Charles Schwab and Robinhood are two of the most popular brokerage firms, where customers can buy and sell stocks, options, exchange-traded funds and more. Millions of people rely on these names to help them access the market, track investments, and research stocks, among other things.
Charles Schwab has a long-earned reputation as an investor-friendly broker who helps smaller investors using a range of research and tools. It regularly ranks high in Bankrate’s ratings of the best in the industry, and it took home Bankrate’s award for best overall broker in 2023.
But Robinhood has taken the investing community by storm over the past decade and has quickly become the name many think of when they think of mobile trading. It has been a boon to many investors because of its support for fractional shares and low trading costs, especially for options.
So which is better for you? This comes down to the properties of the broker, but also to what you really need from a broker. Here’s how they stack up with the most important features.
| Broker category | Charles Schwab | Robinhood |
|---|---|---|
| Stock and ETF commissions | $0 | $0 |
| Option committees | $0.65 per contract | $0 per contract |
| Minimum account | $0 | $0 |
| Marketable securities | Stocks, ETFs, bonds, investment funds, options, futures | Stocks, ETFs, options, cryptocurrency |
| Account fees | $50 transfer fee | Transfer fee of $100 |
| Investment funds without transaction costs | ~4,300 | No |
| Account types | Individually and jointly taxable, IRAs, small businesses (SEP IRA, solo 401(k), etc.), managed portfolio, custodial, charity, and trust, among others | Individual taxable accounts, IRAs (traditional, Roth and rollover) |
| Mobile app | Schwab mobile app on the Apple App Store and Google Play Store | Mobile app in the Apple App Store and Google Play Store |
| Fractional shares | Stock slices – for purchases and dividend reinvestment | For purchases and reinvestment of dividends |
| Customer support | 24/7 telephone, chat and email, more than 300 locations | Email, chatbot and 24/7 call back |
Schwab vs. Robinhood: Fees
It’s a dead end in several cost areas, but Schwab outpaces its rival overall.
Both Schwab and Robinhood offer commission-free stocks and ETFs (but so does every other major online dealer). Robinhood stands out for its fee-free options trading, a true rarity in the industry and something that an options trader may find especially rewarding. Schwab can’t match it and instead offers the industry standard commission of $0.65 per contract.
That said, Schwab offers something that Robinhood doesn’t: some 4,300 mutual funds with no transaction fees. That’s a solid offering too, and Robinhood doesn’t offer any mutual funds at all.
And when it comes to other reimbursements, Schwab is again at the forefront. There is a $50 transfer fee when you move securities, compared to Robinhood’s $100.
Edge: Schwab
Schwab vs. Robinhood: Account Minimum
Since neither account has a minimum balance requirement, it’s easy for any investor to get started with either broker. No account minimum is a hallmark of the best brokers for beginners.
Edge: Even
Schwab vs. Robinhood: Tradeable Securities
Here’s one place where Charles Schwab surpasses Robinhood for the breadth of its offerings.
At Schwab you can trade a number of different securities, including stocks, bonds, options, ETFs, mutual funds and futures. It’s a broad selection that gives investors plenty of access to the most popular investment types, enough to satisfy almost all investors.
Robinhood still offers a solid core of available investments — stocks, ETFs and options — but not other popular types like mutual funds. Its differentiator is that it offers cryptocurrency trading in addition to its other securities, something most traditional brokers do not do.
So if you want a broader selection of securities, Schwab makes the better choice, while if you want the core with the addition of crypto, Robinhood is your winner.
Edge: Schwab, for its broader selection of traditional securities
Schwab vs. Robinhood: Account Types
In terms of account types, there is little competition between Schwab and Robinhood.
Schwab offers all the basic types: individual and joint taxable accounts, IRAs (traditional, Roth and rollover), custodial accounts, business accounts and trust accounts, among other less typical types. If you’re looking for a managed portfolio, Schwab offers one through its robo-advisor service Schwab Intelligent Portfolios at no additional cost. It’s quite a range.
Robinhood, on the other hand, offers individual taxable accounts and has just started offering IRAs (traditional, Roth, and rollover). The broker actually has a nice bonus feature for its IRAs, giving you a 1 percent bonus on the money you bring to the table, including for rollovers.
If you want to do more with your broker than what Robinhood offers, you should go elsewhere.
Edge: Schwab
Schwab vs. Robinhood: Fractional Shares
When it comes to fractional shares, Robinhood clearly outpaces Schwab.
Robinhood is an excellent choice if you plan to invest in fractional shares. Not only can you place orders for fractional shares, but you can also reinvest any dividends in fractional shares. You don’t see that combination with many brokers, only the best for fractional shares. At Robinhood, you can buy fractional shares for as little as $1, and the range of stocks available is huge — all but the smallest stocks and those trading for less than $1 — to keep the riffraff out.
You can buy fractional shares as part of Schwab’s Stock Slices program, but the range of stocks supported is smaller: only the 500 or so names in the S&P 500 index. You must invest at least $5 for each purchase, and you can buy up to 30 shares at a time, making it a fairly easy-to-use interface if you want to buy a lot of shares at once (unlike Fidelity’s interface.) However, reinvest your dividends in other stocks that pay them.
So Schwab’s fractional share program is quite broad, but not as broad as Robinhood’s.
Edge: Robinhood
Schwab vs. Robinhood: Customer Support
Schwab’s customer service is one of its strongest points, and it really is that good.
Schwab regularly receives high marks for its helpful and friendly customer support. You can reach a person in a minute without getting lost in the phone maze. Schwab has 24/7 support via phone, chat and email, and you can still go to any of the more than 300 branches. In our experience, customer service is as good as you can reasonably expect.
Robinhood recently upgraded its support, from what used to be essentially a self-help page, email support, and a deeply hidden phone number. Now you get this plus 24/7 call back support for your problem. You leave your concern and Robinhood will contact you within 24 hours. It’s certainly a better world than before, but Schwab is really at the top of this game. As an app, Robinhood obviously does not offer a branch network if you have that pressing question.
Edge: Schwab
In short
Considering it’s an upstart with pockets not nearly as deep as its rival’s, Robinhood is doing surprisingly well in a handful of categories, compared to the well-funded and highly experienced Charles Schwab. But Schwab is ultimately too polished in too many categories and requires an investor-friendly approach to much of what it does. Still, those looking for a specific feature such as free options trading may find Robinhood a more suitable choice.
