Gone are the days when investors had to depend on stock exchange agents to invest in financial markets. With the advent of stock trading apps, investing in stocks has become a matter of a few clicks and zooms. The app keeps the users updated on the stock movements and allows them to buy/sell stocks in real time without the involvement of any intermediaries.
This ease that the stock trading apps provide has not gone ignored by the investors and firms who wish to make the whole trading experience seamless for everyone.
There are a number of applications that have made investing and trading accessible for users. One of those applications is Robinhood – the app that redefined the stock trading app ecosystem with 15.9 million active users and a valuation of $7.7 billion in 2022.
Now, keeping Robinhood app in the base, this article will help you understand the stock trading app development cost and the various factors that affect it. In addition to this, we will also look into how a stock trading app works and makes money.
To give you a brief idea, the stock trading app development cost varies from $40,000 to $200,000. The price of the app can further increase or decrease based on the app complexity, its feature list, UI/UX design, location of the app development agency, etc.
Now, before diving into the technicalities concerning the trading app development cost, let us first understand all the hype regarding the stock trading app Robinhood and why investing in a similar app can be beneficial for your business.
Understanding the hype about Robinhood stock trading app
Robinhood is an online brokerage app that lets users invest in stocks for free. Launched in 2014, the app enables investors to buy and sell ETFs and stocks without the need to pay a commission.
Being a zero commision stock trading app, Robinhood was capable of giving wings to the micro investors by making them understand how to manage and handle their money. The app was launched in Silicon valley and its seamless design and easy to use interface attracted several micro investors in no time.
Here are a few reasons why Robinhood disrupted the stock market :
- The app lets investors create an investment portfolio
- It offers people up-to-date market data
- It sends investors push notification with respect to their upcoming dividends
- It allows investors to trade without waiting for the funds to “settle”.
- Zero commission fee for selling or buying stocks
- No annual or monthly charges
- No commission on cryptocurrency trading
- Referral program enabling users to earn free stocks
Let us now understand various facts about the timeline of stock trading app Robinhood and how investing in the same can help your business gain immediate attention in the investment ecosystem.
Now, as per recent reports, the stock trading app market is expected to witness a market share of $89.8 billion by 2032 while observing a CAGR of 20.8% from 2022 to 2032. With the growing market dynamics, it is now the right time to dive into the business and experience the immense benefits of stock trading app development.
Now, without further ado, let us move ahead and discuss the Robinhood-like app development cost in detail and the multiple factors that affect the overall budget for development.
Comprehending the stock trading app development cost
As revealed earlier, the cost of stock trading apps like Robinhood can vary between $40,000 and $200,000. There are multiple factors that affect the trading app development cost such as the hourly rate of developers, the UI/UX design of the app, its coding process, platform for which the app is being developed, etc.
Now, understanding the exact Robinhood-like app development cost is a daunting process and requires a dedicated fintech application development company to help you understand the nitty gritties and offer clear estimates based on your custom business requirements.
Now, the overall complexity of the app can help you get clear estimates on the stock trading app development cost. For instance, a highly complex app with an extensive feature list will usually cost you more compared to a simple app with a minimal feature list.
Let us try and offer you a rough estimate of the cost and time frame for developing stock trading apps like Robinhood based on the overall complexity.
|Stock Trading App Type||Estimated Cost||Time Frame|
|Simple App||$40,000 to $75,000||3 to 6 months|
|Moderately Complex App||$75,000 to $135,000||6 to 9 months|
|Highly Complex App||$135,000 to $200,000||9+ months|
Now that you understand how much does it cost to build a trading platform based on its complexity, let us try and offer you an infallible formula for determining the exact development cost based on your requirements.
Here the total development hours are the time frame required to complete the app’s design, its coding, quality assurance, maintenance, etc.
Now, let us discuss the various factors that affect your overall budget for development in detail below. Remember, it is only after understanding those factors, you will be able to get a complete understanding of what is shaping the cost to develop an app like Robinhood.
Factors that affect the cost of stock trading app
Here is a breakdown of the factors that affect the cost of a stock trading app like Robinhood, giving you a clearer idea of what goes into deciding the cost of an application.
Robinhood application rides on a simplistic and clear design. But they do make use of a lot of micro-interaction elements that are not commonly seen in other similar information-rich applications. These elements add to the cost of developing a stock trading app. You also need to add features such as push notifications, icons, and customization if you wish to make an impression on your users. A good design will make your users want to use your app more and not drift away from it in the long run.
The Robinhood clone app cost with respect to designing will not be very high for it requires more innovation compared to complex design elements.
The frontend and backend of the application will play the biggest role in the cost to develop an app like Robinhood. These costs, in turn, will depend on the type of technologies and frameworks you use.
