Robinhood news – Robinhood UK starts offering options trading

The US fintech company, known for offering commission-free trading, is also planning to bring its desktop platform for investors from the US to the UK.

Options trading is a type of investment where you buy and sell contracts that give you the right to buy or sell stocks or ETFs at a specific price within a certain time. Investors use options to protect against potential drops in stock prices or to bet on future price movements.

According to Jordan Sinclair, Robinhood, UK president, options trading is a ”bit more accessible” in the US, compared to the UK, and said that its UK customers have been “asking us for the product since day one”. The news was first reported by Yahoo Finance. "Access to options trading has historically been hindered for many UK investors due to high fees, complicated platforms, and limited educational resources. Our goal is to make options trading in the UK accessible, straightforward, and affordable for all."

Robinhood launched in the UK in March last year, offering commission-free trading and no foreign exchange fees on over 6,000 US stocks. They also offer 5% interest on uninvested cash. Since then, they’ve added more investment products like share lending and margin trading.

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Sinclair said: "And that is a great base for an investment product. We are going to keep adding to that." The likes of share lending, margin trading and options trading can be deemed as riskier investment products, but Sinclair said Robinhood had all the right controls in place so that only eligible investors could use the products.

Sinclair said Robinhood will keep adding both US products and custom UK options to its app, like stock and share ISAs. One US product coming to the UK is Robinhood Legend, a desktop platform designed for active traders. It launched in the US last October and offers advanced trading tools and real-time data.

Vlad Tenev, Robinhood CEO and co-founder, told CNBC: “We have done very well on mobile historically among younger people. But about half the market is on desktop web, where you have more real estate on the screen, you can do more sophisticated things like have charts and data and the trading in the same interface. We weren’t really a player in that space.”

Sinclair said UK customers liked Robinhood Legend, and their feedback will help guide future updates. However, he mentioned that Robinhood probably won’t offer event derivatives trading in the UK.

Robinhood Offering

In the US, Robinhood allowed users to bet on things like the election outcome and considered offering bets on the Super Bowl, but pulled back after regulators raised concerns. Sinclair said event contracts are "not something we plan to offer our UK customers right now."