Robinhood Trading App Rolls Out “Dollar Cost Averaging” for Crypto Investments
Robinhood is rolling out a new crypto feature that will allow users to automatically invest in supported cryptocurrencies on a daily, weekly, or monthly basis without a commission fee.
This “dollar-cost averaging” invests the same amount regularly instead of putting in the money in a lump sum, not worrying about market movement. However, it just steadily builds your crypto portfolio by buying the crypto and does not involve selling for you.
According to Robinhood, investing on a recurring basis helps one focus on the long-term and reduce the risk and stress of timing the markets.
“Dollar cost averaging encourages investing money gradually at regular intervals, rather than all at once and regardless of where market prices stand, in order to help smooth out the price swings that can sometimes occur,” it added.
According to Robinhood’s most recent earnings, the firm's transaction-based revenue from cryptocurrency trading increased 42x in Q2 of 2021 from Q2 of 2020.
Recently, the trading app went public on Nasdaq under the ticker HOOD and is currently trading at $40.05, down from an $85 high hit in the first week of its debut.