Moomoo Review [2024]: Free Trading for Stocks, ETFs, and Options

INVESTING - BROKERAGES & ADVISORS
Our Moomoo review takes a deep dive into this commission-free trading app to help you decide whether it’s the one for you.
Updated April 11, 2024
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In the past, investing was seen as a costly endeavor. These days, though, there are a number of investment apps that allow you to put your money to work, starting from a small amount of cash and without the need to pay fees.

One of the investment apps available today is Moomoo, which is commission-free and offers plenty of trading options. If you’re in the market for a way to trade stocks, ETFs, or options without paying any commissions, you may have arrived at the right place.

Read our Moomoo review so you can decide whether this commission-free trading app is what you’re looking for to fulfill your investment needs.

In this Moomoo review

What is Moomoo?

Moomoo is based in Palo Alto, California, and is wholly owned by Futu Holdings Ltd. and its subsidiaries. Futu refers to Moomoo as its international platform for several stock markets. Futu Holdings Ltd. is backed by capital from well-known venture investors such as Matrix Partners, Tencent, and Sequoia Capital.

Futu Holdings Ltd. claims to offer a fully digitized investment and wealth management platform through Moomoo. The app offers access to real-time financial news and information, as well as advanced trading tools that allow investors to use a variety of strategies to invest.

Futu Inc. is a subsidiary of Futu Holdings Ltd. that acts as Moomoo’s broker-dealer within the U.S. It’s registered with the U.S. Securities and Exchange Commission (SEC). It is also a member of the Financial Industry Regulatory Authority (FINRA). Adding more legitimacy to the company is the fact that it’s insured through the Securities Investor Protection Corporation (SIPC).

Even though Moomoo is based in the U.S., its parent company, Futu Holdings Ltd., has locations in Hong Kong, Singapore, and Shenzhen, China. The company is listed on the Nasdaq exchange under the ticker symbol FUTU.

How does Moomoo work?

Explaining how Moomoo works is an essential part of our Moomoo review. This mobile trading app is available on Apple’s iPhone and Android phones. It offers access to a variety of investment channels. In addition to buying and selling traditional U.S. stocks and Hong Kong stocks, you can access:

  • Exchange-traded funds (ETFs): These are collections of assets. Rather than buying shares of a single company, when you invest in an ETF, you get exposure to many companies at once. ETFs offer exposure to stocks, bonds, or commodities and they trade like traditional stocks on the exchange.
  • Options: These are a type of contract that allows you to buy or sell an underlying asset, such as a stock, at a set price. You can choose to exercise the option or let it expire without making a move. It’s also possible to buy and sell the actual contract, which is known as options trading.
  • American depository receipts (ADRs): With an ADR, you can get access to foreign equities without dealing with foreign stock markets. It basically lets you gain exposure to a foreign company through a U.S. bank that holds its stock.

With Moomoo, you can choose to buy and sell ETFs, options, and ADRs using the mobile app. However, Moomoo doesn’t give you the ability to trade crypto or forex, but you can still view data and quotes from these markets.

The trading platform is fairly straightforward and can be used by beginners as well as advanced traders. There are no commissions on trades you make, though you might have other small fees, such as regulatory fees, that you’d pay when you sell. Additionally, although there’s no commission fee for trading options, you will pay a contract fee for each options contract.

In addition to allowing you access to trading, Moomoo offers several technical indicators and tools designed to help you make better investing decisions. You can get real-time quotes and news, as well as insights and analyses. This includes access to the New York Stock Exchange Arcabook, which offers real-time bids and asks, and is a tool often used by professional traders.

Other features that Moomoo offers include:

  • Extended hours trading: There are trading sessions pre-market opening and after market closure. Accessing these extended trading sessions allows you to position yourself with appropriate actions, even though the market is closed.
  • Execution price comparison: Moomoo looks at order prices across various exchanges to help you get the best price before you complete the trade.
  • High-volume trading: For those who trade frequently, the Moomoo trading platform is designed to handle higher trade volume.
  • Options analysis: You can test out strategies ahead of time and get potential profit-and-loss outcomes with help from Moomoo’s options analysis tool, which offers detailed market data.
  • Investment community: You can share your strategies and insights and similar information from other investors using Moomoo. Futu claims that it has 15 million active traders in its worldwide community, which you can join through the Moomoo app.
  • Paper trading: Practice investing without risking your own money. With paper trading, you can practice different strategies and see how they play out. However, you won’t make any real money until you make a deposit and perform a real trade.

Moomoo also includes a blog where you can get updated news and information, as well as investing ideas. As you learn how to invest money, these tools can prove to be quite valuable.

How much can you earn with Moomoo?

The Moomoo platform offers access to the stock market, where you have the potential to earn money — or lose money. It’s important to note that any investment comes with the risk of loss. However, over time, the stock market tends to grow. Historically, the S&P 500 index offers annualized returns of about 10%. If you used Moomoo to invest in an ETF based on the S&P 500, you could potentially see those types of returns.

