Do Discount/App Brokerages Still Make Sense?

Not to quibble - but having just read this (…ounts/system-rigged/) - I think it’s worth asking…

Does it still make sense to consider the Stash/Acorns/Robinhood class for small, self-directed brokerage accounts?

Once upon a time - as recently as just a few years ago - I think the case was easy… zero/low minimums to open the account… ability to trade buy/trade fractional shares. If you didn’t have 5-10k to start with - sure.

I’m a pretty conservative investor - and a fee hawk to boot. This means that 1)I’m certainly not involving myself in option chains, much less any margin-based trading or other exotics, 2)I’m a buy-and-hold guy - not a day trader, and 3)above all, if you aren’t beating the S&P 500 – you ought to just be in ETFs.

Fintech has done great things for the small dollar investor - I started years ago with Wealthfront, FWIW… but I’m not sure it mattered much that I picked Wealthfront over Betterment - it just so happened that WF had a better offer than BM at the time. I had a reasonable bonus to invest, so I let WF’s lovely little robots handle it across a portfolio of auto-managed ETFs.

Eventually - about 3 years ago - I decided to dip my toes in a brokerage account where I’d dive into individual equities. I had started paper/what-if tracking, learned how to read a 10-K, etc - and thought I was prepared to start trying to beat my robo-returns.

At the time - I looked at the options… I considered the online brokerages that were once nextgen (E*Trade, TD Ameritrade). I looked at the then-startups - Stash and Robinhood.

But - I ultimately went with Fidelity. They had - then, just recently - cut their minimum to 0… they didn’t (then) offer fractional shares, but…well, now they do.

A couple years in, now – I’m struggling to see why one would pick Stash/Robinhood/etc over the “old stalwarts” (not just Fidelity, but it looks like Schwab and Merrill and etc) pretty much match all the startups on offers. No minimums. No fees. Fractional share trades. But - most importantly, NO recurring fees or monthly charges. About 2.5 years in - the only fee I’ve paid on anything in my Fidelity account are a few pennies on some fractional share reinvestments on some equities I bought on foreign exchanges (fees I was well aware of when I bought into those individual stocks and decided to reinvest the dividends).

Once upon a time, I think the new guns made sense- lower minimums, zero fees, fractional shares… but it just seems to me like the “stalwarts” have aggressively matched them - and, in many ways (like no recurring account fees), are beating them.

FTR - I have no “relationship” with Fidelity other than the fact that I have an account with them. Don’t work for them, don’t have any (direct - I imagine one of my ETFs might have positions) investments in them - just an account. Well, technically - 2 accounts; they also manage my employer 401k (which was the main reason I bothered checking on their brokerage options - I liked their resources in my work plan).

I’m willing to be convinced that I’m missing something - and I can only speak for Fidelity (but online comparisons seem to indicate it’s the same with Schwab, Merrill, et al)… The only difference I see is that with Stash/etc – I’d be paying somewhere in the neighborhood of $12 to $100+ a year in fees.


I used Robinhood, Acorns, WeBull, etc for awhile. Mostly to get their free stock offer and test their tools and whatnot, but I always came back to my Schwab account. I think a lot of folks get hung up in those because they like the hype that those companies throw out there. (A lot of “day trade” type activities can be intoxicating) The traditional houses like Schwab, Fidelity,TD and such offer free trades now as well and focus more on the stability of long term investing. The trades on the new platforms are slower to clear but I do like alot of the stock vision tools they have. I know not everyone has the same view of it and always enjoy the discussion.

Side note: I really wish Schwab would hurry up and adopt the aesthetics of TD. Schwabs reports and layout are very outdated and cluttered.


While – besides a short-lived stint with Robinhood during the GME frenzy – I haven’t tried any of “new” apps for investing, I do have accounts with TD Ameritrade (Charles Schwab), E-Trade (Morgan Stanley), Principal, Fidelity and Vanguard… So I’m not rushing to create any new accounts with other companies.

But I have to say TD Ameritrade is my go-to for individual stocks and Vanguard my go-to for my Roths and 401k rollovers. Between those two, all my needs are met just fine.

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Thanks, @cycloned and @will.s - appreciate the perspectives.

And to re-emphasize, by no means do I meant to give the fintech startups like Stash (or Robinhood or etc) the stinkeye – indeed, though I don’t use them, I’m certainly appreciative of the fact that they (together with their precursors) essentially caused the old brokerage stalwarts to adopt more small-investor friendly account models… but hey, money is money, right? At the end of the day, I want secure, reliable, and most cost-effective platforms.

The research, tracking, charts dashboard question is an interesting one - I knew going into Fidelity that they were laggard. They’ve improved - improved quite a lot, actually - in just the few brief years I’ve used them but I have no doubt that they’re still below par (at least, in organization… there’s plenty of value and information, it’s just not what I’d always call easy or intuitive to get at).

I suppose, that said, I’m still ultimately a buy-and-hold, conservative investor and I’ll generally trend towards spending days, even weeks, noodling over filings, revenue, outlook, etc over and above specific price point chart watching. Know thyself and don’t try to be what you’re not, I guess.

Would I be willing to pay a premium for a platform that’s more user friendly, clean, and neat? It’s a good question…


@zonk1984 Yes, agree it’s nice that the fintech startups are innovating the investor experience, forcing the old guards to adjust to new competition and improve their products.

thank you for sharing its always a great way to help people like me do the right thing have a great day