Your financial journey starts here | Robinhood Learn (2024)

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Investing basics—in plain English.

Updated Feb 14, 2024Robinhood LearnWhat is an Iron Condor?An iron condor is like the large bird it’s named after. It can glide along smoothly if the market skies stay calm, providing investors with a welcome return. Or it can swoop in unexpected ways if the market ends up more turbulent than expected.
Updated Feb 02, 2024Robinhood LearnWhy should I think about investing?Like planting a tomato patch, investing requires time and patience. Often, there are challenges along the way. But with care and consistency, you give yourself the chance to build a rich harvest. So, let’s see that green thumb.
Updated Feb 02, 2024Robinhood LearnWhat is a Dividend?A dividend is like a ripe coconut falling from a tree... When a coconut falls from a tree, it’s as if the tree is a company, distributing some of its fruit back to you. As an investor, you have a choice of keeping the coconut or planting it.
Updated Feb 02, 2024Robinhood LearnWhat is a Fractional Share?A fractional share is like a slice of a gem… If a share in a company is like a gem, a fractional share is like a slice of that jewel. Not everybody wants (or can afford) an entire gem, but these jewels can be broken into smaller pieces.
Updated Jan 29, 2024Robinhood LearnWhat is a Liability?A liability is money that a company owes and has promised to pay in the future, whether it be to a bank who lent them money or to employees who have worked for them. Companies use these IOUs in the course of their normal business operations.
Updated Dec 29, 2023Robinhood LearnWhat is a Roth IRA?A Roth IRA is like a Redwood tree. You pay for sapling and the supplies to grow it. You put in a bit of effort over time to make sure that the tree is maturing. And when you’re ready to retire, you won’t have to pay more money to enjoy its shade.
Updated Dec 29, 2023Robinhood LearnWhat is an Exchange-Traded Fund (ETF)? An ETF is like an investment smoothie… Similar to a smoothie, it’s one thing you can invest in that’s made up of a mix of ingredients, available in different asset flavors (i.e., industries, sectors, etc.).
Updated Dec 29, 2023Robinhood LearnWhat is the Stock Market?The world’s stock markets are complex, but are all based upon one simple concept… Connecting stock buyers with stock sellers to trade under an agreed upon set of rules. This is the key role of every stock market, from New York to Hong Kong.
Updated Dec 22, 2023Robinhood LearnWhat is a Broker?Online brokers are like professional matchmakers. They offer a fast and efficient way to place trades and connect with people on the other side of a transaction. Some OG firms charge a commission for the service.
Updated Dec 22, 2023Robinhood LearnHow much should I save for retirement?Saving for retirement is like preparing for a long vacation. While you can’t pinpoint the exact cost of the entire trip, you’ll need to save enough so you hopefully don’t run out of money along the way.
Updated Dec 14, 2023Robinhood LearnWhat is the Nasdaq?Picture your one tech-obsessed buddy (everyone’s got one)… She learned to code before she could text. That’s like Nasdaq. Born out of tech innovation, it is known for attracting tech companies to list their shares for IPOs.
See Also
How to Save Money on Your Water Bill — From Pennies to PlentyHow to Find the Most Volatile Penny Stocks - The Trade LockerWhat To Do When You Run Out Of Money For The Month10 Ways to Save Money While You're Living Paycheck to Paycheck
Updated Dec 14, 2023Robinhood LearnWhat is Capital Gains Tax?Capital gains tax is a tax on the profit made from the sale of an asset (e.g., stock, property).
Updated Dec 06, 2023Robinhood LearnWhat is Common Stock?Common stock is like general admission at a concert, while preferred shares are the VIP passes… Both types of stocks are slices of ownership in a company, and typically come with voting rights, or even perks like income paid back to shareholders.
Updated Sep 18, 2023Robinhood LearnWhat is an Option?An option is a contract that gives its owner the right to buy or sell a certain security, at a certain price, up to a certain date.