It’s important to note, though, that these types of returns aren’t always constant. There are usually short-term ups and downs. Stocks could lose value one year and may recover the following year. But overall, historical returns do not guarantee future earnings.

Moomoo does have SIPC coverage through Futu Holdings Ltd., so your money is protected if the company goes out of business, up to $500,000. However, you should realize what SIPC insurance doesn’t cover. For example, it doesn’t protect against market losses, so if there’s a market event, your losses won’t be covered. This insurance only protects your account balance if Moomoo or Futu Holdings Ltd. goes out of business.

Who can earn money with Moomoo?

As long as you’re of legal age in your state, you can open an account with Moomoo. As a result, you usually need to be at least 18. You also need a valid Social Security number and a U.S. address.

There is no minimum deposit requirement to open an account, but you might need to make a minimum deposit to qualify for the free stock promotion.

How to open an account with Moomoo

Opening a Moomoo account is fairly straightforward. You start by providing your email address and creating a password. You can also choose to start the process via SMS and have a text link sent to your phone. Once that’s done, you will need to provide:

  • Your name
  • Your date of birth
  • Your Social Security number
  • Your U.S. Address
  • Your phone number
  • Your country of citizenship

As with other investing apps, you’ll also be asked to answer questions about your employment and income situation. Once your account is approved and active, you can learn how to use the tools, buy stock, and even claim a free stock if you’re eligible.

FAQs about Moomoo

Is Moomoo legit?

Yes, Moomoo is a legitimate trading app. It is wholly owned by Futu Holdings Ltd., which is a public company that is traded on the Nasdaq. Moomoo is registered with the SEC and is a member of FINRA.

Is Moomoo better than Webull?

Moomoo and Webull are similar, in that they offer the ability to invest in stocks, options, ETFs, and ADRs. However, Webull offers exposure to cryptocurrencies as well. Which one you use depends on your goals and the types of assets you want to invest in.

Moomoo offers more in-depth analysis and research tools than Webull, so if you’re looking for more advanced tools to start trading, you might have more luck with Moomoo, especially if you want to make use of the analyses and insights it offers.

For most investors, though, one isn’t really better than the other. Both offer commission-free trades and access to the stock market. For more info, check out our Webull review.

What are the fees for Moomoo?

Moomoo doesn’t charge commissions for its trades. However, there are some fees you might end up paying. They are based on the regulatory fee structure from the SEC and other authorities. These fees only apply when you sell, however. For example, when you sell a stock or an ETF, you might pay the following fees:

  • SEC fee: 0.0000051 x the transaction amount for each order, with a minimum of 1 cent
  • Trading activity fee: $0.000119 per share, with a minimum of 1 cent and a maximum of $5.95.

If you buy ADRs, you might pay a custodian fee of between 1 cent and 5 cents per share, depending on the bank involved. Options also come with similar regulatory fees. You’ll also pay a contract fee of 65 cents per contract.

In many cases, you might not notice these fees because they are relatively small, and they are often included as part of the final transaction.

Aside from these fees, Moomoo charges zero platform fees. However, the app includes a disclaimer that charging zero platform fees is considered a promotion and may end at any point. If this happens, Moomoo would give 30-day notifications to relevant parties.

What is the minimum amount of money needed to invest with Moomoo?

Moomoo doesn’t have a minimum deposit requirement. However, to qualify for a free stock as part of the app’s promotion, you might have to meet a minimum. When you open your account, Moomoo will let you know how much you need to deposit to qualify for the free stock.

Other investment apps to consider

Moomoo isn’t the only investment app that allows you to invest in stocks, options, and ETFs. Two other considerations are Stash and Robinhood.

Stash offers access to individual stocks and ETFs, as well as fractional investing, which allows you to buy portions of a share with a few dollars. Stash works on a subscription model, beginning at $1 per month. In addition to providing investing access, you can also get banking and insurance access. Stash also has a rewards program that allows you to earn shares of companies.

Read our Stash review for a full picture of what it has to offer.

Robinhood also offers commission-free trading for stocks, ETFs, and options. On top of that, Robinhood provides cryptocurrency access. A subscription isn’t required, but you can pay a monthly fee to get access to margin trading and cash management products.

Read our Robinhood review.

Moomoo, Robinhood, or Stash might be what you’re looking for if you need a platform that offers investing tools and services in addition to trading. Carefully consider your goals and your needs before deciding which of the best brokerage accounts will work for you.

4.4

Public Benefits

  • Get $3-$300 in free stock when your account is approved*
  • Invest in 1000s of stocks and ETFs with fractional shares—no account minimums
  • Follow friends in a social feed and learn from a diverse community of investors
  • * Free stock offer valid for U.S. residents 18+. Subject to account approval.
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Author Details

Miranda Marquit Miranda Marquit has covered personal finance for more than a decade and is a nationally-recognized financial expert and journalist, appearing on CNBC, NPR, Forbes, Yahoo! Finance, FOX Business, and numerous other outlets.