By Andrew Welsch

Robinhood Markets' robo-advisor, Robinhood Strategies, surpassed $1 billion in assets under management just over six months after it launched. Robinhood Strategies has more than 180,000 funded accounts, Chief Investment Officer Stephanie Guild said last week.

Robinhood's success in attracting assets comes amid struggles for the robo-advisor sector, which has grown in overall assets but seen some players exit the market after struggling to attract customers. For example, in 2024, JPMorgan Chase discontinued its purely digital robo-advisor, citing profitability challenges. The bank still has thousands of human financial advisors and a hybrid offering that pairs digital and human elements.

Robinhood has achieved a significant milestone, says David Goldstone, manager of investment research at Condor Capital Wealth Management and author of the firm's long-running Robo Report. "It's real traction even if it's small accounts and existing customers because it's showing that there is interest in the product," Goldstone says.

A spokeswoman for Robinhood declined to specify how many of Robinhood Strategies' users are new customers for the company, saying the company was in its quiet period before it reports earnings next month.

She added that the company has strived to build a digital advice offering that is different from the competition. "When we set out to build Robinhood Strategies, we began with identifying gaps in the market that we wanted to solve for our client -- namely, between the human element of advice and the services of robo advisors," she said. "The result, we believe, is truly the best of both worlds."

Robinhood Strategies' portfolios are managed by investment strategists who oversee asset allocation moves and pick individual stocks. Other robo-advisors primarily build portfolios with passive and actively-managed exchange-traded funds.

Robo-advisors offer investors professionally-managed portfolios at a fraction of the cost of traditional wealth management companies, and often with low or no investment minimums. Robos typically charge about 0.25% on assets under management, about a quarter the cost of a traditional financial advisor.

Robinhood Strategies has a 0.25% annual management fee and the minimum investment requirement is $50. Customers who sign up for Robinhood's gold subscription service don't pay the management fee for every dollar over $100,000. A Robinhood Gold subscription costs $5 per month.

Several of the industry's largest robo-advisors by assets are operated by companies that also have large self-directed brokerages, such as Charles Schwab and Vanguard. "Many people who manage their own investments don't necessarily want to do that across the board," Goldstone says. "For the right price, they are willing to hand over some of their assets to a professionally managed account."

For Robinhood, the company's robo-advisor is one of several ways that it is diversifying its revenue streams and branching out beyond being just a free stock-trading app. Last year, the Menlo Park, Calif.-based company acquired TradePMR, a custodian to registered investment advisory firms. Robinhood has said it plans to build a referral network to connect self-directed investors with financial advisors.

Write to Andrew Welsch at andrew.welsch@barrons.com

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October 27, 2025 14:57 ET (18:57 GMT)

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