Updated Sep 18, 2023Robinhood LearnWhat is EPS?EPS is one tool to help investors get to know a stock… Earnings per share shows what part of a company’s total profits is “owned” by each individual share. Tracking a company’s EPS over time helps you assess the stock’s change in value over time.
Updated Apr 19, 2023Robinhood LearnWhat is a Limited Liability Company (LLC)?Setting up an LLC is like getting a flu shot for your finances... It helps protect your personal finances against liabilities that might hit your company in the future. And—just like a flu shot—the protection isn't absolute, but it usually helps.
Updated Apr 18, 2023Robinhood LearnWhat is Perfect Competition?Economists think it would be great if every market was perfectly competitive, and you could get identical products for the same price everywhere. But at the end of the day, it’s a scenario that just doesn’t exist.
Updated Mar 30, 2023Robinhood LearnWhat is a Credit Union?A credit union is like a community garden. A group of people own a small plot of land (the credit union), and everyone brings seeds (cash deposits). Membership in the garden is restricted to a certain group—people who live in the neighborhood.
Updated Mar 30, 2023Robinhood LearnWhat is Over-The-Counter (OTC)?Over-the-counter (OTC) trades are like selling your car on your own. You don’t get the advantage of the system designed to bring buyers and sellers together. But you also don’t have to pay a listing fee or follow the rules of the exchange.
Updated Mar 29, 2023Robinhood LearnWhat is a Command Economy?If a command economy were a puppet show, the government would be the puppeteer. In a command economy, the government makes all the major economic decisions. It controls all means of production in a country.
Updated Mar 29, 2023Robinhood LearnWhat is an Ex-Dividend Date?The ex-dividend date is like a train taking off from the station... It’s a cut off point that defines if an investor buying a stock (that offers dividends) will be eligible or not to receive them.
Updated Mar 29, 2023Robinhood LearnWhat is Macroeconomics?Similar to the way a national weather report looks at how conditions could result in above or below average temperatures throughout the country, macroeconomics looks at how market forces are shifting at a large scale.
Updated Mar 29, 2023Robinhood LearnWhat is an Inferior Good?An inferior good is like a high school friend. As you get older, you find new things and friends to occupy your time. But your improving situation — and seeing your old friends less — doesn’t mean they were a worse friend than your new ones.
Updated Mar 29, 2023Robinhood LearnWhat is an Original Equipment Manufacturer (OEM)?The original equipment manufacturer produces the first step in someone else’s final product. You can’t get the final product without the purchase from the OEM, but there’s still more work to be done.
Updated Mar 29, 2023Robinhood LearnWhat is a Portfolio?A portfolio is your investment pie. Each asset represents a slice of the pie, whether it be stocks, bonds, mutual funds, exchange-traded funds (ETFs), cash, etc. The size of each slice is proportionate to how much you own.
Updated Mar 29, 2023Robinhood LearnWhat is Frictional Unemployment?Frictional unemployment is like a swimmer taking a breath. We all understand it’s just part of the process. Likewise, we don’t expect a person to keep the same job they get at 16 until they retire. It’s normal to look for new opportunities.
Updated Mar 29, 2023Robinhood LearnWhat is Next of Kin?Finding a person’s next of kin is like looking for the next branch to reach for when climbing a tree. When you’re looking for a person’s next of kin, you examine the person’s family tree, moving to find their closest living relation.
See Also
50+ Brilliant Ways To Save Money – Part 1 - Our Happy Hive
Updated Mar 29, 2023Robinhood LearnWhat is Reconciliation?Reconciliation is like checking your homework against an answer sheet. If there are inconsistencies, either you or the answer sheet has an error. To understand the material, you will have to reconcile the different answers until the results match.
Updated Mar 29, 2023Robinhood LearnWhat is a subsidiary?A subsidiary is like a tool in a Swiss Army knife. It serves a specific purpose for its parent company, making that parent company more valuable.
