M1 Finance vs. Webull: Investing App Pros & Cons

M1 Finance and Webull are commission-free investing apps that serve different types of customers. M1 Finance targets investors who want to build portfolios and watch their money grow in the long run. Webull is better suited for day traders. Keep reading to learn more.

SustainFi   Updated January 20th, 2022

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At a glance

  • Both M1 Finance and Webull offer free trading in stocks, ETFs, and fractional shares. The best option depends on what type of investor you are
  • Best for long-term investors: M1 Finance. M1 Finance lets you easily create custom portfolios, buy fractional shares and borrow against your investment account. It’s easy to rebalance your portfolio to meet your investing goals. A one-stop-shop, M1 Finance also offers bank accounts and a stock rewards credit card
  • Best for day traders and crypto investors: Webull. Webull suits day traders and crypto investors. You can access a good selection of cryptos, get a margin loan, and buy fractional shares

Keep reading to learn more.

Minimum

 $100

Minimum

$0

Fees

$0 for stock and ETF trades

Fees

$0 for stock, option and ETF trades

Investments

6,000+ stocks, ETFs, fractional shares

80+ expert portfolios

Investments

5,000+ stocks, ETFs, options, fractional shares, cryptos

Margin loans

Yes (2.0%-3.50%)

Margin loans

Yes (3.99%-6.99%)

Account types

Individual and joint investment accounts; Traditional, Roth, SEP IRAs; custodial accounts; trusts

Account types

Individual investment accounts; Traditional and Roth IRAs

Cash management

Savings accounts with up to 1% APY

Cash management

Not offered

Automatic rebalancing

Yes

Automatic rebalancing

No

Socially responsible investing

Yes

Socially responsible investing

No

What is M1 Finance?

M1 Finance is an investment platform that combines an online broker and a robo-advisor. They offer an easy-to-use app that lets you build customizable portfolios (called “pies.”)

The pie portfolio model allows you to easily add a stock or an exchange-traded fund (ETF) as a piece of the pie. You choose what percentage to invest in each asset. If you don’t want to “bake” your own pies, M1 Finance comes with over 80 premade options. Besides, M1 Finance offers fractional shares and lets you borrow to invest.

Despite its flexibility, M1 Finance is a platform for investing, not for day trading. For example, you can only buy and sell during the daily trading window (two windows for eligible M1 Plus members.)

Brian Barnes started Chicago-based M1 Finance in 2015. His startup has recently surpassed $4.5 billion in assets under management, raising over $300 million from investors like Softbank.

🔔 Read the full review of M1 Finance.

What is Webull?

Founded in 2017 and launched in 2018, New York City-based Webull is a broker that lets you trade more than 5,000 stocks and ETFs, as well as fractional shares, options, and cryptos. And you can get a margin loan with a 3.99%-6.99% rate. Trades are commission-free and there is no account minimum.

The investing app also offers advanced charting and analytics capabilities. You can trade on the sleek mobile app or customize the desktop interface as you see fit. To sum up, Webull is like Robinhood built for more advanced investors.

However, Webull doesn’t support investing in mutual funds, bonds, futures, or forex. For stocks, you can’t use the platform to buy over-the-counter (OTC) stocks, most penny stocks, or stocks listed on exchanges outside the U.S.

Because Webull targets self-directed investors who know what they are doing, investor education resources and research options are also pretty limited.

🔔 Read the full review of Webull.

M1 Finance vs. Webull: Account types

Both M1 Finance and Webull support:

  • Individual taxable investment accounts
  • Retirement accounts, including traditional, Roth, and rollover IRAs

However, M1 Finance also supports:

  • Joint investment accounts
  • SEP IRAs
  • Trusts
  • Custodial (UTMA/UGMA) accounts for kids (available to M1 Plus members only)

💰 The winner: M1 Finance.

M1 Finance vs. Webull: Minimum investment

M1 Finance asks you to deposit $100 into your account to start building pies. The minimum goes up to $500 for IRAs and $5,000 for trusts.

Webull has no minimum.

💰 The winner: Webull.

M1 Finance vs. Webull: Commissions and fees

Both M1 Finance and Webull offer free trading in stocks and ETFs.

Although M1 Finance lets you build portfolios, they don’t charge a management fee. M1 Finance makes money on lines of credit and optional extras like Plus memberships. However, accounts with less than $20 and no trading activity for over 90 days are charged a $20 maintenance fee.

M1 Finance Plus memberships cost $125 per year and offer access to perks like an extra trading window and discounted borrow rates. Plus accounts also let you set up Smart Transfers, a service that sweeps excess cash into your investing account. As a Plus member, you also earn interest and get cash back on your M1 Spend account.

Webull will charge you for advanced market data from Nasdaq, which is an optional subscription.

Webull makes money on payment for order flow (i.e., selling your trading data to market makers for execution), interest on your uninvested cash, and margin loans.

💰 The winner: Tie.

M1 Finance vs. Webull: User interface

M1 Finance offers an intuitive user interface that helps you visualize your investment as “pies.” However, the platform doesn’t offer research tools, so you will have to research your investments elsewhere.

