Robinhood does not offer mutual funds, but you can buy exchange-traded funds (ETFs) that work similarly

Robinhood's platform is built around individual stocks and options, not mutual funds. If you search for a mutual fund by name on Robinhood, you will not find it. However, Robinhood does offer exchange-traded funds (ETFs), which are baskets of stocks or bonds that trade like individual stocks and often track the same indexes that mutual funds do.

The practical difference matters: mutual funds are priced once per day after the market closes, while ETFs trade throughout the day at changing prices. Mutual funds often have minimum investment amounts and higher fees. ETFs on Robinhood have no minimums and typically charge lower annual fees. For most people building a diversified portfolio on Robinhood, an ETF will do what a mutual fund would do, but with more flexibility and lower cost.

If you already own mutual funds elsewhere and want to move them to Robinhood, you cannot transfer them directly. You would need to sell them in your current account, move the cash to Robinhood, and buy ETFs there instead. That triggers a taxable event if the funds are in a regular brokerage account, so check with a tax professional before moving large positions.

Key Takeaways

  • Robinhood does not support mutual fund purchases, but ETFs provide the same diversification benefit with lower fees and no minimum investment.
  • ETFs trade throughout the day like stocks, while mutual funds are priced once daily, giving you more control over when you buy and sell.
  • You can search for ETFs by ticker symbol on Robinhood and buy fractional shares starting with any dollar amount.
  • Moving mutual funds from another brokerage to Robinhood requires selling them first, which may trigger taxes if held in a taxable account.
  • Robinhood's ETF selection includes broad market funds, sector-specific funds, and bond funds that cover most investment strategies.

What ETFs are available on Robinhood

Robinhood offers thousands of ETFs covering most common investment categories. You can find broad market ETFs like VOO (Vanguard S&P 500 ETF) and VTI (Vanguard Total Stock Market ETF), which track large portions of the U.S. stock market. Bond ETFs like BND (Vanguard Total Bond Market ETF) and TLT (iShares 20+ Year Treasury Bond ETF) are available for fixed-income exposure. Sector ETFs let you focus on specific industries—XLK for technology, XLE for energy, XLV for healthcare.

International stock ETFs like VXUS (Vanguard Total International Stock ETF) and emerging market funds are also there. The selection is broad enough that most investors can build a diversified portfolio without ever buying an individual stock. You search by ticker symbol, not fund name, so knowing the ticker ahead of time saves time. Financial websites like Yahoo Finance or your current brokerage can give you the ticker for any ETF you are considering.

How ETFs work differently from mutual funds

The biggest practical difference is trading throughout the day. When you buy a mutual fund, your order sits until the market closes, then you get one price for all shares purchased that day. With an ETF, you see the price change in real time and can buy or sell at any moment the market is open. If the market drops 2% in the morning and you want to buy, you can. If you need cash and want to sell before the close, you can do that too.

Mutual funds often charge higher annual fees (called expense ratios) because they employ managers to pick holdings. Most ETFs are passively managed, meaning they simply hold the same stocks as an index, so fees are lower—often 0.03% to 0.20% per year instead of 0.5% to 2%. Over decades, that difference compounds significantly. ETFs also do not require minimum investments, so you can start with $1 or $100. Robinhood lets you buy fractional shares, meaning you can own a piece of an expensive ETF even if you have limited cash.

One small drawback: mutual funds sometimes let you reinvest dividends automatically at no cost. ETFs on Robinhood pay dividends in cash to your account, and you have to manually buy more shares if you want to reinvest. This is a minor inconvenience, not a deal-breaker.

Building a portfolio with ETFs instead of mutual funds

A simple three-fund portfolio—one U.S. stock ETF, one international stock ETF, and one bond ETF—covers most of what a balanced mutual fund would do. For example: 60% VOO (U.S. stocks), 20% VXUS (international stocks), and 20% BND (bonds). You could set this up with $100 and add to it over time. Robinhood charges no commission on ETF trades, so adding money monthly costs nothing.

If you want to be more hands-off, look for target-date ETFs like VFIAX or similar funds that automatically adjust from stocks to bonds as you approach retirement. These work like target-date mutual funds but trade like ETFs. You pick one based on your expected retirement year, buy it, and let it rebalance itself.

The key is deciding your allocation (how much stocks versus bonds, how much U.S. versus international) before you start. That decision matters far more than which specific ETF you pick. Once you have decided, stick with it and add money regularly rather than trying to time the market.

Tax implications of switching from mutual funds to ETFs

If you own mutual funds in a regular taxable brokerage account and sell them to buy ETFs on Robinhood, you owe capital gains tax on any profit. If you bought a mutual fund for $5,000 and it is now worth $7,000, selling triggers a $2,000 taxable gain. That tax bill is due in the year you sell, regardless of whether you reinvest the money immediately.

If your mutual funds are in a retirement account—a 401(k), traditional IRA, or Roth IRA—you can move them without tax consequences. You can transfer the account itself to Robinhood (if Robinhood supports that account type) or withdraw the cash and roll it into an IRA at Robinhood. Check Robinhood's documentation to see which retirement account types they support; not all brokers offer every option.

For new money going forward, there is no tax advantage to ETFs over mutual funds—both are taxed the same way. The advantage is purely in fees and flexibility. If you are starting fresh on Robinhood, just buy ETFs and do not worry about the mutual funds elsewhere until you have a reason to move them.

When you might still want mutual funds elsewhere

Some situations favor keeping mutual funds outside Robinhood. If you have a 401(k) through your employer, you are probably limited to the mutual funds your plan offers—you cannot use Robinhood for retirement contributions anyway. If you have a large mutual fund position with significant unrealized gains, selling it to switch to an ETF might not be worth the tax bill. If you prefer automatic dividend reinvestment or want a fund manager actively picking stocks, mutual funds offer that (though it costs more).

For most people building wealth over time, though, ETFs on Robinhood are simpler and cheaper. You get diversification, low fees, no minimums, and the ability to trade during market hours. That covers what mutual funds do for most investors, without the friction.

Frequently Asked Questions

Can I transfer a mutual fund I own to Robinhood?

No, you cannot transfer a mutual fund directly. You must sell it in your current account, move the cash to Robinhood, and buy an ETF there. If the mutual fund is in a taxable account and has gains, you will owe capital gains tax on the sale. If it is in a retirement account, you can transfer the account itself or roll the cash into a Robinhood IRA without tax consequences.

What is the cheapest ETF to buy on Robinhood?

Robinhood charges no commission on any ETF trade, so cost depends only on the fund's annual expense ratio. VOO (Vanguard S&P 500 ETF) and VTI (Vanguard Total Stock Market ETF) both charge around 0.03% per year, among the lowest available. You can compare expense ratios on any financial website before you buy.

Do I need to buy multiple ETFs or can I just pick one?

You can buy just one broad market ETF like VTI and own the entire U.S. stock market. For more diversification, add an international ETF and a bond ETF. There is no rule—it depends on your goals and risk tolerance. A single ETF is simpler; multiple ETFs give you more control over your allocation.

Are ETF dividends taxed differently than mutual fund dividends?

No, they are taxed the same way. may have access to dividends are taxed at long-term capital gains rates, and non-may have access to dividends are taxed as ordinary income. The difference is that mutual funds often reinvest dividends automatically, while Robinhood pays them as cash you have to reinvest manually.

Can I set up automatic investments in ETFs on Robinhood?

Robinhood does not offer automatic recurring investments like some other brokers do. You have to manually buy ETFs each time you want to add money. This is not a major obstacle—it takes 30 seconds—but it means you have to remember to do it rather than setting it and forgetting it.