When we talk about the backend part of a stock trading app, there are two approaches that you can choose from – Monolithic and Microservice. While Monolith is a lot more cost-effective, it is a Microservice backend that holds the ability to make your application long term and highly scalable.
Testing of an application like Robinhood, which handles people’s money in real-time usually comes at a cost. There are multiple things and strategies that you will have to ensure when testing your Robinhood–like application – the working of the app when the market is open, ensuring all the APIs are working as they are supposed to, and checking if the synchronization is seamless.
Ideally, a stock trading application should be operational on two platforms – Android and iOS. So, if you are releasing your app on multiple platforms, the cost of stock trading app development will also increase. It’s best to start with a single platform and then move on to other platforms. This will help you save costs in the initial stages. And once your app is successful, you can launch it on other platforms.
The cost of your stock trading app development will also depend on the team size chosen for developing your app. If you outsource your project to a reliable fintech app development company which has expertise in multiple domains, they will offer you expert resources and deliver excellent services. As compared to hiring freelancers or onboarding an in-house team, outsourcing an organization won’t let you compromise on the quality of service and it will definitely speed up the development process.
The minimum team requirements to create stock apps like Robinhood include:
- 1-2 project managers
- 1-2 business analysts
- 2-3 frontend developers
- 2-3 backend developers
- 1-2 designers
- 1-2 quality assurance analysts
Location of the Company
The location of the app development organization will also directly impact the cost of a stock trading app like Robinhood. For instance, the hourly rate of development for the organizations based in the regions like Asia are lower compared to the hourly rate of development in the UK or US. Here is the estimated rate of development as per multiple regions of the world.
|Region||Hourly Rate of Development|
The technology stack you choose for developing stock apps like Robinhood affects the overall budget for development. An investment app that is based on a robust tech stack and features modern technologies will help you gain traction in this otherwise competitive market.
The trading app features also affect your mobile app development costs. It is important to understand that an app with an extensive feature list can offer you a much-needed competitive edge.
Let us now move ahead and look at the various features of stock trading apps like Robinhood.
Must-have Robinhood app features
When developing a stock trading app, it’s important to decide which features to include in your app. They will help you determine how a stock trading app works. You must make sure to include such features that make the whole experience user-friendly for the users. Below are a few features that you must include in your mobile app.
This is the space that carries everything an investor should know – order status, watchlist, balance, charts, holdings, and so on. Since the screen will contain a huge variety of information, it is important that you show them all in a way that it doesn’t become a case of information overload.
Using this functionality, the investors will be able to create and manage their own portfolio without relying on any third party agent. It would be beneficial at this stage to add the filter and sort functionality in the portfolio to make it easy for investors to find what they are looking for.
Latest market data
The application should contain all the latest market insight to help investors be in the know-how of their stock performance along with an insight into which all stocks are trending in the market. By using AI powered stock trading, you can provide even more value to your users in terms of trend forecasting and predictive analysis.
Stock trading functionality
Stock trading is the core of Robinhood or similar stock trading applications. It is the functionality that your users will be interacting with the most inside the application. You should make the entire process of holding, buying, and selling the fund a hassle-free event for the investors.
This part of the application will primarily focus on transferring funds from the users’ accounts into the application to then use in trading of the stock. This functionality is one where the most attention should be given to the development of a secure platform that would make it safe for users to transfer funds in real-time.
In order to make it possible for investors to track the stocks they are interested in, you should give them the option of adding the stocks to the watchlist – this way they will not have to search for them individually every time they open the application.
Notification and alerts
Stock trading requires quick reactions and having relevant data right at your fingertips. Notifications and alerts allow users to receive important information about events, earnings, and growth and falls. Usually, the users can set up their custom alerts, e.g., when the value of the stock reaches a certain threshold.
Stock trading apps like Robinhood are not only used by experienced investors but also newbies. This is why some apps offer a learning feature to make it easier for new users to understand all about the stock trading market. You can also utilize gamification to increase user engagement. Some apps also use a trading simulator in which a user doesn’t spend real funds but fictional ones. It is an excellent way to help users realize the risk coming from trading.
The Robinhood app features a well-established security system that encrypts all the sensitive user data. So if you are building a stock trading app, you need to focus on the encryption of user’s personal data like bank data, balance, transaction details, etc. This will help in building a good relationship with customers.
Now that you have a clear understanding of the feature-set that comes together to build a robust stock trading app, let us now help you understand how to create an investment app.
How to create an investment app like Robinhood?
Building a stock trading app like Robinhood requires you to carry out various steps that are discussed in detail below. Following a dedicated approach for app development ensures great collaboration between the hired team and the entrepreneurs. This further allows the developers to adhere to the pre technicalities and ensure that the app is capable of standing out from the competitors.
1. Market analysis and research
The first step of creating a feature-rich stock trading application is carrying out a thorough market research and analyzing the trends. Further validating the product idea and turning it into a reliable business model requires the development team to carry out an effective roadmap for development.
