Value Investing

Webull Review: Zero-Commission Trading App

For the Enterprising Investor

Are you the investor that loves to inspect every individual data point in a stock? Are you an active trader? Let me introduce you to Webull. You’ve likely heard of other zero-commission brokerages like Webull, as they are rapidly growing in reputation; and for good reason! I’ve prepared a comprehensive review of Webull’s trading platform to let you know if it’s the best fit for you. Be sure to read until the end, Webull is offering VVI readers a free stock!

What Is Webull?

Zero-Commission Stock Trading App

Webull is a free zero-commission stock trading app. If you prefer working on your desktop, then never fear. Webull is operating a beta program of their software that you can download to your desktop to buy, sell, and trade securities just the same as you can in the app.

Are They Legit?

I can understand anyone’s apprehension of these newer zero-commission trading platforms. It’s common knowledge in the world of investing that there’s no such thing as a free lunch; so how does Webull operate for free?

First off, Webull is registered with the SEC, a member of FINRA, and the SIPC. In other words, they are certified with the same agencies as your other big-name firms.

As extra insurance beyond the typical SIPC insurance (which protects investors up to $500,000, and $250,000 in cash), Webull is additionally insured by a third-party agency, which covers up to $150 million! You can sleep soundly at night knowing that Webull is registered, protected, and insured exactly like other major brokerages on the market.

How Do They Make Money?

Excellent question! Just like every other brokerage, Webull makes money in commissions! But wait, I thought they were zero-commission? You’re still correct! They do not charge commissions on your buying, selling and trading of securities, but they gain revenue from other sources, such as the payment order flow, stock free loans, free credit balance, and margin interest. The value of Webull (and other zero-commission brokers) is that they pass those trading commissions savings on to the investor, so you can enjoy more of your profits.

Now that you know how they operate, let’s get into the app!

Design / User Interface

Webull’s display and user interface are sleek and nuanced. It’s well designed and relatively easy to navigate.

Eye in the Sky

You can conveniently manage which stocks you want to monitor by placing them on your watch list, which displays current market prices. Move to the markets tab, and there you can track not only the US markets, but many of the international markets including China, Canada, India, and Germany, to mention a few. Furthermore, they have a news tab that provides you the news highlights of the day and updates on the specific stocks on your watch list. You can also set price alerts to the stocks on your watchlist to automatically inform you when a stock has hit your buy or sell threshold.

One slick feature I enjoy is the global market map. This feature allows you to view the worldwide markets on a map and have a bird’s-eye view of the entire picture.

Portfolio

On the portfolio tab, you can observe your positions and how they are performing. You can even view how your entire account is growing vs. your individual stocks to determine the winner and losers. You can effortlessly buy, sell, and trade more of your favorite stocks from this section with just a few taps.

Fundamental and Technical Data

As mentioned before, Webull offers an impressive volume of material for the detail-oriented investors that prefer to use technical analysis. The investor will have no shortage of information about their portfolio. There’s an abundance of information to grasp here, let’s dive in!

Quote

Let’s look at Apple’s (AAPL) performance over the last year as an example. Right away on the graph, we can look at swathes of information including performance, moving averages, dividend dates, and earnings reports. If we keep browsing, we can see data charts with information on inflows, outflows, support, and resistance.

Financials

But that’s far from everything. If you select the financials tab, this is where the real fun begins. Here you can pour over the company’s released financial data, such as EPS, Revenue, EBITA, cash flow, balance sheet, and income statement. This data is especially handy to have in one location.

News, Press Releases, and Analysis

We’re not done yet. Carry on and you’ll find their press releases, such as their earnings calls. You can view their financial data like their 10-Qs, 10-Ks, and insider data. Head on over to the analysis tab, and you can see the analyst’s sentiment on their buy, hold, or sell recommendations. Lastly, you can view the AAPL’s weightings in the major ETFs that hold the stock.

Features

Real-Time Market Data

Webull delivers real-time market data that is constantly updating to yield the investor the most up-to-date quotes – and it shows. Market prices to update nearly as fast as you can blink. This function can be useful for investors who need to make quick decisions on a stock.

