Robinhood Brokerage Accounts

Robinhood Financial offers two types of brokerage accounts, each designed to suit your investing goals and needs.

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Margin Accounts

Margin accounts consist of two subtypes: limited margin and margin. At Robinhood we refer to our limited margin accounts as Robinhood Instant accounts.

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Robinhood Instant (limited margin)

When you sign up for a new brokerage account, you’ll start with Robinhood Instant by default. With Instant, you’ll have access to instant deposits (up to $1,000). You’ll also have the ability to trade on unsettled funds, which means you won’t have to wait for your funds to process when you sell securities. And if you’re approved for options trading, you will be able to enter options trades that require a margin account. But you will not have the option to purchase securities on credit (what’s traditionally called “margin investing”) with an Instant account.

All brokerage customers start out with an Instant account, which is a margin account, so that they can access funds before they’ve settled and enter options trades if they’re approved. Even if you’ve never borrowed money in your account, this account type is still classified as a “margin” account from a regulatory standpoint. As a result, it will appear as such on your annual tax documents and monthly account statements.

There may be certain limited scenarios in which you can use margin or borrowing with an Instant account.

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Robinhood Margin

A Robinhood Margin account can give you access to more buying power through margin investing. Similar to an Instant account, a Margin account gives customers access to funds before they’ve settled and the ability to enter options trades that require a margin account if approved for Level 3 options trading. A Margin account also give you access to borrowed funds for trading, spending and withdrawing. Margin investing is subject to eligibility requirements.

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Cash Accounts

Cash accounts are not subject to pattern day trading (PDT) regulations. This means you can trade stocks, ETPs, and options without worrying about your number of day trades.

Note: Switching to a cash account will not remove active PDT-related position closing only restrictions.

With a cash account, deposits must clear before they are available to invest. This may take up to 5 business days, depending on your method of deposit and deposit history at Robinhood.

Cash accounts can’t trade with unsettled funds. You’ll need to wait 2 business days to trade with funds from equity sales, and 1 business day to trade with funds from options sales.

Cash accounts also can’t access Level 3 options trading, or options rolling. If approved for options, you can only access Level 2 options trading.

You can switch to a cash account from both margin account subtypes: Robinhood Instant and Robinhood Margin. However, you will not be able to switch back to Instant or Margin until 5 trading days have passed.

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All investments involve risk and loss of principal is possible.

Brokerage accounts are offered through Robinhood Financial LLC (member SIPC), which is a registered broker-dealer. Robinhood Securities, LLC (member SIPC) is a registered broker-dealer and provides brokerage clearing services. Both are subsidiaries of Robinhood Markets, Inc. (‘Robinhood’).

Margin investing involves the risk of greater investment losses. Before using margin, customers must determine whether this type of strategy is right for them given their investment objectives and risk tolerance. For more information please see our Margin Disclosure Statement.

Options trading entails significant risk and is not appropriate for all investors. Customers must read and understand the Characteristics and Risks of Standardized Options before engaging in any options trading strategies. Customers should consider their investment objectives and risks carefully before investing in options. Supporting documentation for any claims, if applicable, will be furnished upon request.

Reference No. 20220725-2307623-7218051

Reference No. 20220725-2307623-7218051
Still have questions? Contact Robinhood Support