The time when investors had to call stock exchange agents and remain on hold listening to automated music is long gone and for the good.
Today, investing in stocks has become a matter of few clicks and zooms. The time today belongs to stock trading applications which make it hassle-free to be updated on the stock movements and buy/sell stocks in real time without the involvement of any intermediary.
This ease that the stock trading apps provide have not gone ignored by the investors and the firms who wish to make the whole trading experience seamless and natural for them.
Together, the firms and investors have formed a flourishing market for the stock trading app industry.
There are a number of applications that have contributed to the industry’s success, bringing it on the present and projected growth tangent like – Square Cash app, Stash, Trading 212, and Extrade, etc.
One of those applications is Robinhood – the app which defines the benefits of stock trading apps.
And in this article, we are going to look into the details of the Robinhood application and things that you will have to know to answer how much does it cost to make a stock trading app like Robinhood.
Table of Content:
- About Robinhood Stock Broking App
- Must-Have Features of Robinhood App
- How Robinhood’s Design Brings Back Trading to Youth
- Stock Trading App Tech Stack
- How Much Does Robinhood Like App Development Costs?
- Challenges Associated With Stock Trading Application Development
- How Does Robinhood Like App Make Money?
- How to be Successful in the Crowded Stock Trading App Industry?
What is Robinhood App?
The Robinhood application lets users invest in stocks for free. The online brokerage app launched in 2014 on Apple store to enable investors to buy and sell ETFs and stocks without the need of paying a commission.
- The app lets investors create an investment portfolio
- It offers people up-to-date market data
- It send investors push notification with respect to their upcoming dividends
- It allows investors to trade without waiting for the funds to “settle”.
Robinhood App Market Insights
- The number of Robinhood app users stand at a number of 6 millions.
- The reported market value of Robinhood is over $7.6 Billion.
- The total amount of funding raised by Robinhood till date is $860 million.
- The app has executed over $75 billion transactions.
- 78% of Robinhood’s users, whom are under age 35, want to both build their savings and develop relationships with the brand, just as they have done with Instagram and Twitter.
- The average age of Robinhood users is 28-41, and the majority of them use the application for making their first stock purchase.
Robinhood App In the News
A. Robinhood raises $323 million in Series E for commission-free mobile investing: Ever since May 2018, when the company raised Series D funding, Robinhood introduced a series of changes in its operations including the launch of its own clearing system, Robinhood Snacks, and Robinhood Gold. These changes helped the stock trading application raise over $323 million in Series E funding led by Sequoia, NEA, Ribbit Capital, and Thrive Capital.
B. Robinhood Financial LLC announced its plan to enable trading of cryptocurrency on its platform starting February 2019. The feature that first rolled out in California, Massachusetts, Missouri, New Hampshire and Montana is now operational in New York as well.
C. Robinhood acquired MarketSnacks and rebranded the product as Robinhood Snacks: The platform which offers a financial news podcast and newsletter.
“In 2012, we co-founded MarketSnacks outside our bank jobs to make financial news more accessible and enjoyable for our generation,” said Jack Kramer and Nick Martell, co-founders of MarketSnacks. “That aligns perfectly with Robinhood’s mission, and together we can inform millions of people every day. We’re honored to join forces with Robinhood and thankful for our incredible Snackers who helped get us here.”
The Technicalities of Robinhood Clone App Development
This is the space which 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 how their stocks are performing along with an insight into which all stocks are trending in the market.
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 which 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 in watchlist – this way they will not have to search for them individually every time they open the application.
If you are thinking of creating a trading platform for more than one device, which going by the demographics of the app users, you should, you will have to work on the account synchronization facility.
Apart from these features, what really sets Robinhood apart from its competitors is the app’s UX – which is in line with all the latest app UI/UX design trends.
Let us dissect Robinhood’s UX before we move on to the next technical element.
What truly separates working model of the Robinhood app from the other stock trading apps is its on-boarding. From signing up to linking the bank account to actually buying the stocks, it takes a user only 5 minutes to perform the entire action.
On-boarding can be especially tricky for an application that deals with a lot of private information and money. But Robinhood makes the entire event easy and not sloppy.
Keeping the simplicity quotient intact, Robinhood app only works around two work screens: the dashboard and detail stock page.
Effective Colour Usage
The rigid and clear colour scheme that Robinhood follows is hard to ignore and not appreciate. Primarily, they have worked around only 4 colours to indicate the performance and main events of the application – White, Black, Green, and Red.
When the market is open, the screen background becomes white while when the market is closed, the screen becomes black. The reasons why the application works even when the market is closed are – A. It still enables users to perform some non-market dependent functions and B. It highlights that they can trade in the cryptocurrency market, which is open 24 hours.
Even though the app is minimal and the information that has to be viewed is also limited, there are multiple micro interactions that help in exposing the detailed index information. Example, the price related to a certain time period can be seen by holding and dragging the chart. As the users move their finger across the screen, its x position aligns to the time in the chart.
