Webull Review: Is Webull Legit?

This post may contain affiliate links. Please read my disclosure for more info.

Since Robinhood debuted in 2013, the investing landscape has seen a major shift towards providing zero commission trading options. 

This has made it possible for your average person (myself included), to trade stocks and ETFs with little to know money up front. 

I can think of several trading platforms (Robinhood and Webull are two of them) that would allow me to open an account with no minimum deposit and start trading stocks or ETFs immediately. 

However, where Robinhood is geared more toward new, DIY investors, a newer app called Webull has filled the niche of providing the similar advantage to Robinhood, but with the added benefit of advanced tools and features for your more experienced traders.

My Personal Experience

I’ve personally used Webull for a few months for some stock trading outside of my Vanguard retirement account. 

Even as a novice investor, I find the wealth of information interesting and can see how they would be beneficial to someone trading in and out of the market fairly regularly. 

Although I don’t recommend it for your primary brokerage, I still think it has a lot of value-added. 

At the very least, everyone should sign up for the 2 free stocks (affiliate link) they’re currently promoting (one for signing up; the other for depositing $100).

What is Webull?

Webull was launched in 2018 and is an online stock brokerage that offers free trading on mobile, web and desktop platforms.

Webull is privately owned with funding provided by venture capital.  They currently have 10+ million users.

It’s free to open an account with a no deposit minimum to get started.  If you want to deposit $3.55 and invest in a $3.33 stock, you could do just that with no fuss.    

Webull seems to fit the niche for a legit free trading brokerage that also provides advanced features such as free real-time quotes, extended hours trading, and advanced tools and services you wouldn’t find at a competitor like Robinhood or M1 Finance.

Webull Review: A Quick Summary

• Eligibility:  All US states and territories
• Account Minimum:  there isn’t one!  If you want to use a Margin Account
• Commission Free Investing:  No commissions on trades
• Investment Products:  stocks, options, exchange traded funds (ETFs), and American depository receipts (ADRs) with cryptocurrencies coming soon.
• Account Types: 
  • Taxable Accounts:  individual and margin accounts
  • Tax-advantaged Accounts:  traditional, roth, and rollover individual retirement accounts (IRAs). 
• Full Extended Hours Trading: includes full pre-market (4 – 9:30 am ET) and after hours (4 – 8 pm ET) trading sessions.
• Free Access to Webull’s Desktop Trading Platform:  A customizable platform that allows you to stay current with the markets with watchlists and charts, and manage your investments by placing orders and checking your positions, no matter where you are.
• Advanced Tools and Resources:  charts, technical indicators, and other advanced real-time data options to help you analyze companies and trends.
• 24/7 Online Customer Service Support
• Access to Paper Trading & Paper Trading Competitions:  If you’re looking to practice before putting your hard-earned money on the line, Webull offers a platform with virtual money (fake money) to try out trading with no risk involved. 
• Platforms:  iOS, Android, Mac, Windows, and Web
• Webull is Safe:    Webull is a registered broker dealer with the SEC as well as a member of FINRA and the SIPC.  A Webull account is protected up to $500,000 ($250,000 cash).  In additional, their clearing firm, Apex Clearing Corp has additional insurance that provides protection for securities and cash up to $150 million total, with individual limits of $37.5 million for securities and $900,000 for cash. 
• Promotions: Currently offering an excellent sign-up bonus – two free stocks valued at up to $1,650. 
  • If you successfully open a Webull brokerage account, you’ll receive a free stock valued between $2.5 – $250
  • If you make an initial deposit of $100 or more within 30 days of signing up, you’ll receive a second free stock valued between $12 – $1,400

Who is Eligible for a Webull Account?

To open a brokerage account on Webull you’ll need to meet the following requirements:

1. Be 18 years or older
2. Have a valid SSN (Social Security Number)
3. Possess a legal residential address in the U.S. and outlying U.S. territories
4. Have a U.S. citizenship, U.S. permanent residency card, or a valid U.S. visa

How to Open a Webull Account?

To open a Webull account, click here (affiliate link).  In addition to the information above, you’ll need to link to a bank account based in the U.S. to make deposits and withdrawals into your Webull account.

Webull Account Options

Taxable Accounts

Webull provides access to both margin and cash account options. 

A cash account is your normal individual account where you invest cash that you’ve deposited. 

If you’re looking for an account where you have access to margin trading (essentially borrowing money from the broker to buy more stock) and short selling (borrowing a security and selling it on the open market, but planning to buy it back later for less), you’ll need a margin account. 

Webull has a great table that highlights the different features and at what account balance they are unlocked.

Tax-advantaged Accounts

In addition to taxed accounts, Webull also offers Individual Retirement Accounts (IRAs). 

Assuming you meet the minimum requirements (US citizen, receive taxable compensation, and under 70 ½), a traditional IRA allows you to invest your income immediately without first paying income tax.  Then it grows tax free until you start withdrawing the money in retirement at 59 ½.

Webull also offers rollovers (which is just transferring from one tax-advantaged brokerage account like another IRA or a 401k to the Webull IRA) and Roth IRAs. 

Roth IRAs are similar except you pay taxes upfront just like any other income.  The money that you invest grows tax free and when you are ready to withdraw for retirement, you don’t pay any taxes on it. 

Trading on Webull

What Kind of Securities Can I Trade on Webull?

Webull currently supports the trading of US-listed stocks and ETFS, IPOs, and ADRs. 

They don’t currently support over-the-counter (OTC) stocks, so if you have a stock get delisted or try to transfer an OTC stock to Webull you’re going to run into some difficulty. 

Webull allows you to buy penny stocks, but places the following restrictions on trading.

