Which is Best For You?

Investing robo advisors have changed how people invest. By automating much of the investment process and allowing people to get started with smaller amounts of money than traditional brokerages require, robo advisors have opened up the investing world to new generations of people.
Still, it’s vital to understand exactly both how robo advisors work and how your investments work within them.
We’ve broken down just that when it comes to Wealthsimple, Wealthfront and Robinhood right here.

What’s in This Comparison?

About Wealthsimple
Based in Toronto, Wealthsimple was founded in 2014 by Michael Katchen. As of May 2019, it has over C$4.3 billion in managed assets. Each client who uses Wealthsimple also has access to a live investment advisor who helps them create a unique portfolio.

About Weathfront
A California-based robo advisor, Wealthfront was founded in 2008. It was originally created as a mutual fund analysis company by founders Andy Rachleff and Dan Carroll. With a mission to “help democratize access to sophisticated financial advice,” the duo decided to make Wealthfront a wealth management and education platform for people who weren’t served by traditional investment firms. As of 2018, it was the second-largest robo advisor operating in the U.S.
About Robinhood
Robinhood is a robo investor platform founded by Vladimir Tenev and Baiju Bhatt and launched in California in 2013. The platform offers fee-free trading services for taxable accounts via its app and the web. 100,000 users signed up for Robinhood within 30 days of its launch, and as of May 2019, the platform’s assets were valued at $5.6 billion.
There’s been a bit of a recent scandal, though. In late 2018, Robinhood announced that it would begin offering checking and savings accounts with a 3% interest rate, significantly higher than the national average. Within a few days, though, it became clear that these accounts were not insured by the Securities Investor Protection Corp. (SIPC) despite Robinhood saying that they were. In fact, the accounts weren’t eligible for any insurance coverage from the SIPC. Obviously, that project has been put on indefinite hold.
How Are They the Same?
All three services offer many features. First, let’s take a look at how they’re similar.
Investment Account Types
All three offer taxable accounts.
Investment Types
All three services allow you to invest in exchange traded funds (ETFs).
Mobile Apps
All three services emphasize investing with an Android or Apple mobile device.
How Are They Different?
Here are some of the big differences among the three sites.
Platform Purpose
Wealthsimple and Wealthfront are robo advisors, while Robinhood is a DIY trading platform.
Investments Offered
Wealthsimple and Wealthfront offer predesigned portfolios centered around ETFs. Robinhood allows users to invest in individual ETFs, stocks, options and cryptocurrencies.
Wealthsimple and Wealthfront both charge annual advisory fees. Robinhood is completely fee-free.
Minimum Investments
Neither Wealthsimple nor Robinhood require a minimum investment to get started. Wealthfront requires an initial deposit of $500.
Unique Features
Wealthsimple offers socially responsible investing (SRI) opportunities at a rate that is unprecedented. For example, there’s a halal investing portfolio that complies with Islamic law. It contains around 50 individual stocks that are filtered by a non-Wealthfront managed group of Shariah scholars and experts.
What makes a stock halal approved? It can’t be a company that profits from gambling, alcohol, guns or tobacco.
Beyond this specific feature, Wealthsimple offers investment opportunities in companies with dedications to clean tech, low carbon emissions, gender diversity, local initiatives and affordable housing. Note that the SRI management fees are higher than non-SRI funds, so you will pay more for your beliefs.
Wealthsimple also offers a savings account with a generous interest rate, spending round-up investment options and a free portfolio review. The review is free to anyone — not just Wealthsimple customers.
Wealthfront offers cash accounts to its users. With an APY of 2.29%, these are accounts where you can stash some savings at a higher interest rate than most banks, and the money isn’t actively invested. Your cash is protected up to $1 million, quadruple the FDIC insurance guarantee of $250,000.
Robinhood is best known for being 100% fee-free. Plus, it’s easy to use — simply download and start trading! The platform also offers cryptocurrency trading in certain states.
Minimum Investment
Wealthfront requires a $500 minimum deposit for its low-fee index fund investment accounts.
Neither Wealthsimple nor Robinhood requires a minimum deposit.
Wealthsimple charges a 0.5% fee for balances of $99,999 and less, and a 0.4% fee on balances above $100,000.
Wealthfront charges an annual advisory fee of 0.25% on all assets under management in investment accounts. Wealthfront also offers cash savings accounts, and there are no fees for those.
