4 ms·
Robinhood is launching a 3% interest savings account
- fullshark 8y agoSo they won’t make money on this and admit they are buying users. Seems like a bad idea and makes me question their solvency in the future.
- tschwimmer 8y agoThis feels like FinTech Moviepass. I understand how they monetize their brokerage trades but how are they going to make money on this?
- SEJeff 8y agoThey put excess money from brokerage accounts in treasury bonds (And get to keep the returns from that) in addition to robinhood gold. I suspect much of their money is made my selling their order flow to big banks along with robinhood gold. This also makes it much easier for them to hawk their brokerage services to those who already have money in their checking accounts.
- xxpor 8y agoI've been keeping my emergency savings in VMSXX (vanguard's Muni bond money market) for a while now since on a tax equivalent basis, the yield (for me, it depends on your income and state) is roughly 2.5-2.6%. Maybe I'll switch to this. My question is though: how the heck are they doing it, and is it sustainable?
- slumberlust 8y agoIt's a subsidy to grow their user base. Think selling gaming consoles at a loss to accrue a user base that buys more games.
- andy-x 8y agoI presume not FDIC-insured.