$CashApp Versus Robinhood
The on-going saga of Reddit users, and then pretty much all social media users, deciding to punish Wall Street brokers for their short sales of GameStop, AMC and Noki is likely to change the investing world.
Whether for the better or the worse, depends on how much big money firms are able to lobby Congress to punish small buyers for the beating them at their own game.
In short, a couple big investment houses bet that those three stocks would lose money. Reddit users got wind of it and promoted small investors to use trading apps and programs like Robinhood and $Cashapp to buy stock in those companies. More people buying stock makes the price go up, not down.
Big investment firm loses lots of money. People who can’t normally afford to invest in the stock market make a little bit of extra spending money. For some, a lot of extra money.
The big investment firm throws a whiny fit and Robinhood suspends the ability to buy those three stocks. There’s also accusations that they did worse too, but that’s for the Security and Exchange Commission to figure out. What is absolutely clear and is being reported everywhere is that a bunch of people left Robinhood to go to Cashapp, driving up the price of CashApp’s parent company’s stock (Square) on February 1.
So I thought I might capitalize on the frenzy to offer a bit of a review of both companies based on my personal experience.
Robinhood offers you a free stock when you sign up. It’s random from a list of options they have and generally worth a few dollars. My free stock was in Catalyst Pharmaceuticals and almost 13 months after Robinhood gave it to me for free, it’s worth $3.88 today.
$Cashapp doesn’t play that gimmicky game, but they do have a referral program. So basically, you enter a code like this one GHBMLTG when you sign up and you get $5. No investment, just $5 in cash.
The best way to get a referral code is to ask a friend who has the app to send it to you. They typically get $15 for referring you.
Sounds like a great deal for your friend, right?
It is. But it’s also a great deal for you. $Cashapp has a stock and bitcoin buying and trading function, but it’s more than that. Primarily, it’s like Venmo or a half dozen other programs which allow you to easily send money to friends, or get money from friends. Generally, it’s just a matter of knowing their user name.
And as a user, you can block requests for money too. I have no intention of using my $Cashapp account for sending money to anyone so I turned off that function.
Then, if you want to use it for investing, $Cashapp’s interface is simple and easy to use. You search for the stock you want to buy and enter the amount you want to purchase. The app links to your debit card or bank account to make the transactions.
Once you have invested, the app lets you see the stock’s daily, weekly, monthly or yearly performance on the market, and keeps track of what you have earned, or lost.
For me, the difference is simple. $Cashapp gave me more for joining than Robinhood did and they didn’t decide to side with invest firms over their clientele last week. But both will give you something for free, so that’s reason enough to sign up.