How to buy stock on Robinhood
To buy stock on Robinhood, you open an account, link a bank account or deposit money, search for the stock you want by its ticker symbol, enter the number of shares you want to buy, and confirm the order. The stock settles in your account within two business days, but you can sell it immediately if you change your mind. Robinhood charges no commission on stock trades, which is why many people use it, but you still pay the bid-ask spread — the difference between what buyers will pay and what sellers are asking.
The process takes about five minutes once your account is funded. You do not need to be an experienced investor or have a large amount of money to start. Robinhood lets you buy fractional shares, meaning you can invest $50 in a stock that costs $200 per share by owning a quarter of one share.
Key Takeaways
- You must create a Robinhood account, pass identity verification, and link a bank account or deposit cash before you can buy any stock.
- Search for stocks by their ticker symbol (like AAPL for Apple or MSFT for Microsoft), not by company name alone.
- Robinhood charges no commission per trade, but you pay the bid-ask spread, which is the cost built into the price difference between buyers and sellers.
- Stock purchases settle within two business days, meaning the shares are fully yours, but you can sell them before settlement if you need to.
- Fractional shares let you invest any dollar amount, even if a single share costs hundreds of dollars.
Creating and verifying your Robinhood account
Start by downloading the Robinhood app or visiting robinhood.com and tapping "Sign Up." You will enter your email, create a password, and provide your legal name, date of birth, and Social Security number. Robinhood runs a background check through a third-party verification service to confirm your identity — this is required by law for all brokerage accounts.
The verification process usually completes within a few minutes, though it can take up to 24 hours in some cases. Once you pass, Robinhood will ask you to confirm your mailing address and phone number. You do not need to have a certain credit score or income level to open an account. If verification fails, Robinhood will tell you why and may ask you to submit additional documents like a driver's license or passport photo.
Linking your bank account and funding your account
After verification, you need money in your Robinhood account to buy stock. You can link your checking or savings account and transfer money electronically, or you can wire money directly. Robinhood accepts transfers from most U.S. banks.
When you link a bank account for the first time, Robinhood sends two small test deposits (usually under $1 each) to that account. You will need to confirm the amounts of those deposits in the Robinhood app to prove you own the bank account. This takes one to two business days. After confirmation, you can transfer money instantly up to a daily limit — Robinhood sets this limit based on your account history and typically starts at $1,000 to $5,000 per day.
Money you transfer usually arrives in your Robinhood account within one to three business days, depending on your bank. Once the money is there, you can start buying stock immediately.
Finding and selecting the stock you want to buy
Open the Robinhood app and tap the search icon at the bottom. Type the stock's ticker symbol — a one- to four-letter code that represents the company. For example, AAPL is Apple, MSFT is Microsoft, TSLA is Tesla, and AMZN is Amazon. If you do not know the ticker, search by company name and Robinhood will show you the ticker and the current price.
Tap the stock name to open its detail page. You will see the current price, a price chart, news about the company, and information about the company's business. Robinhood also shows you the bid price (what buyers are offering to pay right now) and the ask price (what sellers are asking right now). The difference between these two is the bid-ask spread, and it is the cost you pay when you buy.
Take time to review this information before you buy. Robinhood does not recommend stocks or tell you whether to buy or sell — that decision is entirely yours. If you are unsure about a company, do not buy it just because the price looks low or because you saw it mentioned online.
Placing your stock order
Once you have decided to buy, tap the "Buy" button on the stock's detail page. Robinhood will ask you how many shares you want to buy. You can enter a whole number (like 10 shares) or a dollar amount (like $500), and Robinhood will calculate how many fractional shares that equals.
Next, you choose your order type. Market order means you buy at the current market price right now — this is the default and the simplest option. Limit order means you set a maximum price you are willing to pay, and Robinhood only buys if the stock drops to that price or lower. Limit orders can take days to fill or may never fill at all if the price never reaches your limit.
For most beginners, a market order is the right choice. Review your order one more time — the stock name, the number of shares, the estimated total cost, and the order type. Then tap "Submit Order" or "Confirm." Your order is now placed.
What happens after you buy
Your order executes almost instantly during market hours (9:30 a.m. to 4 p.m. Eastern time on weekdays). You will see the stock appear in your "Stocks" tab with the number of shares you own and the current value. Robinhood also sends you a confirmation email with the order details, including the exact price you paid per share and the total cost.
The stock settles within two business days, meaning it officially becomes yours and you own it completely. During this settlement period, you can still sell the stock if you change your mind — you do not have to wait. However, if you sell before settlement, you may trigger a good-faith violation if you do this repeatedly. Robinhood allows three good-faith violations in a 12-month period before restricting your account.
Your cost basis — the price you paid per share — is recorded in your account for tax purposes. When you eventually sell, you will owe capital gains tax on any profit. Robinhood tracks this automatically and provides tax documents at the end of the year.
Understanding costs and fees
Robinhood charges zero commission on stock trades, which means you do not pay a flat fee per transaction like you would at a traditional brokerage. However, you still pay the bid-ask spread, which is the difference between the price buyers are willing to pay and the price sellers are asking. This spread is typically small for popular stocks (a few cents per share) but can be larger for less-traded stocks.
Robinhood also offers Robinhood Gold, a paid subscription that costs $5 to $12 per month depending on your account size. Gold gives you access to margin (borrowing money to buy more stock than you have cash for), extended-hours trading before 9:30 a.m. and after 4 p.m., and other features. You do not need Gold to buy stock — it is optional.
There are no account maintenance fees, no inactivity fees, and no fees for transferring money in or out. The only costs you pay are the bid-ask spread on each trade and any taxes you owe on gains.
Frequently Asked Questions
Can I buy stock during after-hours trading on Robinhood?
Yes, but only if you have Robinhood Gold. Extended-hours trading runs from 4 a.m. to 9:30 a.m. and from 4 p.m. to 8 p.m. Eastern time. Bid-ask spreads are wider during these times, meaning you pay more to buy and receive less when you sell. Most beginners should stick to regular market hours.
What is the minimum amount of money I need to start buying stock?
Robinhood has no minimum account balance. You can open an account with $1 and buy fractional shares. However, your bank may have a minimum transfer amount, so check with them before you link your account.
Can I set up automatic purchases on Robinhood?
Robinhood does not offer automatic recurring purchases or dividend reinvestment. You must manually buy stock each time. Some other brokerages offer these features if you want them.
What happens if I buy a stock and the price drops immediately?
You own the stock at the price you paid, regardless of what the price does next. You can hold it and wait for the price to recover, sell it and take the loss, or buy more at the lower price. Robinhood shows you your gain or loss in real time in your account.
Do I owe taxes on stock I buy but have not sold yet?
No. You only owe capital gains tax when you sell the stock and realize a profit. Until then, any gain is unrealized and not taxable. If you hold the stock for more than one year before selling, you may may have access to for long-term capital gains tax rates, which are usually lower than short-term rates.