By: Bob Haegele
October 20, 2021Trading and investing can be complicated. Experienced traders know their way around a stock chart, but for the average buy-and-hold investor, it can all seem a bit foggy. Fortunately, SoFi stock trading keeps the experience simple.
All of these advanced metrics can be a blessing and a curse. Those who are looking to maximize returns or even trade for a living need to know everything about each stock, from earnings per share to Fibonacci retracements.
But if you just looking to buy and hold shares of your favorite stocks like Amazon or Apple, a basic platform such as SoFi may be a better fit. Here, we’ll take a look at SoFi’s platform and how stock trading works.
What is SoFi Stock Trading?
SoFi has two separate platforms for stock trading and investing called SoFi Active Investing and SoFi Automated Investing. We cover both in our SoFi Invest review. But since this post is focusing on trading, we’ll hone in a little more on SoFi’s Active Invest product.
To access your account, either login to your SoFi account on a desktop or laptop computer, or just open the SoFi app on your phone. Once you do, go to the Invest tab on either type of device.
If you are brand-new to SoFi, you will have to first create an account to hold your investments. In most cases, you will open either a taxable brokerage account or an IRA.
Once you have created your account, you will have to make a deposit if you want to start trading. To do so, click “Add cash” on either the website or the app. Then, you will have to link a bank account. SoFi uses Plaid authentication to add your bank.
You can also use your bank account and routing number, although that takes longer. Once your bank account is added, you can either deposit manually or set up recurring deposits.
Once your money is transferred in, that’s it. You are ready to start stock trading on SoFi.
SoFi Stock Trading Features
Although SoFi is a fairly basic stock trading platform, it does have some features to make things easier.
Stock Bits
Stock Bits are one of the nicest features of SoFi Invest, although several brokerages have this feature this days. Also known as fractional shares, Stock Bits let you purchase small pieces of a stock.
It is not uncommon for some stocks to have shares prices in the hundreds or even thousands of dollars. My favorite example of this is Berkshire Hathaway’s BRK-A, which has a share price over $425,000!
Clearly, the you won’t find the average investor (or most investors) buying whole shares of BRK-A. While this is an extreme example, Stock Bits let you trade with as little as $5, so you don’t have to worry about being priced out of a stock.
Recurring Purchases
Related to the above, perhaps you can only trade with small amounts of money at a time. Recurring purchases helps with this. You can buy the stock you want to buy weekly, every other week, or monthly. Just specify the day you want to buy the stock, and you’re all set.
Watchlist
SoFi Invest also has a basic watchlist. When viewing a stock, you have three buttons: buy, add a recurring purchase, and + watch. Click + watch to add it to your watchlist. Once you do, you will see it in your watchlist.
To find it, go back to the Invest homepage by clicking Invest in the top menu. In the mobile app, just hit back until Invest at the top of your screen. Whether on desktop or mobile, scroll down on the Invest tab and you will eventually see your watchlist.
There, you see some basic information: the stock name, ticker, the day chart, day change, and the market price.
Cryptocurrency Trading
SoFi also allows cryptocurrency trading. While you won’t find every single crypto here, it has all of the favorites. That means Bitcoin, Ethereum, Dogecoin, and plenty more. When you start trading cryptocurrency on SoFi, you get $10 in free Bitcoin.
Free Access to Financial Advisors
One of the nicest things about trading on SoFi is that you get free access to financial advisors. There’s no catch: they give you access to speak with a financial advisor through chat, email and phone.
Keep in mind that as a free service, though, it is naturally not as comprehensive as the attention you would get with a paid service. They won’t give you stock picks, or other specific advice. It’s mainly to help acclimate you with the platform.
SoFi Stock Trading Fees
There are no fees whatsoever to trade stocks on SoFi. Like other platforms, such as Robinhood, SoFi makes money via payment for order flow (PFOF). In other words, it sells aggregated data about clients’ orders. It also makes money on interest on customer deposits and charging those who trade on margin.
While PFOF can be controversial, it doesn’t cost you anything. Thus, SoFi trading is completely free as long as you aren’t paying interest on margin trades.
And thanks to Stock Bits, all you need to get started with SoFi trading is $5.
Is SoFi Stock Trading Right For You?
SoFi stock trading is a fairly basic platform that lets traders buy and sell stocks. It does have some additional features, such as recurring purchases, Stock Bits (fractional shares), and a basic watchlist. And thanks to stock bits, you only need $5 to start trading.
More advanced traders will likely find SoFi stock trading leaves a lot to be desired, however. Thus, the answer to this question depends upon your level of expertise and whether you need advanced stock data. Generally speaking, SoFi is not going to have the features needed by a day trader.
But if you are first starting out and just want a basic way to buy a few stocks, you may find SoFi stock trading works well enough for you. If you want to start creating your account on SoFi, head to the SoFi website and create your account.