And for performing crucial functions like buying or selling stocks, users have to swipe instead of tapping on the screen.
Robinhood like stock trading app tech stack primarily stands on four pillars – Application & Data, DevOps, Utilities, and Business Tools. For their data and applications needs Robinhood application relies on tools like React, Python, Django, etc.
On the Utilities front, they rely on Elasticsearch and Google Analytics. The DevOps needs to develop a stock trading app like Robinhood are managed by Webpack, Kibana, GitHUB, ELK, etc. Lastly, they work with four business tools namely – Confluence, Asana, G Suite, and Slack.
There are a number of factors that come together into consideration to estimate cost of Robinhood clone app development. 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.
Here is a stock trading app development cost breakdown, which will give you an idea of what goes into deciding the cost of an application.
Design Requirements of the App
Robinhood application rides on a simplistic and clear design. But they do make use of a lot of micro-interaction elements which are not commonly seen in other similar information rich applications.
The Robinhood clone app cost with respect to designing will not be very high for it requires more of innovation compared to complex design elements.
Backend and Frontend Development
The frontend and backend of 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 how to develop Robinhood like 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 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 will come with some complexity that will then, in turn, come with an attached cost. There are multiple things that you will have to ensure when testing your Robinhood like application – the working of 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 – Mobile and Desktop. The cost of robinhood like stock trading app development will increase on this ground as the efforts needed to get on multiple platforms would also increase. Additionally, the Robinhood like app development cost would increase if you contact an iOS app development company vis-a-vis an Android app development company.
The team component that is employed in developing the Robinhood like application will also carry an impact on the cost of robinhood like stock trading app development.
Normally, the application would require a team composition that looks like this:
- Project Manager
- Android app Developers
- iOS app Developers
- HTML Experts
- QA Experts
- Deployment Incharge
The more people you appoint against each task, the greater would be your Robinhood like application development cost.
The factors that have to be considered does not end here. You will have to look into other elements as well like the details of the features and functionalities, the technology set used, etc.
Another factor that plays a prominent role in deciding of the time and thus the Robinhood like app development cost is the development challenges that your partnered Fintech app development company might come across.
Developing an application like the Robinhood or Trading 212 stock trading apps comes with high numbers of technical development challenges.
While building a stock trading application, expert Fintech app developers will have to run multiple tests within the restricted market hours – making it difficult to make use of the real-time data.
Another difficulty that developers can face is providing real-time responses in terms of showing the stock values and buying and selling the stocks when the market is open.
While the majority of these issues and other similar difficulties all for complex technical solutions, sometimes third-party APIs solve the issues. Here are the two APIs that our team of stock trading app developers recommend when developing your own Robinhood like application:
The API comes in handy when you have to access the real-time price data feed and fetch number of useful information such as holdings, economic, security, companies, and bank data feed, etc.
The API can be used for:
- Managing the users’ account data
- Retrieving their option chains
- Searching for stock exchange
- Getting quotes and managing orders.1
Now that we have looked into the technical aspects of Robinhood like application development, it is time to get on the business side of the application. In the next two sections, we are going to look into the answers of how to earn money and how to be successful in the crowded stock trading app market.
Like we mentioned at the beginning of the article, 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?
The main source of earning that Robinhood app works around is its premium offering known as Robinhood Gold.
Robinhood Gold is an upgrade for the 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 monthly fees which ranges from $10 to $200, is heavily dependent on the tier of the user, which in turn is determined by the amount of money there is in users’ account. They also collect securities and cash in the Robinhood just like how Banks charge from clients’ cash deposits.
Now that we have looked into the money part of Robinhood like application, let us move to the fame part.
There is very little that you can do on the designing and development front that Robinhood application haven’t employed already. So, while you should try to keep up with the standards that the app has set in the stock trading industry in those two fronts, you can work around features to make your application a lot more expansive.
Here are some of the things that you can add in your stock trading application, functionality wise, to bring it points ahead of the business model of Robinhood like stock trading app:
Adding Educational Elements
The learning material that you should offer to a user base that belongs to a new investor class should be present to explain them the basics of the stock trading industry – just so that they are on the road to become expert investors.
Adding Research Capabilities
You should give the users a space to explore the stock market further – observe how the market is moving, get insights into what events would increase or decrease the stock value or what they can expect from the stocks they have invested in or ones which are there in their watchlist.
The stock trading application should come with a forum where users are able to discuss the market with other investors in the application and learn something from each other in the process.
FAQs About Robinhood Like App Development Cost
Q. How to Estimate the Cost to Develop Stock Trading App?
The answer to how much does it cost to make stock trading app is an estimate that is arrived at after gathering a complete understanding of the app development project.
Some of the factors that you will have to look into are:
- The designing requirements
- Platform choice
- Technology set
- Team size
- Scope of testing
Q. Why Develop a Stock Trading App for Investors?
There are a number of reasons why entrepreneurs should focus on stock trading apps but the primary most is the massive user base and investors interest for the app category.
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