With the increasing popularity of financial technology (fintech), it’s not surprising that technology would spill over into trading. That’s the core concept behind Webull. At its heart, Webull is a fintech company that started as a research platform and has now expanded to become a zero-commission trading source.
Zero-commission trading has attracted a new generation of traders to the stock market. These investors are already technologically savvy. The ability to buy and sell stocks using the same kind of app that allows them to place an order from Uber Eats, is one reason that platforms like Webull are growing in popularity.
Webull’s most notable competitor is Robinhood. But the zero-commission space is filling up rapidly. However, not all trading apps are the same.
In this article, we’ll provide you with an overview of Webull that can be the foundation for you to compare the app with other competitive trading sites. Some of the basic questions you should ask of any trading site are as follows:
Is this a reliable trading app? What kind of investors does it appeal to? What kind of trading does it offer? What additional tools does the app offer? What fees are involved?
At the end of the article, you’ll be able to answer these questions and more in deciding if Webull is the right trading app for you.
Who Uses Webull?
The short answer is that Webull is targeting the millennial investor that has made the Robinhood trading app so popular. However, Webull is designed for any trader who believes in the importance, and power, of knowledge. And, it targets the undercapitalized (less than $100,000 to fund their account) part-time trader who is willing to assume the risk and potential reward of managing a self-directed portfolio.
Webull is also good for swing traders. These investors are typically only looking to capture a gain in a stock over just a few days or several weeks. Unlike full-time day traders who are looking for any small fluctuation that can occur during a trading day, swing traders are looking for massive moves in one direction or another. These investors are an ideal target for Webull’s research platform that acts as a charting platform and stock screening tool.
When Webull first started in 2017, it was a research platform. The company’s core strength at that time was providing users with the ability to consolidate their portfolios into one app to monitor their investments.
However, Webull quickly became a trading service that offered zero-commission trades. This has already fundamentally changed the fee structure for many brokerage firms who now offer zero-commission trades as a part of their core offerings.
What Platforms Does Webull Offer?
Webull is available as both a desktop app and a mobile web-based app. Once a user establishes an account they have access to both versions. Consumers can choose one of three accounts.
- A cash account has no minimum deposit requirement
- A margin account that offers short selling and limited day trading
- A margin account that offers short selling and unlimited day trading
Traders are required to have at least $2,000 in their account to trade on margin. Provided their account is properly funded, traders can switch from a cash account to a margin account straight from the platform. A feature of margin accounts that many traders will appreciate is the ability to margin short sales with 4x leverage on trades made the same day and 2x the amount for trades held overnight.
However, there are margin rates for holding overnight leveraged positions. This fee structure is on a sliding scale that gets lower the larger your account balance.
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Dollar Range
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|
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$0 - $25,000
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6.99%
|
|
$25,000 - $100,000
|
6.49%
|
|
$100,000 - $250,000
|
5.99%
|
|
$250,000 - $500,000
|
5.49%
|
|
$500,000 - $1,000,000
|
4.99%
|
|
$1,000,000 - $3,000,000
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4.49%
|
|
>$3,000,000
|
3.99%
|
Traders can trade over 5,000 stocks and exchange-traded funds (ETFs) on the New York Stock Exchange (NYSE), the NASDAQ, and the AMEX for free and with no inactivity fees. A very nice feature of Webull is that traders can trade stocks and ETFs as part of an individual retirement account (IRA). Traders can choose a traditional IRA, Roth IRA or rollover IRA.
There are also no fees for an ACH bank transfer, but there is a fee for a wire transfer. Credit cards and debit cards cannot be used.
What Trading Analysis Tools Does Webull Offer?
Traders have access to both technical analysis and fundamental analysis tools. At this time, the fundamental analysis side of the app may feel somewhat limited for more advanced traders. Traders have access to analyst recommendations, historical data on revenue and earnings per share. You’ll also get information about insider trading activity, dividends and stock splits. Plus, you’ll get links to news feeds that allow you immediate access to breaking news about the stocks you’re trading or those on your watch list.