Build for active traders, Webull has a more complicated interface, which includes charts, stock screeners, technical indicators, paper trading capabilities, and advanced real-time market data. Here is what it looks like:

However, you will need to pay for Level 2 market data (Nasdaq TotalView), which gives more detailed bid and offer data. Level 2 data is currently offered for free to new users for the first three months. After that, Level 2 data costs $1.99/month.

💰 The winner: It depends. M1 Finance interface is best-suited for long-term, more passive investors who want to visualize their portfolio. Webull is best for short-term traders. Because M1 Finance doesn’t offer as much data, it’s easier to use.

M1 Finance vs. Webull: Available investments

M1 Finance lets you add over 6,000 individual stocks, ETFs, and fractional shares to your pies. (Fractional shares allow you to buy a piece of a share if buying the entire thing is more than you would like to spend.) In addition, you can pick from over 80 expert portfolios.

Webull lets you trade over 5,000 stocks and ETFs, including fractional shares. It also supports options and over 20 cryptos including Bitcoin, Ethereum, Cardano, Dogecoin, and Shiba Inu.

💰 The winner: Webull. Although Webull doesn’t offer expert portfolios like M1 Finance, they support options and cryptos in addition to stocks, ETFs, and fractional shares.

M1 Finance vs. Webull: Margin loans

Margin loans let you borrow against your investments. You can use margin to increase your trading power.

M1 Finance gives margin loans to customers with over $5,000 in their investment account. The platform charges 3.5% interest (2% for M1 Plus members), and you can borrow up to 35% of the value of your account. Learn more about M1 Borrow.

To be eligible for a margin loan from Webull, you need to have at least $2,000 in your account. Interest on your loan is calculated daily and is payable monthly. How much you pay depends on the size of the loan. Here are the current rates:

Margin loanAnnual margin rate
<$25,0006.99%
$25,000-$99,9996.49%
$100,000-$249,9995.99%
$250,000-$499,9995.49%
$500,000-$999,999 4.99%
$1 – $3 million4.49%
> $3 million3.99%

💰 The winner: M1 Finance. The rates are much more attractive, even if you are not an M1 Plus member.

M1 Finance vs. Webull: Robo-advisor

M1 Finance lets you build custom portfolios (or use an expert pie) and rebalance them. Rebalancing means that the robo-advisor will buy or sell investments to get to your optimal asset allocation, like 80% stocks and 20% bonds. Sometimes when one asset class, like stocks, does much better than another one, like bonds, your portfolio may “drift” and become riskier (or less risky) than it should be. Rebalancing solves that.

Webull doesn’t offer any portfolios or rebalancing options.

💰 The winner: M1 Finance.

M1 Finance vs. Webull: Trading hours

Built for long-term investors, M1 Finance offers 1-2 daily trading windows. M1 Finance has trading windows to lower trading costs and keep trading free.

The morning window begins at 9.30 AM, and the afternoon trading window begins at 3 PM. The morning window is available to all M1 Finance customers, while the afternoon window is only for M1 Plus members. To participate in both windows, M1 Plus members must have $25,000 or more in equity per account.

Built for active traders, Webull doesn’t have trading windows. The app supports full extended hours trading, which includes pre-market (4 AM – 9:30 AM EST) and after hours (4 PM – 8 PM EST) windows, meaning that you can place orders any time between 4 AM and 8 PM.

💰 The winner: Webull.

M1 Finance vs. Webull: Cash management and banking

Webull doesn’t have any cash management products. So any uninvested cash will just sit in your account, and Webull will earn interest on it (which is one of the ways they get paid and not charge you commissions on trades.)

In contrast, M1 Finance has M1 Spend, a free savings account that comes with a Visa debit card. M1 Plus members get 1% APY on their money and 1% cash back on qualifying purchases. The account is FDIC-insured for up to $250,000. M1 Plus members get reimbursed for up to four ATM transactions each month. Learn more about M1 Spend.

💰 The winner: M1 Finance.

M1 Finance vs. Webull: Human financial advisors

Neither Webull nor M1 Finance offers human financial advisors.

💰 The winner: None. If you are looking for human advisors, you can get complimentary advisor access from SoFi.

M1 Finance vs. Webull: Socially responsible investing

Webull doesn’t have any sustainable investing options, but M1 Finance comes with two premade Responsible Investing Pies, though you can design your own. One Responsible Investing Pie invests in U.S. stocks, and the other one in global stocks. We have also created a very cheap fossil-free ESG investing pie. Read the full review of M1 Responsible Investing Pies.

💰 The winner: M1 Finance.

💰 The Overall Winner

  • Best for long-term, passive investors: M1 Finance. M1 Finance lets you build custom portfolios or pick from a selection of over 80 expert pies and rebalance them. It offers more account types than Webull, lets you earn interest on uninvested cash and get a margin loan at very attractive rates.
  • Best for day traders: Webull. Webull is a better option for day traders and investors who want to trade crypto and options. Webull’s interface is better if you trade actively, too. However, Webull charges higher rates on margin loans, supports fewer account types, and won’t let you earn interest on uninvested cash or rebalance your portfolio.

🔔 Want to compare more options? Check out the top 10 investing apps.

Compare:

NOT INVESTMENT ADVICE. The content is for informational purposes only; you should not construe any such information as investment advice.

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