Extended Trading Hours

If you’re the investor who likes to wait until after markets close to do your trading, (or live in a faraway land) the after-hours trading offer is available for those who use that strategy. This can be especially useful if you get antsy watching the tickers all day (which I don’t recommend!).

Stock Comparison / Dual Charts

This is perhaps my favorite feature that Webull offers. Let’s go back to AAPL again. Say you wanted to compare its stock against one of its largest competitors: Microsoft (MSFT).  You can easily track each stock’s performance against each other on the same chart. Or, to take it a step further, you could even add the SPY (S&P 500 ETF) to track how both stocks behave in correlation to the market overall.

If you don’t enjoy comparing on the same chart because it looks too cluttered, fret not! You can still bring up two separate charts of the stocks on the same screen, which presents a side-by-side view.

Quick note: The app only compares 3 stocks/ETFs to at one time, while the desktop version allows for more.

Margin Trading

While VVI rarely recommends margin trading, it’s an opportunity for experienced and skilled investors. You can learn more about Webull’s margin trading policy here.

Stock Screener

Stock Screeners seem to be a dime a dozen these days; but, Webull offers one directly in the app. You can sort and filter by region, exchange, and sector. You can go even farther to add a screen for stocks with the EPS, P/E, and dividends that you like to see in a company. While it’s not the most detailed screener, it is a nice addition to the platform.

Paper Trading

If you are a newcomer to the world active trading, then it can be daunting. Webull offers a free paper trading program within the platform so you can garner experience in the trading arena without having to front your real cash. This is a feature I highly recommend beginners take advantage of. With the paper trading method, you can truly decide if this style of investing is right for you and at no cost to your wallet.

24/7 Support

Last, but not least, Webull offers 24/7 support for all your questions. If you are having an issue with the app/program, you can message contact them directly with their chat function (with an actual human, not bots) or get in touch with them via email.

Limitations

While Webull is admittedly a great service, they have certain drawbacks that investors need to acknowledge.

Overwhelming for Beginners

If you haven’t figured it out by this point, I’ll be explicit. Webull is tailormade for the more experienced investor and active trader. If you are new to active trading, or if you’re a buy and hold investor, I’d recommend other platforms, as Webull may be too excessive for you.

Investable Assets (or lack thereof)

If you are a regular VVI reader, this won’t be much of an issue for you. As value investors, we stick with investments we know and understand, and limit our speculation. Therefore, we seldom recommend investments such as futures, cryptocurrencies, and options, and forex. Webull currently does not offer these assets as investments. For now, you must invest with good old-fashioned stock, bonds, and ETFs. Don’t worry, you can do great with these!

No Retirement Accounts (Only Taxable)

Webull only offers taxable accounts for investors, as they target more active traders. This can be a slight nuisance if you like to keep your investments in one place, but not a detriment if you own a retirement account elsewhere. Plus, I wouldn’t recommend trading in your retirement account anyhow!

Is Webull For You?

The Enterprising Investor

If you fall into the enterprising or aggressive investor category, then Webull is a great trading platform for you. Webull is best for the skilled investor that prefers an actively managed portfolio. I would likewise recommend it for the beginner active trader that wants to try their hand at the game. The paper trading feature is a great function that you can use completely for free.

The Defensive Investor

If you are a defensive or passive investor, then I can say that Webull is likely not for you. The platform’s demanding features don’t lend themselves well to the novice and/or buy and hold investors, as there are too many distracting features that could hinder the overall experience. That’s not to say Webull can’t be used for those purposes; there are better platforms for those types of investors.

Want a Free Stock (or two)?

If you are interested in trying Webull, good news! VVI readers can sign up using my referral link below and get a free stock! It’s free to join and make an account, no matter if you fund it or not. Webull has a promotion right now until 9 August 2019 where new Webull users can receive a free stock valued at $2.50 – $250 if you finish the account opening process within the first 24 hours. Additionally, if you fund your account up to $100, Webull will credit your account with a free stock valued from $8 – $1,000! That’s two free stocks! You can click right here, or the image below to get started!

If you are a day trader, (or want to become one) having a margin of safety is critical. Find out how Warren Buffett uses a margin of safety in all of his investments to become the most successful investor of all time.

Read more great articles at Vintage Value Investing.


Source: Vintage Value Investing

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