M1 Finance vs Robinhood 2026: Automated Investing vs Active Trading
Two very different approaches to commission-free investing. M1 automates portfolio building with fractional shares and smart rebalancing. Robinhood is built for active traders who want simplicity. Your investing style determines the winner.
M1 is the best platform for systematic, automated long-term investing. If you want to build wealth through regular contributions with zero effort after setup, nothing matches M1's Pie system. Not for active traders.
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Robinhood is the right starting point for new investors — nothing else is as easy to use. But active traders will quickly outgrow its limited tools. Think of it as the gateway drug: start here, graduate to Tastytrade or Webull.
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| Feature | M1 Finance | Robinhood |
|---|---|---|
| Our Rating | 4.3 | 4.1 |
| Commissions | Free | Free |
| Min. Deposit | $100 | $0 |
| Options Trading | — | — |
| Free to Close Options | ❌ No | ❌ No |
| Paper Trading | — | — |
| Account Types | Individual, IRA, Roth IRA | Individual, IRA, Roth IRA |
| Regulated | FINRA / SIPC | FINRA / SIPC |
M1 Finance — Full Review
M1 Finance's Pie-based investing model is genuinely innovative. You define target allocations (e.g., 40% VTI, 30% VXUS, 30% BND), and every deposit automatically buys fractional shares to maintain those percentages. Automatic rebalancing sells overweight slices and buys underweight ones with new deposits. The Expert Pies library offers pre-built portfolios by risk tolerance, strategy (dividend growth, factor investing, ESG), and time horizon. M1 Borrow lets you borrow against your portfolio at 5-5.5% — significantly cheaper than margin at most brokers — useful for large purchases without liquidating investments. The single daily trading window is actually a feature for long-term investors who don't want to be tempted into market timing.
Robinhood — Full Review
Robinhood's 2013 launch fundamentally changed the brokerage industry — within 18 months of launch, every major broker had dropped commissions to zero. Today Robinhood has expanded significantly: Robinhood Gold offers 4.9% APY on uninvested cash (one of the highest rates available), retirement accounts (IRA and Roth IRA), and extended trading hours. The 24-Hour Market feature offers trading on 900+ stocks around the clock on weekdays. Cash Card provides a debit card linked to your brokerage account with round-up investing. Despite the 2021 GameStop trading restrictions that damaged the brand, Robinhood remains the most widely-used trading app among Americans under 40.
The Verdict: Which Should You Choose?
Choose M1 Finance if you want to set a target portfolio and let automation handle rebalancing, contributions, and reinvestment — ideal for passive long-term investors.
Start Investing on M1 →Choose Robinhood if you prefer to actively pick individual stocks, want crypto alongside equities, and value the simplest possible mobile trading experience.
Get Free Stock on Robinhood →