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Link to their blog post instead - https://blog.robinhood.com/news/2018/12/13/introducing-robinhood-checking-amp-savings https://blog.robinhood.com/news/2018/12/
by vthallam 8y ago
Link to their blog post instead - https://blog.robinhood.com/news/2018/12/13/introducing-robinhood-checking-amp-savings https://blog.robinhood.com/news/2018/12/13/introducing-robin...
- ikeboy 8y ago>With Robinhood, you’ll earn 3% on your money in both Checking & Savings, and interest compounds and is paid out daily. That’s an extra $240 a year for the average American household with $8,000 in the bank Does not compute. If it compounds daily then yearly total is above 3%
- tedd4u 8y agoMaybe it's a daily interest rate of 1.03^(1/365)-1 ?
- rexaliquid 8y agoIt's standard to talk in annualized interest rates to make simple comparisons between accounts. A daily interest rate of 0.008 % will compound up to just over 3 % of effective annual rate.
- ikeboy 8y agoIf the daily interest rate is 0.008 then the annualized rate is 2.92%, not 3%. The standard is to multiply by the number of periods, not to take compounding into the calculation.
- talltimtom 8y agoWhy would the standard be to calculate a number that has no use and isn’t rooted in reality? If the rate is 3% annually and paid out daily, the the daily rate is the number that compounded yields 3% annually....
- ikeboy 8y agoBecause it makes it easy to calculate how much is distributed. Just take the annual rate, divide by number of periods, and multiply by the amount of principle.
- rexaliquid 8y agoThat's true of the nominal rate. A nominal 3% divides to an effective daily rate of 0.0082 %. But the effective rate is (1 + Nominal Rate / n)n - 1 or just over 3.2%.
- mrnobody_67 8y agoI wonder if they will cut off people who deposit 7 figures.
- talltimtom 8y agoMight just put a cap. I have a 5% account which sounds awesome, but it’s caped at 8000$ and then goes to zero.
- shadowoflight 8y agoThe accounts are only insured to $250k, so putting in 7 figures could be risky.