Updated Mar 29, 2023Robinhood LearnWhat is Weighted Average Cost of Capital (WACC)?WACC sets the lowest bar (rate of return) an investor needs to get over in order to make a positive return on their investment. Anything below this bar means you should probably be putting your money elsewhere.
Updated Mar 29, 2023Robinhood LearnWhat is a Balance Sheet?A balance sheet is like taking a financial portrait of a company with a polaroid camera... It’s a snapshot, taken at one point in time, that helps capture a company’s health by showing the value of its assets, liabilities, and shareholders’ equity.
Updated Mar 29, 2023Robinhood LearnWhat is Retirement Planning?Retirement planning is like planting a tree. Like growing a tree from a sapling, retirement planning can’t be done overnight. It takes a long time of careful planning and effort to grow a strong retirement that you can enjoy.
Updated Mar 29, 2023Robinhood LearnWhat is the Money Market?The money market is like a weekend getaway. It’s easy and quick because it’s not a long-term commitment. You can usually pull your investments out at any time without too many repercussions or transaction fees.
Updated Mar 29, 2023Robinhood LearnWhat is Ex-Dividend?Buying a stock ex-dividend is like waiting in line for a rollercoaster. Everyone behind a certain point has to wait for the next trip (the next dividend). If you counted the people before you and the no. of seats, you can determine the cut-off point.
Updated Mar 29, 2023Robinhood LearnWhat is an Automated Clearing House (ACH)?The Automated Clearing House (ACH) Network is like email for money. Instead of paper checks moving around the country, like paper mail used to, it's the electronic equivalent. It's cheaper, faster, and more reliable, but the basic logic is the same.
Updated Mar 29, 2023Robinhood LearnWhat is Scarcity?Scarcity is like having two sandwiches for four people. You may have to get creative, cutting the two sandwiches in half for four people. Or, you might sell the sandwiches to the two highest bidders, in which case the price of a sandwich will go up.
Updated Mar 29, 2023Robinhood LearnWhat is Opportunity Cost?Imagine a balancing scale... Every choice comes with some kind of trade-off — aka opportunity cost. It’s important to factor that cost into your decision-making process to avoid major losses.
Updated Mar 29, 2023Robinhood LearnWhat is Indemnity?A misfortune like your house burning down — or being sued for professional negligence — could wipe you out financially. But sometimes you can get out of this type of jam if you’ve paid an insurance company to indemnify you against such losses.
Updated Mar 29, 2023Robinhood LearnWhat is Commercial Real Estate (CRE)?Commercial real estate is like setting up a lemonade stand in your driveway. That site is commercial real estate, because its purpose is business - to sell lemonade. But your home itself is residential - its purpose is to be lived in.
Updated Mar 29, 2023Robinhood LearnWhat is a Trust?A trust is like a safety deposit box that someone else holds the keys for. The deposit box holds something valuable, but you don’t have the key to open the box to get what's inside. Instead, you have to ask the trustee to open the box for you.
Updated Mar 29, 2023Robinhood LearnWhat is Annual Percentage Rate (APR)?An APR can help you gauge how much a loan or credit product might cost. But you’ll need more information to estimate the true cost, such as how fast you intend to pay it off, whether additional costs are excluded, or the effect of compound interest.
Updated Mar 29, 2023Robinhood LearnHow to start investing for as little as 1 dollarInvesting in the stock market doesn’t mean you need to have thousands, or even hundreds of dollars to get started. Even if you have just one extra dollar, fractional shares (which are offered on Robinhood) can help you build your portfolio.
Updated Mar 29, 2023Robinhood LearnHow can I start budgeting? Learn how to spend, save, and investBefore you can save or invest, you probably have to cover the basics: food, housing, healthcare, transportation, and insurance. If you’re able to, it’s helpful to spend less money than you earn. It’s one of the keys to building wealth.
