Can I day trade crypto on Robinhood?
Robinhood is a professional stocks investment llc and mobile app that has helped several make their first investments. Their application makes it incredibly simple to go from living no experience in cryptocurrency exchanges to tap the first trade. But the question is are you aware of risk exist in day trading cryptocurrency and if so should you do it on Robinhood?
Why make short-term crypto trades?
Statistically, you probably would not want to do short-term trading, period. There is no set standard available on this subject, but numbers floating around us imply that less than a percent of traders are doing profitable gains. Popular records show that the cryptocurrencies trading is likely to be a serious mistake for the vast majority of new investors.
An investor who do trading frequently is often looking for better returns, trading regularly boosts the need to manage fear and to cope with the exhaustion of losing. It is also a high risk, on a spectrum of investment plans, from purchasing and holding an index fund to day trading (unadvisable), the second one for sure on the riskiest end of the moves.
However, crypto trading intrigues investor because of the potential outcomes. The profitable trader is capable to sit at his laptops with multiple marked strategies and is making enough revenue according to their capabilities.
Is it hard to do day trade crypto on Robinhood?
The short answer is: No. Unlike the stock market investment or securities, you don’t need a 25K dollar portfolio to make more than five intraday trades each week. Because the digital asset market never closes, you can trade at any day or time of the week with minimum capital and transactions fee.
Freedom and smoothness like this can make crypto trading extremely enticing to a beginner. Just you need to do, after getting your account setup ( Always read conditions and disclosure. see the companies requirements and your local legal restrictions before investing) and deposit your personal funds in fiat (always mind your purchases and deposits), is to head over to their instant online listed markets of known cryptocurrencies. From there, just search the symbol and type in how much crypto-asset you would like to buy in usd $ and then submit an order. Afterward, you’re open to sell your holdings instantly without any issues. If you find any issue go to their technical support program they all have dedicated support team.
At Robinhood, you are not actually buying crypto
It only allows you to wager on the price of crypto. Other sites like coinbase, which allows you to buy bitcoin BTC and other leading tradeable coins and use them for other purposes like sending it to your friends, withdraw, purchasing and paying for goods, or using it in other blockchain projects. If you’re still determined in crypto-assets as an investment, it can be a fine solution for your inspired objectives.
Your investment’s worth will grow as it’d purchase it from anywhere else, but if you sense to have more choices and fast one window panel then there are hundreds of the advanced brokers as it involves a bit more complicated procedure. You’d have to convert into physical money, withdrawal your money from Robinhood, and buy it elsewhere. This’d involve charges, a waiting time, as well as the risk of its worth changing.
Fees of Robinhood or the lack of thereof
The business promotes itself as a commission free, but everyone knows that nothing is free. It’s reported that Robinhood makes income through interest, margin interest and additional premium accounts, but what you’ll immediately notice as a purchaser is that price spread.
Because the website is a middleman among BTC and owners and the users who want to get advantage from the growth of BTC the company needs a few ways of obtaining revenue. This is why they have an estimated displayed price that’d be different from the actual number of BTC.
The difference among the value offer is roughly 0.1 percent which is the exact as on any other exchange.
Day trade crypto alternatives to Robinhood
There’re also lists of great options other then Robinhood for day trading. A lot of these alternatives will need you to use VPN, though. Binance is a great choice with huge green volume and marketing, but they’re closed for US and apply restriction to accounts based in USA. They also have know your consumer policy kyc. In other words, you’ll need to prove your residency to use the crypto exchange.
Others sites like BITMEX don’t use know your consumer policy, but it’s against their policy to give service to US residents. If you do start your financial activity in it without using a VPN your assets can be frozen and held limited after a couple of offenses.
Kraken exchange is also day trade friendly and gives services to US customers other than dallas, NYC and Washington DC. Beside other factors the main drawback to this website is that there are not so many margins or position options as compare to the other brokerage.
Still, if you are not scalping and have the un-assured wish to try using the swings, Robinhood is extremely simple to use and profitable. Now while writing this article, BTC has increased in value, which is more than any spread that you will deal with.
The only thing that you’re incapable of doing on Robinhood is taking a short position. It mightn’t be the winner crypto platform to learn and execute crypto day trade, but eventually, you will realize that there’re better exchanges with more tools to make money.
Should you do day trading in crypto at all?
Day trading is already a massive practice among people like banks advisors, experts, stockbroker and entrepreneur with proper risks management. For beginners, it is one of the biggest risk investment plans you can have. It also exercise an immense amount of efforts and continues engaged power. But another point of view consider is that it may cost you, your cash. All depending on your jurisdiction, every crypto trade could be in the event of a capital gains tax and could send you among taxpayers. That can easy add up to a gigantic tax bills at the end of the year that you need to to pay.