Another week another outage for the Robinhood app. At this point can you as an investor continue to trust them?
Every app and every program is susceptible to failures. There truly isn’t a 100% reliability as there are just other factors that can lead to an app or program failing. Factors such as server issues whether on your end or on the end of the developer.
Then you have to take into account other factors such as failures of the device you’re using, issues with the market itself (ie the glitch that caused a delay in the market opening on Monday morning). So when you take all that into account I do not think you can judge the worthiness of an app or program based on one failure.
But what I will judge an app or program on is what they do in those failures. Are they transparent?
Do they have an idea what happened?
Do they have a plan in place?
Do they have a backup plan in place?
And do they have a solution to try and make sure that never happens again?
These answers help provide confidence in the developers that they have things under control. Because with an app like Robinhood, where we are pouring our hard-earned dollars in to invest, we want there to be a sense of control. And when that control is not there it leaves us feeling uneasy. And this is what I personally am feeling about with Robinhood.
If after the first outage they came out with a definitive response to what happened and a plan that was put in place to prevent it in the future, I could’ve probably forgiven them. But their delay to respond, and then when they did respond followed it with a statement along the lines that this could happen again, left me feeling like there was no sense of control. And this uneasiness sent me to TD Ameritrade.
Thankfully I made that choice because surely as water is wet, Monday was met with yet another Robinhood outage. But unlike my fellow Robinhood users, I had already moved my money to TD Ameritrade and was able to go about trading and making moves without issue.
So to the question of should you trust Robinhood, I will say that for me I prefer the Robinhood app for keeping up with financial news, as well as seeing the trajectory of my watched stocks. But as far as me using it to invest my money in, naw… y’all can have that. Where others were on Twitter talking about “strike 3”, I had already moved money after strike 1. And I wasn’t sticking around for a strike 2.
If you decide to keep Robinhood they have a status page to see what is up and what is experiencing any interruptions.
From their site.