Trading platform Robinhood is growing — up to 10 million users — and is not just made up of wet-behind-the-ears gamblers and sports bettors, a new survey from CivicScience shows.
- More than half of Robinhood users describe themselves as either long-term or 401(k) investors.
What it means: Retail traders broadly have been looked at with skepticism and scorn by much of the investment community, and Robinhood users, especially, are seen as capricious and naively bidding up trend stocks. However, the data show most of the platform's users aren't active traders.
Where it stands: The company recently raised $200 million for an $11.2 billion valuation based on its explosive growth and it may have further to go.
- CivicScience found that just 8% of Americans say they use or intend to use Robinhood while 72% say they have never heard of it. Another 20% say they are not interested.
Yes, but: The company's reputation has been damaged by a series of crashes and errors that prevented users from making trades on its app on some of the most important days of the year.
Background: Robinhood grew to prominence because it was one of the first platforms that allowed users to trade stocks with no fees and provided fractional shares, meaning users could purchase stock in pricey tech companies like Amazon, Apple or Tesla even if they didn't have enough money to buy a full share.