How Webull Makes Money

I keep seeing WeBull 2 stocks free promotion and wonder how do they make money?

Some people ask, “Is Webull safe?” Most importantly, we want to know how Webull makes money? Like other zero-commission brokerages, WeBull makes money via paid subscriptions, margin trading, interests, and order flow.

Is Webull Safe and Selling My Data?

Before going into details of how Webull makes money, let’s answer this question. A short answer to this question is, yes, Webull is 100% safe. They are SIPC secured, and if you visit their website or while registering, you will come to know by reading their terms and conditions that they don’t sell your financial data. 

How Does Webull and Other Investing Apps Make Money?

Webull and other apps make money in a less conventional way. They know that there are other ways to make money instead of charging commissions and fees on trades. Webull is a promising and exciting commission-free trading app, and it was launched in May 2018. 

Lots of other stock investing apps are available, and most of them are free. Webull saw the weaknesses of other platforms, and they build a perfect app for traders with all the necessary features. Webull and other investing apps make money in different ways, and they don’t charge commissions and fees from customers. 

  • They earn interest in cash that is held within a brokerage account, or it isn’t invested. 
  • They get fractions of a penny per share when they direct order flow. 
  • You may found paid subscriptions of Webull. These paid subscriptions are for global market data. 
  • They earn from margin interests. They share loans to short sellers and make money. 
  • You may see some miscellaneous fees, such as transfer fees. 
  • When all these costs add up, they allow Webull to run a good business. 

So, these are the different ways that Webull makes money without charging commissions and fees on trades. 

How Does Webull Make Money?

We have briefly described the different ways in which Webull makes money. Now we will look at all these methods in detail. 

  • Paid Subscription
  • It is one of the ways of making money. They offer paid subscriptions to committed investors. You don’t have access to advanced trading features when you are using the free version. If you have a paid subscription, you can enjoy advanced trading features. I never said that you couldn’t trade with a free version, but if you have paid subscription, you can enjoy a wide range of investment strategies. 

    Surprisingly, intermediate and advanced traders use this app instead of beginners, and Webull targets them. When you have a paid subscription, you have access to international market data. Moreover, subscription charges are $4.99 per month and $53.99 per year. For a beginner, getting a paid subscription isn’t necessary, but it is a good choice for serious traders. So, this is how Webull makes money. 

  • Order Flow
  • It is another way in which Webull makes money. On the back end, they make money by selling order flow securities. In other words, when other firms have too many orders, they pay Webull to process them. In this way, brokerages can make extra money. 

  • Margin Trading
  • It allows you to trade on margins, and many active traders find it an exciting feature. If you are an active trader and trade several times per day, it will allow you to place trades without waiting for financial transfers.  However, we wouldn’t recommend such trades because it is riskier than other trade types. Webull makes money by charging margin fees. 

    If you want to trade on margin, you need to have a minimum account balance of $2000, and margin fees of Webull start at 3.99%. With Webull, you can sell on margin only two times during the overnight and four times per day. So, be careful while using this feature. So, in this way, Webull makes money. 

  • Interests 
  • When some cash is sitting idle in the customer’s account or not invested, then Webull invests it in money market accounts. On an individual basis, the amount is small, but when it is multiplied with thousands of accounts, it becomes a substantial source of income for Webull. You don’t have to worry about this practice because most brokerages follow this practice. SIPC protects your cash that is held in your accounts. So, Webull makes money in this way as well.   

    Pros and Cons of Webull

    Webull is a commission-free app for stock, options, and ETF. The account opening process of Webull is fast, digital, and seamless. Moreover, the platform is user friendly, well-structured, and offer many order types. The issue is the portfolio of Webull is limited, and it only covers US stocks, options, and ETFs. Moreover, you can’t use credit or debit cards for withdrawal, and you can only use bank transfer for withdrawal and deposit. Let’s look at the summary of the pros and cons of Webull. 

    Pros of Webull

    • You can enjoy fast, seamless, and digital account opening. 
    • Excellent trading platforms. 
    • You can enjoy commission free stocks, EFTs, and options. 

    Cons of Webull

    • The product portfolio is limited. 
    • App offers poor telephone support and no option of live chat. 
    • You can’t use electric wallets or debit cards for money transfer. 

    Conclusion 

    People get confused when this question “how Webull make money comes in their mind.” Webull and other investing apps are free and don’t charge commissions. There are still lots of ways in which Webull makes money, such as paid subscriptions, margin trading, interests, and order flow.

    So, when all these things add up, it becomes a substantial amount. Moreover, it is 100% safe and legal to use Webull. 

    Today, investors have unlimited investing apps, and more importantly, most of these apps are free. In the past, traders pay commissions while placing trades in EFT and stocks.

    Traders almost pay $7 to $10 on each trade. Nowadays, trading has become much easier for traders. Now, brokerages are offering $0 in commissions and fees.

      

    Author
    Sky Hoon. Read Full Bio
    Website Owner, Twitter-er
    He has been trading since 2008. He started this blog to share the journey about option trading. He dabbled in stocks, bitcoin, ethereum (in Celsius Network), ETF (lazy Dollar Cost Averaging) and also built websites for fun. He used this as a platform to share my experiences and mistakes in trading, especially options which I just picked up.

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