Updated Mar 29, 2023Robinhood LearnWhat is a bid/ask spread?For every stock or options contract, there is an ask price, which is the lowest price a seller is asking for, and a bid price, or the highest price a buyer is currently willing to pay. The difference between the bid and ask price is called the bid/ask spread.
Updated Mar 20, 2023Robinhood LearnHow to read an S-1If a company wants to go public in the US, it must file a Form S-1 with the Securities and Exchange Commission. Also called a registration statement, the form includes details on the company’s business, managers, future plans, and finances.
Updated Feb 21, 2023Robinhood LearnWhat can I invest in? An overview of assetsInvesting is the act of purchasing an asset in the hope that it will deliver some profit, potentially through appreciation, dividends, or interest. Examples of investments include stocks, bonds, ETFs, and real estate.
Updated Dec 29, 2022Robinhood LearnI’m in my 20s — How should I approach investing?At Robinhood, we’ve got a BOMB acronym to help you think about your financial life. So, here are four tips on how to Budget, Organize, Maximize, and Balance your finances to help tee up your investing journey.
Updated May 17, 2022Robinhood LearnWhat is a crypto wallet?Crypto wallets provide you with secure access to your crypto for managing, spending, and sending.
Updated Feb 02, 2021Robinhood LearnWelcome: Investing 101Ready to invest, but don't know where to start?
Updated Jan 15, 2021Robinhood LearnWhat’s the purpose of a diversified portfolio?A diversified portfolio is kind of like a nutritious diet... The better you spread your investments across different assets, the less likely they are to all experience a loss. Or in other words, your aggregate losses will likely be less severe.
Updated Jan 15, 2021Robinhood LearnPicking an investment: How to approach analyzing a stockInvesting is like shopping for a car, but more consequential. You start with your personal needs, style, and objectives. Consider different makes and models, and compare choices based on key metrics. Then, make a decision that works for you.
Updated Jan 07, 2021Robinhood LearnDoes a market “selloff” mean long-term investors should sell?Long-term investing is like seeking cover during an earthquake. Basic preparedness, like staying away from windows and heavy furniture, can help you stay strong during a difficult time. Likewise, long-term investing usually requires calm and caution.
Updated Jan 07, 2021Robinhood LearnInterest rates are at their lowest since 2008 — What does that mean?Adjusting the fed funds rate is like training as a weight lifter. The Fed raises interest rates (adds weight) to make loans more expensive, helping to manage inflation. To boost the economy, it lowers rates (removes weight) to make borrowing cheaper.
Updated Jan 07, 2021Robinhood LearnWe’re in a bear market — So, what does that mean?Investing in a bear market is kind of like bungee jumping. History indicates that the stock market bounces back from its declines. However, you must be aware, the bottom could fall out, leaving the economy and your investments in freefall.
Updated Jan 07, 2021Robinhood LearnThree charts that help explain this year’s stock market volatilityThe stock market’s reaction to COVID-19 has been, well, vicious. Here, we reflect on how the 2020 decline compares to other historic drops, what investors are paying for bonds, and how the Fed’s interest rate policy compares to recent history.
Updated Nov 25, 2020Robinhood LearnBitcoin’s mining reward is about to be cut in half — What investors should know about the “Halvening”Every 210,000 blocks, the reward for mining bitcoin gets cut in half, a process that’s designed to repeat until 21 million units have been created. Based on current activity, the “block reward” is expected to drop to 6.25 bitcoins on May 11, 2020.
Updated Nov 25, 2020Robinhood LearnThree things to do before you start investingYour investment plan starts with a few key questions: Where are you now? And where do you want to be in the future? You can prepare to invest by reflecting on your goals, paying off high-interest debt, and creating an emergency fund.
Updated Nov 25, 2020Robinhood LearnInvesting during times of uncertaintyEverything about 2020 has been unprecedented, from COVID-19 to the US presidential race. This year, millions of new investors experienced the stock market’s highs and lows, a reflection of the uncertainty that gripped our nation.
Your financial journey starts here | Robinhood Learn (2024)
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