12/19/2023: Have You been Robinhooded?

Robinhood has been running a promotion to attract assets, offering a 1% bonus for transferring assets from another brokerage account into a Robinhood account. There is no limit to the amount that can be transferred, and the bonus is deposited into the customer's brokerage account when the transfer is completed. In other words, if you are a billionaire and transfer $1B into Robinhood, you will earn a $10M bonus instantly. It’s basically crypto level free money.

According to a WSJ report, Robinhood received about $1.1 billion in account transfers since Oct. 23, when it began offering a 1% match on transferred brokerage accounts, the company said. In the second and third quarters of this year, customers transferred about $350 million and $375 million, respectively, to Robinhood from other brokerages. The bonus does have a two-year earn-out period. If you transfer the assets out of Robinhood during the two year period, your bonus will be reduced pro rata. I believe Robinhood will be able to make 1% back from the customer assets through trading and stock lending so this is quite a smart move. Plus, HOOD 0.00%↑ stock soared more than 40% since October 23.

Schwab is my primary brokerage. I asked if they had any matching program to respond to Robinhood’s campaign, I didn’t get a response so I rage transferred some assets to Robinhood. (I actually signed up for Robinhood just for this offer.) Schwab can get into big trouble if a significant amount of assets flows out as they have a lot of unrealized losses on the balance sheet. My transfer completed a couple of days ago and I got my bonus!!! The process is so easy. I used the bonus to splurge on a fancy piano. A Christmas gift for myself! It’s awesome!