> Keep in mind that Robinhood also gives everyone a margin account by default.
While this is technically true, it is not a typical margin account. People cannot invest more money than they put into their Robinhood account. In order to do that, they need to switch to RH Gold.
RH Basic: I put $100 into the account, I can buy $100 worth of stock before my funds clear. (Robinhood Instant)
RH Gold: I put $100 into the account, I can buy $200 worth of stock. (Actual effective margin)
While both of these are technically margin accounts, most people associate the term "margin investing" with the latter model which requires $2000 in the account and a deliberate choice to upgrade.
While this is technically true, it is not a typical margin account. People cannot invest more money than they put into their Robinhood account. In order to do that, they need to switch to RH Gold.
RH Basic: I put $100 into the account, I can buy $100 worth of stock before my funds clear. (Robinhood Instant)
RH Gold: I put $100 into the account, I can buy $200 worth of stock. (Actual effective margin)
While both of these are technically margin accounts, most people associate the term "margin investing" with the latter model which requires $2000 in the account and a deliberate choice to upgrade.