By contrast, the technical analysis tools may seem very robust for novice traders. Stock charts are displayed in an easy-to-use format with individual widgets that can be moved around a screen similar to how users set up a smartphone or tablet.
Users can display them in a real-time bar, candlestick, and line charts and select a time frame that ranges from 1 minute to 60 minutes. The charts display information that goes as far back as five years.
However, more experienced traders may find the tools to be a bit limiting. That’s because, for now, the platform only includes a limited number of technical indicators:
- Simple Moving Average
- Exponential Moving Average
- Bollinger Bands
- Keltner Channels
- Ichimoku Cloud
- SAR
- VWAP
- Volume
- MACD
- KDJ
What Other Research Tools Does Webull Offer?
Two additional features that Webull offers traders are a Stock Screener and a Paper Trading (Demo) mode. The stock screener offers traders a limited, but fairly sophisticated, range of technical filters. This lets traders screen for among other things: moving average convergence/divergence (MACD) golden crosses, bullish engulfing patterns, and white soldiers patterns.
The paper trading mode is a demo mode. This allows all traders to get familiar with the features of the app before they use it. And the app holds daily and weekly competitions complete with monetary prizes.
So there’s no confusion, although Webull’s standard platform is completely free. And unlike other standard packages, traders do get a wealth of information in the standard platform. However, the company does charge for premium data. Here are some of the packages with their current rates:
- Toronto Stock Exchange Level 1: $24.99/month
- Nasdaq Basic: $2.99/month
- National Best Bid and Offer: $9.99/month
- Taiwan Stock Exchange Level 1: $2.99/month
- Hong Kong Stock Exchange Level 2: $59.99/month
- London Stock Exchange Level 1: $16.99/month
- Deutsche Borse Level 1: $9.99/month
How Secure is Webull?
Of course one of the questions with any trading app is how secure are my assets. Webull is regulated by the Financial Industry Regulatory Authority (FINRA) and the Securities & Exchange Commission (SEC). In addition assets up to $500,000 (up to $250,000 for cash in your account) are protected by the Securities Investor Protection Corporation (SIPC).
Users of the mobile app receive an extra layer of security with two-step authorization process to log in.
Does Webull Offer Customer Support?
For an app that is rooted in technology, this is where Webull may be behind the curve a little bit. There is not much by way of user education on the app. So there is an assumption that you have some knowledge of stock charts and trading. The company does offer 24/7 telephone support. However, on the desktop there is no live chat feature. To get a hold of customer support requires you to send an email. So while there is customer support, it may not be as intuitive as users have come to expect.
Are There Limitations to Webull?
No trading app is going to be perfect. And like I’ve mentioned repeatedly Webull is not the choice for the full-time day traders who need direct market access for rapid trade execution. The speed of the trade offsets any benefit they might gain from the zero-commission structure. And Webull does not allow users to create the sophisticated keyboard macros that these traders depend on.
But for its core audience, there are a couple of limitations. First, at this time, Webull is only available to United States and Chinese citizens and Visa holders. At the time of this writing, the company is, looking to expand to Canada and Europe. So this may not be a limitation for much longer.
Another limitation for more experienced and risk-tolerant investors is that the app at this time only allows trading in the U.S. dollar. The app also supports a limited number of asset classes. At this time, there is no foreign exchange (forex) trading. Traders also cannot trade in the bond market, or in cryptocurrencies.
Also, risk-tolerant investors who are trading on margin must be aware that Webull does not offer negative balance protection at this time. This means investors can lose more than the amount of their investment.
The Bottom Line On Webull
Self-service, zero-commission trading apps are the wave of the future. Webull and Robinhood are two of the apps that are competing for the millennial investor. And although “Robinhood trades” have been criticized for speculating in risky penny stocks, apps like Webull are making the market accessible to a new generation of investors. Webull has the research tools and an easy-to-use interface that can help traders get started on their investing journey.
Webull does have some limitations, but those will mostly only be noticed by more experience investors. The company is also looking to expand its international presence. But overall, the pluses far outweigh the minuses. Investors should have little trouble navigating the app and with the paper trading mode, they can do a trial run before putting any capital at risk.
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