Robinhood's core trading has no commission, but other fees apply
Robinhood does not charge a commission when you buy or sell stocks, ETFs, options, or cryptocurrencies. That is the main draw of the platform. However, Robinhood does charge fees in specific situations — wire transfers, margin interest, and certain account services — and the app makes money through other means that affect your returns without appearing as a line item on your statement.
Understanding where Robinhood's revenue comes from and what you will actually pay helps you decide whether the platform fits your situation. A free trade is only free if you are not paying for it somewhere else.
Key Takeaways
- Stock and ETF trades are commission-free, but wire transfers out of your account cost $5 each way.
- Robinhood Gold (the paid subscription tier) costs $5 per month and offers margin trading and extended hours; you pay interest on borrowed money on top of the subscription.
- Robinhood makes money through payment for order flow, meaning it sells information about your trades to market makers, which can slightly widen the price you receive.
- Margin accounts charge interest rates that vary by account size and market conditions, typically ranging from 2.5% to 12.5% annually on borrowed funds.
- Inactive accounts and certain account closures may trigger fees depending on your account type and how long you have held it.
Wire transfer fees and how to avoid them
Withdrawing money by wire transfer costs $5 per outgoing wire. Incoming wires are free. If you need to move money out of Robinhood regularly, this adds up — $5 per transaction means $60 per year if you wire out monthly.
The workaround is to use ACH transfers instead, which are free and typically take one to three business days. ACH has a limit of $50,000 per transfer on most brokerage accounts, but if you are moving smaller amounts, ACH eliminates the fee entirely. You can set up ACH transfers through the app under Account Settings.
Robinhood Gold subscription and margin interest
Robinhood Gold is a $5 monthly subscription that unlocks margin trading (borrowing money to buy securities) and access to extended trading hours before the market opens and after it closes. The subscription itself is a flat fee, but margin comes with interest charges on top.
When you borrow money through margin, Robinhood charges interest based on how much you borrow and for how long. Interest rates are not fixed and vary by account size and market conditions. Rates typically range from 2.5% to 12.5% annually on the borrowed amount. A $10,000 margin loan at 5% costs $500 per year. You pay interest whether your trades gain or lose money, so margin is a cost of borrowing, not a cost of trading.
Most new investors should avoid margin entirely. Borrowing to invest amplifies both gains and losses, and the interest cost eats into returns. Robinhood makes margin easy to access, which is a feature for experienced traders and a trap for beginners.
Payment for order flow and how it affects your prices
Robinhood does not charge you a commission, but it receives payment from market makers — the firms that actually execute your trades — for routing your orders to them. This is called payment for order flow, and it is how Robinhood funds the platform.
The catch is that this arrangement can cost you money indirectly. Market makers pay for your order flow because they profit from the difference between the bid price (what buyers offer) and the ask price (what sellers want). When Robinhood routes your order to a market maker that paid for it, you may receive a slightly worse price than you would on a traditional exchange. The difference is usually cents per share, but on large trades or frequent trading, it compounds.
You cannot see this cost on your statement because it is baked into the price you receive. Robinhood discloses this practice in its regulatory filings, but the app does not show you the alternative price you might have gotten elsewhere.
Cryptocurrency trading fees
Robinhood charges a spread on cryptocurrency trades — a markup on the price you buy at and a markdown on the price you sell at. The spread is typically 1% to 2% on each side of the trade, meaning if you buy and immediately sell the same cryptocurrency, you lose 2% to 4% to the spread alone.
This is different from a commission but functions the same way: it is a cost of trading. Cryptocurrency exchanges like Coinbase or Kraken charge explicit trading fees (usually 0.5% to 2%), which are more transparent but not necessarily cheaper. Robinhood's spread is built into the price, so you see only the total cost, not the fee component.
Account maintenance and inactivity fees
Robinhood does not charge a monthly account maintenance fee for standard brokerage accounts. However, if you close your account, Robinhood may charge a $75 account closure fee in some states or situations, though this is not universal and depends on your account type and local regulations.
Inactive accounts — those with no trades or activity for an extended period — do not trigger fees at Robinhood, unlike some traditional brokers. Your money sits in the account without penalty, though you earn no interest on cash balances unless you are enrolled in Robinhood Cash Management (a separate service with its own terms).
Robinhood Cash Management and interest rates
Robinhood offers Cash Management, which sweeps uninvested cash into partner banks and money market funds that pay interest. This is not a fee service — Robinhood does not charge you to use it — but the interest rates offered vary and are set by the partner institutions, not Robinhood itself.
Interest rates on cash balances change frequently and depend on the current federal funds rate. Robinhood advertises the rates available, but they are not may provide and can drop if market conditions change. If you hold large cash balances, comparing Robinhood's rates to a high-yield savings account or money market fund elsewhere is worth doing.
Options trading and regulatory fees
Robinhood does not charge a commission on options trades, but the exchange that clears your options contract charges a regulatory fee of $0.65 per contract. This is a small cost per trade but applies to every options contract you close, whether you profit or lose.
If you sell 10 options contracts, you pay $6.50 in regulatory fees. This fee is set by the exchange, not Robinhood, and all brokers pass it through. It is not avoidable, but it is transparent and disclosed at the time you place the trade.
Frequently Asked Questions
Does Robinhood charge fees for buying and selling stocks?
No. Stock trades are commission-free. You pay no fee to buy or sell individual stocks or ETFs. However, you may receive a slightly worse price due to payment for order flow, which is not visible as a fee but affects your execution price.
What happens if I keep money in my Robinhood account and do not trade?
Nothing. Robinhood does not charge inactivity fees or monthly account maintenance fees. Your cash sits in the account without penalty, though it earns no interest unless you enroll in Cash Management, which is free but pays rates set by partner banks.
Is Robinhood Gold worth the $5 per month?
That depends on whether you use margin and extended-hours trading. If you do neither, Gold has no value. If you borrow on margin, you pay interest on top of the subscription, so the $5 is a small part of the total cost. Extended-hours trading is useful only if you actively trade before 9:30 a.m. or after 4 p.m. ET.
Why is my cryptocurrency price different from what I see elsewhere?
Robinhood charges a spread on crypto trades, typically 1% to 2% on each side. This markup is built into the price you see, so you do not see a separate fee line. Other exchanges charge explicit trading fees that may be lower or higher depending on the platform.
Can I avoid payment for order flow fees?
No. Payment for order flow is how Robinhood funds the platform, and it affects the price you receive on every trade. You cannot opt out, but the impact is usually small on individual stock trades and more noticeable on frequent or large trades.