2. Formulate a development approach
The next step for developing stock trading mobile apps is to formulate a reliable development approach. Here you have to decide on the platform to be used for the app, the features to be implemented, the third-party APIs to be used, etc.
3. Create a seamless UI/UX design
After finalizing the feature list and working on the roadmap, now it’s time to create an app prototype that is capable of getting funding. Ensuring that your app features a seamless design further promotes increased user engagement as well as retention.
4. Carry out the development process
Now, it’s time to start with the coding process. This stage involves diffrent front-end and back-end development methodologies to be carried out based on Android or iOS platforms.
5. Follow stringent testing techniques
After the coding process is completed, it is now time to carry out the required quality assurance. Make sure the testing team performs manual, visual as well as automated testing to ensure that the app works as expected and is able to retain and engage users.
6. Deploy and maintain the app
Now that your app is tested thoroughly with the help of multiple testing tools and is bug-free, it is time to deploy the stock trading app on the App or Play store. It is important to understand that the development process doesn’t just end here, you need to maintain the app constantly to keep it bug free and update it as per the changing market requirements.
Now that we have seen how to create an app like Robinhood, let us move ahead and help you understand how the stock trading app Robinhood makes money and various other monetization strategies that you can implement for your app.
How does a Robinhood-like app make money?
Like we mentioned at the beginning of the article, the Robinhood app offers free of cost trading to the users. It raises an immediate question: If Robinhood does not charge any trading fees, how do they make money? What is the Robinhood app business model?
The main source of earning that the Robinhood app works around is its premium offering known as Robinhood Gold.
Robinhood Gold is an upgrade for app users who are a lot more experienced and are willing to take greater investment risks. The upgrade calls for a monthly payment in exchange for giving users extended trading hours and more buying power. This extra buying power translates into the fact that the users are able to borrow money when they wish to purchase stocks.
The app charges $5 every month to the users who wish to continue with their subscription for Robinhood Gold and enjoy premium services. Securities and cash are also collected from the users of the Robinhood app just like how banks charge from clients’ cash deposits.
Now, if you wish to develop a trading app like Robinhood, here are a few other monetization strategies that can help you generate a constant revenue stream.
You can make use of the advertisement-based business model for your trading app. For instance, you can offer your app space to display related advertisements and charge a sum of money for the time the ad is to be displayed.
2. Paid Membership
A paid membership is one of the easiest ways to increase your ROI.The users can make use of additional and advanced features and make unlimited transactions only with a paid membership.
3. Transaction Fee
You can charge a transaction fee from the users for every transaction they make. It is one of the most-used monetization models used by trading apps across the world.
We hope this article was helpful in understanding the cost of building a stock trading app like Robinhood. However, developing a free stock trading app like Robinhood needs skilled developers to overcome tech challenges and ensure a smooth and stable performance of your app.
If you are looking for stock trading app development like Robinhood, it’s advisable to consult a fintech app development company like Appinventiv. We have a highly skilled team of app developers who have mastered the technologies that are needed to develop top-notch stock trading apps. Our custom financial app development services can help your business achieve digital innovation, the same way we did for Mudra.
We recently created Mudra, a budget management application integrated with AI capabilities. The app allows the users to make better financial decisions by keeping a tab on their daily expenses and informing them immediately when their budget gets out of hand. The app was launched in 12+ countries globally to make it a fintech industry revolution.
Get in touch with our first-class engineers that can help you develop next-gen financial solutions.
Q. How to estimate the cost to develop a stock trading app?
A. The answer to how much does it cost to build a trading platform is an estimate that is arrived at after gathering a complete understanding of the app development project. To give you a rough idea, the cost of developing a stock trading app can vary between $40,000 to $200,000.
Some of the factors that will affect the costing are:
- The designing requirements
- Platform choice
- Technology set
- Team size
- Scope of testing
Q. What are some of the features you can include in your stock trading app?
A. Some of the common features that you can include in your app is dashboard, stock trading functionality and portfolio. In addition to these, the app should include features like a watchlist that can help users to add the stocks they are interested in. The app should also offer timely notifications and alerts to the users to keep them hooked to the app while also increasing the overall engagement.
Q. Why develop a stock trading app for investors?
A. There are a number of reasons why entrepreneurs should focus on stock trading apps but the primary most are the massive user base and investors’ interest in the app category.
Q. How to make a stock trading app like Robinhood?
A. Creating a stock trading app like Robinhood requires you to carry out the various steps:
- Analyze the stock trading market and your target audience
- Choose a relevant business model for your stock trading app
- Hire a dedicated app development organization
- Finalize the features and technologies to be used
- Complete the UI/UX design process
- Make several measures for quality assurance
- Deploy the app in the market
- Maintain as per the emerging trends