If the price is:

• less than $0.01 – not eligible for trading
• greater than or equal to $0.01, but less than $0.099 – must buy 1,000 or more
• greater than or equal to $0.1, but less than $0.999 – must buy 100 or more
• greater than or equal to $0.999 – no limits

Webull doesn’t currently support cryptocurrencies, but is actively working on adding this feature.

What Types of Orders Can I Place on Webull?

In the normal order screen, you can place the following order types:

• Limit Order
• Market Order
• Stop Order (Stop-Loss Order)
• Stop-Limit Order

Under the advanced order screen, you have the option to set bracket orders (stop-loss/take-profit orders). 

Essentially you can set limits for buying a security at a certain price, then set a corresponding top (take profit) and bottom (stop loss) selling price. 

What Data Can I Use for Free with Webull?

Webull provides access to worldwide financial data, including:

• 5 categories: Equities, ETFs, Indices, Forex, and Futures
• 100+ exchanges: including NASDAQ, NYSE, LSE, HKEX, SGX, NSE, BOM, etc.
• 100,000+ investment subjects

How Does Webull Make Money?

Webull makes money just like any other broker with the exception of commissions.  They make money from:

• Stock loans
• Interest on free credit balances
• Margin interest
• Payment for order flow

Webull Pricing and Fee Schedule

Although Webull provides free commission trades and no minimum deposit requirements, they still charge fees for various services they provide like margin accounts and short selling (fees any other broker who provides these services would charge). 

Margin Interest Rates

If you have at least $2,000 in a margin account, Webull offers up to 4x day-trade power and 2x overnight buying power.

Interest on margin trading is calculated on a daily basis and paid on a monthly basis. 

The annual margin rate is tiered based on the size of the margin loan. 

Please see below a breakdown of the annual margin rate by debit balance:

Short Selling Fees

Short sales require borrowing shares of a company.  There is a cost associated with borrowing those shares.  The cost changes daily and is based on market conditions

To calculate the short selling fees, Webull suggests using this formula:

Daily Margin Interest (Short Position) = The Daily Market Value of the Borrowed Stocks when the Market Closes*Stock Loan Rate for That Stock/360

Other Fees

In addition to these fees, there’s also the normal fees charged by regulatory agencies and exchanges (every broker gets charged these fees) as well as wire transfer fees, stock transfer fees, and postage fees. 

I’m not going to list them all here, but if you’re interested in Webull’s full fee schedule, you can find it here.

You won’t have to worry about any of these fees as long as you stick to trading in an individual account and transfer funds using your checking account (ACH transfer).

Webull Current Sign-Up Promotions

Get Free Stocks

• If you successfully open a Webull brokerage account, you’ll receive a free stock valued between $2.5 – $250
• If you make an initial deposit of $100 or more within 30 days of signing up, you’ll receive a second free stock valued between $12 – $1,400

To get your free stocks, sign up here (affiliate link).

Related: 3 Ways to Get Free Stocks from Legitimate Brokerage Firms

Webull Pros and Cons

Webull Pros

• No fee investing
• No account minimums
• Currently offering an excellent sign-up bonus – up to $1,650 in free stocks
• Advanced tools and resources not typically found in free trading apps
• Access to tax-advantaged accounts: traditional, Roth, and rollover IRAs
• Full extended hours trading
• Access to options trading
• Margin accounts with a value of $2,000 or more, can trade on margin or short sell with 4x day trade buying power and 2x overnight buying power.
• Has continued to approve and add new features (currently working on the ability to trade cryptocurrencies)

Webull Cons

• Fairly new app
• Doesn’t currently accommodate OTC stocks, mutual funds, bonds, futures, forex, or cryptocurrencies
• Doesn’t currently support fractional shares
• Webull accounts are not currently available to non-U.S. residents

How Does Webull Compare to Other Free Trading Apps Like Robinhood or M1 Finance?

When compared to apps like Robinhood and M1 Finance, Webull stands out in the following categories:

• No account minimums
  • M1 Finance currently requires a $100 account minimum
• Better sign up bonus – up to $1,650 in free stocks
  • M1 Finance currently offers $10 when you sign up and deposit $100
  • Robinhood currently offers a free stock for signing up – up to $200
• Advanced tools and resources for intermediate to advanced traders
• Access to a trading simulator
• Extended trading hours
• Additional insurance from their clearing firm, Apex Clearing Corp

Is Webull a Scam?

Webull is not a scam.  Webull is a registered broker dealer with the SEC as well as a member of FINRA and the SIPC.  A Webull account is protected up to $500,000 ($250,000 cash). 

In addition, their clearing firm, Apex Clearing Corp has additional insurance that provides protection for securities and cash up to $150 million total, with individual limits of $37.5 million for securities and $900,000 for cash. 

Is Webull Legit?

So, when everything is said and done, do I believe that Webull is a good place to invest your hard-earned money?  My answer is, it depends. 

Are you someone who:

• trades regularly and can benefit from the advanced features?
• wants the added protection of the additional insurance provided by Webull’s clearing firm, Apex Clearing Corp?
• just wants the awesome sign up bonus (up to $1,650 in free stocks) from their current promotion?

If you are, Webull has a distinct advantage over many other commission free trading apps and is probably right for you. 

If you are more interested in long-term investing in ETFs and index funds that either follow the market as a whole, or large sections of the stock market (i.e. energy, healthcare, REITs, etc.), then I would suggest a larger, more established company like Vanguard.

This is where I personally keep the majority of my retirement accounts as they provide zero commissions and very low fees on their ETFs and index funds.  Not to mention, they’re member-owned, so I know they have my best interests in mind (I have my best interest in mind?).  I’ve had an account with them for years now and can’t say enough good things about my experience. 

Where do you invest your money?