Webull is a commission-free broker that is getting a lot of press lately, having followed in the heels of Robinhood. One only needs to glance at the Google Trends Webull graph for 2020 to see how it has blown up lately:
In order to help people properly understand Webull, I spent many hours digging into the company and putting together this FAQ. Comment below if you have any further questions, and if you’ve used Webull yourself, please submit a review. 🙂
How does Webull compare to Robinhood?
There are a few differences:
- Webull offers short selling (though you can’t expect them to have borrows on hard-to-borrow stocks that brokers like Interactive Brokers or Centerpoint may have), whereas Robinhood does not offer short selling
- Webull’s trading platform offers more features (see below for a rundown of the features in Webull’s platform) such as a stock screener, paper trading and technical indicators
- Webull offers pre-market and after-hours trading like you’d expect, though will Robinhood you have to pay for that (via Robinhood Gold)
- Webull offers IRA accounts
Webull definitely feels like a better version of Robinhood, as it does almost everything Robinhood does and significantly more beyond that. The only benefits I see to Robinhood over Webull is that Robinhood offers fractional share trading, along with crypto trading (As of March 2020 Webull is working on crypto).
How does Webull work for day trading?
Webull is definitely catered towards day traders over long-term investors, as the more frequently you trade the higher your commissions would normally be, and a commission-free broker will save you a ton of money over the long term. However, it’s still of course subject to the pattern day trader rule (no more than 3 round trip trades within a 5 day period if you’re trading with less than $25,000 USD).
The disadvantages for Webull with day trading is that you don’t get to choose what market maker to route your order to (as explained below, Webull makes this decision for you and makes a bit of money by routing orders to certain market makers), which won’t matter for highly liquid stocks but may result in worse executions when you’re trading illiquid and especially OTC stocks. Also, their margin rates are much higher than many other brokers, so I strongly advise against day trading with them if you need to use any kind of margin as the margin fees will likely outweigh the commission-free trading.
Is Webull insured?
Yes. Webull is covered by SIPC insurance, which covers up to $500,000 in securities or $250,000 in cash for each account. There is also insurance from Apex Clearing Corporation up to $150 million in total.
Can I get a free stock with Webull?
Yes. Webull has a referral system where if you join up under someone’s referral link, you get a free stock (or two). It’s random what stock you’ll get, but you can expect the value to be somewhere around $10-20, so it’s worth doing.
Is Webull’s customer service any good?
Webull has good customer support that will get back to you quickly, though they still lack a live chat support feature.
How do dividends work with Webull?
Dividend payments with Webull work just like with any other broker. If a stock you’re holding has a dividend payment, you’ll see the cash in your account on the payment date or the day after.
Does Webull have a good trading platform?
Webull’s trading platform isn’t revolutionary by any means, but it’s definitely perfectly sufficient for most needs. Here’s an example of what the web-based platform looks like:
Webull also offers a trading app for Android, iOS, Windows and Mac. Here’s what you get with it:
- The ability to place different types of orders like limit, market, stop orders etc. (as you’d expect)
- A watchlist that you can add/remove stocks to
- A decent stock screener that looks like this:
Webull’s screener lets you screen by many metrics including market cap, price, % change (that’s the one you’ll always be using on a day-to-day basis), volume, turnover rate (the number of shares traded divided by outstanding shares) and listing date. There are also a bunch of financial indicators like EPS and dividend yield you can filter by, as well as technical indicators (I don’t use these personally).
While Webull does a good job with their filter and it’s definitely useful, I personally prefer Finviz’s free online stock screener here (that link will take you to the screener I use every day, which is simply volume over 100,000 and up over 10% on the day) because it shows a thumbnail of the charts, unlike Webull that just gives you the numbers.
- A paper trading screen where you can practice trading (standard in many trading platforms)
- Technical analysis tools that you can add to the chart
- Fundamental analysis tools showing a companies income statements, balance sheets, cash flow etc.
- An economic calendar listing showing upcoming IPO dates, news and earnings reports
What’s the catch with Webull?
The premise of Webull (commission-free trading with no inactivity fee) sounds extremely appealing, so it’s not surprising it’s got popular. However, there are a number of things you should be aware of:
You can only trade US stocks and ETFs on Webull(UPDATE March 2020: Webull now offers options trading, and appears to be working on bringing crypto trading to the platform as well)
- You can only deposit and withdraw via bank transfer, not credit card (not that we would recommend that!) or electronic wallet
- As of March 2020, there is no live chat on the website (though they added a telephone number) which is always my preferred way of contacting a broker
- Webull only accepts customers from the US, China and India
- While Webull offers commission-free trading, you’ll still be charged margin fees ranging from 3.99% (for over $3 million) to 6.99% (up to $25,000), which is higher than many brokers (the stock trading broker I usually trade with, for example, Interactive Brokers, offers far lower margin fees). If you’re trading on margin, you may find that Webull isn’t the cheapest broker for you despite its commission-free trading
- There are still SEC and FINRA trading fees, though these are very low (SEC trading fees are $0.0000221 * Total $ Trade Amount, FINRA trading fees are $0.000119* Total Trade Volume – both for sells only)
- If you’d like data for many different exchanges (Toronto stock exchange, Taiwan stock exchange, London stock exchange, Hong Kong stock exchange etc.) it’ll cost you a monthly or annual fee. Costs are between $2.99/month and $59.99/month
- You should be aware that Webull makes money by directing order flow. Instead of having an order screen where you get to choose what market maker you want to place your order through, Webull gets to make this decision for you, and market makers pay Webull for sending orders their way
Here are the user reviews we’ve received for Webull so far. If you’ve used Webull, please also submit your own review.
I've recently started using Webull for some online trading to understand the platform better. Previously, I used Interactive Brokers because of their low trading commissions compared to competitors like Scottrade, TD Ameritrade, Charles Schwab, etc. However, with the rise of brokerages like Robinhood and WeBull, paying for any trade is a waste of money. Therefore, I decided to give the service a try.
I enjoy the sleek interface as well as useful trading information about a number of stocks that I follow. Personally, I prefer their layout to Robinhood's, presumably WeBull's most direct competitor. It is more geared toward technical analysis and comes free with your account.
I have looked at WeBull's community postings (message boards for commentary) on the various stocks I watch, and while most of it can be spam, it is useful for some insightful thinking if you sort through enough comments. I don't see this feature on many other brokerage apps and think it *could* be a differentiator if it adds value.
You can also make predictions on price performance and earn points for guessing correctly. Earn enough and your username can garner followers based on your expectations. Also useful for those hoping to learn from great investors. It combines Motley Fool with Robinhood.
--Riley Adams, Young and the Invested
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