Vanguard is better suited for long-term investors who prioritize low expense ratios and a wide range of investment options, including mutual funds and bonds. Robinhood is more appropriate for active traders interested in stocks, ETFs, options, and crypto, who value a user-friendly platform and 24/7 customer support, and are comfortable with limited research resources.
| Attribute | Vanguard | Robinhood |
|---|---|---|
| Investment Options | Stocks, ETFs, mutual funds, bonds, options, and money market funds. | Stocks, ETFs, options, and cryptocurrencies. Access to over 650 foreign companies through ADRs. Does not offer mutual funds or bonds directly, but provides access to bond ETFs. Futures trading is also available. |
| Account Minimums | Target Retirement Funds and STAR Fund: $1,000. Most index mutual funds: $3,000 for Admiral Shares. Most actively managed mutual funds: $3,000 for Investor Shares; $50,000 for Admiral Shares. Vanguard Digital Advisor: Requires $100 to start investing. ETFs: No fixed initial minimum investment. | $0 minimum deposit for standard accounts; $2,000 minimum for margin trading; $25,000 minimum equity for Pattern Day Traders in margin accounts. |
| Commission Fees | Online trades of Vanguard ETFs and mutual funds: $0. Stocks: $0 per trade for US-listed stocks. Foreign equity: Commission of 0.20%. Options: $1 per contract. Broker-assisted trades: $25. No-transaction-fee (NTF) mutual funds: A $50 early redemption fee applies for sales within 60 days of the most recent purchase. Foreign securities and ADRs: 1% of the gross dividend amount is charged when foreign tax withholding relief is received on a dividend. Account closure and transfer fee: $100 may be charged. | Commission-free trading for stocks, ETFs, and options. Regulatory fees apply. |
| Expense Ratios (for Funds) | Vanguard average ETF and mutual fund expense ratio: 0.07%. ETFs: 0.06%. Admiral Shares: 0.14%. Investor Shares: 0.27%. Institutional Shares: 0.08% (minimum investment of $5 million). | Does not specify expense ratios for ETFs, but offers research tools to evaluate them. Does not offer mutual funds. |
| Trading Platform (Web, Mobile) | Vanguard offers both web and mobile platforms. The platform is designed to support gradual growth rather than frequent trading. | User-friendly trading platform via web and mobile. Robinhood Legend desktop platform with advanced charting launched in 2024. |
| Research and Educational Resources | Vanguard provides a range of information sources, along with planning and calculation tools. | Limited within the app, but more robust on the desktop version, though still less comprehensive than full-service brokers. |
| Customer Support Quality and Availability | A $25 broker-assisted commission will be charged each time you want to call up and speak to someone and get help purchasing or selling a Vanguard mutual fund or Vanguard ETF. | 24/7 customer support via phone line. |
| Account Types (Taxable, Retirement) | Individual, joint, Roth, Traditional, SEP-IRA, SIMPLE IRA, UGMA/UTMA, education savings accounts, 401(k), 403(b), 529 savings plans, trust accounts, and cash plus accounts. | Individual and retirement accounts (IRAs). |
| Margin Rates | The base rate for Vanguard Brokerage Services is 10.25% (subject to change). For balances under $19,999, the margin rate is the base rate plus 2.50%. The mandatory minimum deposit for margin accounts is $2,000. | Tiered margin rates ranging from 5.7% to 6.75%, based on the margin balance. Gold subscribers get their first $1,000 of margin with no interest. |
| Security and Insurance | Vanguard is regulated by the Financial Conduct Authority (FCA) and covered by the Financial Services Compensation Scheme. | Regulated by the SEC and FINRA, member of SIPC (insurance up to $500,000 for securities, including $250,000 for cash). Encryption, two-factor authentication, biometric logins. Cash balances swept into FDIC-insured banks (insuring up to $250,000 per user). Cybercrime insurance for its own crypto holdings. |
| Fractional Shares | Vanguard offers fractional shares for ETFs and mutual funds. You can buy Vanguard ETFs for as little as $1. Fractional shares are not available for individual stocks. | Offers fractional shares of stocks and ETFs, allowing investment with as little as $1. |
| Automated Investing/Robo-advisor Options | Vanguard Digital Advisor provides automated investing using Vanguard ETFs. The advisory fee is approximately 0.15% per year. The minimum investment for Vanguard Digital Advisor is $100. Vanguard Digital Advisor offers tax-loss harvesting. | Robinhood Strategies robo-advisor platform, with a minimum investment of $50. |