Robinhood has no annual fees, no trading fees, no transfer fees and no account minimum for regular accounts. (There is a $2,000 minimum for the Robinhood Gold account, which is the regulatory minimum.) One of Robinhood’s biggest strengths is how few fees come with the service.
Winner — Robinhood wins for being totally fee-free.
Standout Features
Wealthsimple stands head and shoulders above both Wealthfront and Robinhood when it comes to ethical investments. It’s one of the biggest robo investors in the world, and it also has arguably the most options for socially responsible investments.
Wealthfront makes a sincere effort with its customer service in a way that neither other platform does.
Robinhood has remarkably low fees throughout its platform. Since there are no fees for trades, frequent traders can save a lot of money by using it.
Winner — Wealthsimple, Wealthfront, and Robinhood all win for offering standout features.
Customer Service
Wealthsimple has a Help Center on its site where you can ask questions and find answers from the Wealthsimple team. There’s also a phone number you can call between 9 a.m. and 8 p.m. Eastern Time Monday through Thursday and 9 a.m. and 5:30 p.m. on Friday. You can also send an email anytime.
Wealthfront offers an abundance of information on how to use its website and services in its Help Center. On top of that, there are videos from leaders in the industry that explain investing concepts.
Robinhood has a support email address you can direct questions to, as well as a Frequently Asked Questions section of the site and a Help Center.
Winner — Wealthfront has the best options when it comes to customer care.
Wealthsimple uses a 256-bit SSL certificate to encrypt all information transmitted between your browser and the servers. The platform backs up its system multiple times a day, seven days a week. There is also an option to report a security issue to the Wealthsimple team via an online form, but when I clicked on it in June 2019, the link was broken.
Wealthfront has a lot of language about security on the site, but none of it is very specific. The robo advisor says it uses third-party firms to test security but not which ones. There’s an internal security system team that “monitor[s] numerous security sources,” but again, there are no details provided on these activities. Wealthfront does stress that it will never sell any information you provide, and the site undergoes an annual safety procedure audit from Ernst & Young. Assets are held by a third-party custodian, Apex Clearing, and Wealthfront has access to your money only to withdraw its fees.
Robinhood is a member of FINRA and SIPC. It does share some user information with third-party organizations, mainly for advertising and marketing. Like Wealthfront, there is a lot of language in the Terms and Conditions around information sharing with third-party platforms, but it doesn’t specify what those platforms are.
Winner — Despite the faulty contact link, Wealthsimple is the most transparent when it comes to security.
Who Are They Best For?
Wealthsimple is best for younger investors who want a platform to grow with. The focus on different types of accounts and the array of investment options mean the platform will grow with its users as they age and their financial goals change. Wealthsimple also strives to be transparent through its blog and tries to build a real relationship with its users. It provides some financial education and interviews via blog posts as well, although without as much of a purely educational focus as Wealthfront.
Wealthfront is a great way for new investors to get started with their investment accounts. The minimum deposit is low enough for even those who are lower income or working on an introductory salary to be able to swing it. With a hands-off approach, Wealthfront is also an attractive option for people who don’t have the time or desire to manage their investments manually.
Robinhood is best for frequent traders who have retirement accounts elsewhere. Since Robinhood doesn’t offer retirement accounts, all accounts are subject to capital gains taxes. Investors should use this app only after they are comfortably able to contribute to their retirement accounts and have more money to invest.

Which Is the Best?
For younger and lower-earning investors, any robo investing platform is a great way to simply get started in the market. The earlier you can start investing, the better off your investments are likely to be. With all of their low or totally free buy-ins, each of these robo investors can be your gateway to the market.
Which one is best for you specifically will depend on the type of portfolio you want to build and how frequently you want to trade. Robinhood is best for frequent traders, while both Wealthsimple and Wealthfront have a more robust offering of types of accounts and socially responsible investing opportunities.

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