customers
to apply and meet eligibility requirements. “Once a customer is approved to
trade with margin, their rate is automatic based on the margin loan balance of
their account,” the company commented in
a statement.
Robinhood
has begun rolling out the margin investing feature on Monday, with broader
availability expected in the coming weeks. Customers can apply for access
through the company’s mobile app.
Robinhood announced
today (Monday) the launch of margin investing for its UK customers, allowing
retail traders to borrow money. The move comes just months after the company’s
initial entry into the British financial market.
Robinhood Unveils Margin
Investing Rates for The UK Customers
The new
margin investing feature allows UK customers to borrow money from Robinhood
using their existing portfolio as collateral, enabling them to purchase
additional securities and potentially diversify their investments. Rates for
approved customers range from 6.25% for balances up to $50,000, decreasing to 5.2%
for balances exceeding $50 million.
“With
the launch of margin investing, we’re giving our UK customers even more
flexibility and tools to enhance their investing strategies,” Jordan
Sinclair, President of Robinhood UK, emphasized the company’s commitment to
empowering retail investors. “At Robinhood, we understand that investors
want access to expand and diversify their portfolios at industry-leading rates,
in an amazing user experience.”
Sinclair added in an interview with CNBC that the firm needed to ensure the local regulator was “comfortable” with its approach in order to receive approval for launching margin investing in the country.
The
introduction of margin investing follows Robinhood’s UK app launch in March. The company offers commission-free trading, no foreign exchange fees and also additional
protections, including $2.5 million in FDIC insurance on uninvested cash
through its Brokerage Cash Sweep Program.
Robinhood to Disrupt Local
Market
Robinhood’s
move into margin investing in the UK market could potentially disrupt
traditional brokerage firms, which often impose higher fees and reserve
competitive rates for high-net-worth individuals. A
step in this direction was also taken last week with the introduction of index
options and futures trading to its platform in partnership with Cboe.
However,
Robinhood faces significant competition in the local market. The UK-based
Revolut is popular across Europe, and earlier this month, Freetrade
strengthened its position in the increasingly competitive retail investing
market by acquiring Stake’s UK arm.
The company
emphasized that margin investing access is not automatic and requires customers
to apply and meet eligibility requirements. “Once a customer is approved to
trade with margin, their rate is automatic based on the margin loan balance of
their account,” the company commented in
a statement.
Robinhood
has begun rolling out the margin investing feature on Monday, with broader
availability expected in the coming weeks. Customers can apply for access
through the company’s mobile app.
This post is originally published on FINANCEMAGNATES.
