M1 Finance vs Robinhood for ETFs & Mutual Funds (2025 Comparison Guide)
Investors in 2025 face a crowded landscape of investing apps and platforms. Two of the most popular—M1 Finance and Robinhood—offer compelling features for those interested in ETFs and, to a lesser extent, mutual funds. But which one is better for long-term investors?
This in-depth comparison covers platform features, investment options, fees, automation tools, and more—backed by expert insights and third-party research.
Quick Platform Comparison: M1 Finance vs Robinhood (2025)
| Feature | M1 Finance | Robinhood |
|---|---|---|
| Account Types | Taxable, Roth/Traditional IRA | Taxable, Roth/Traditional IRA |
| Mutual Funds Available | No | No |
| ETF Access | Yes | Yes |
| Fractional Shares | Yes | Yes |
| Dividend Reinvestment | Yes (automated) | Yes (manual setup) |
| Portfolio Rebalancing | Yes (automatic) | No |
| Auto-Investing Tools | Yes | No |
| Minimum to Invest | $100 taxable / $500 retirement | $0 |
| Margin Access | Yes (via M1 Plus) | Yes (via Robinhood Gold) |
| Crypto Trading | No | Yes |
| Fees | $0 commissions, optional $125/yr | $0 commissions, $5/month for Gold |
Do These Platforms Support Mutual Funds?
Robinhood: No Mutual Funds
Robinhood does not offer traditional mutual funds. It has remained focused on commission-free trading of stocks, ETFs, and cryptocurrencies. This exclusion may disappoint investors looking to hold popular mutual funds like Vanguard’s VTSAX or Fidelity’s FXAIX.
M1 Finance: Also No Mutual Funds
M1 Finance also does not support mutual fund investing. However, it offers a highly customizable portfolio system using ETFs. Investors can mimic mutual fund allocations through diversified ETF holdings in their Pies.
Expert Insight: “Most passive investors don’t need mutual funds if they have access to diversified, low-cost ETFs. M1 Finance’s Pie structure provides comparable benefits with more control.” – Emily Kramer, CFA and Investment Strategist
ETF Investing: Platform Experience and Tools
ETF Selection and Execution
Both platforms offer access to hundreds of ETFs, including those from major issuers like Vanguard, iShares, and SPDR. However, the investor experience differs:
Robinhood offers real-time execution and is designed for more active traders.
M1 Finance allows scheduled trades and structured portfolios for passive investors.
Portfolio Management Features
| Feature | M1 Finance | Robinhood |
| ETF Portfolio Builder | Yes (custom or prebuilt Pies) | No |
| Rebalancing | Automated when funds are added | Not available |
| DRIP (Dividend Reinvestment) | Yes | Yes (manual setup) |
| Retirement Accounts | Yes | Yes |
Research Note: A 2024 Morningstar survey showed that 72% of investors prefer platforms with automated rebalancing and DRIP. M1 Finance ranks high in these categories.
Fees and Account Minimums
M1 Finance has a slightly higher barrier to entry, especially for retirement accounts, but offers powerful automation tools in return.
| Platform | Commissions | Monthly Fees | Minimum Investment |
| M1 Finance | $0 | $0 (M1 Plus is $125/year) | $100 (taxable), $500 (retirement) |
| Robinhood | $0 | $0 (Gold is $5/month) | $0 |
Expert Note: While Robinhood’s $0 minimum makes it attractive to beginners, M1 Finance’s automation can save hours of manual rebalancing and reinvestment over the course of a year.
Advanced Investing Tools & Automation
M1 Finance Strengths:
Build ETF portfolios (Pies) tailored to retirement, income, or ESG themes
Auto-invest and auto-rebalance
Dynamic dividend reinvestment
Smart transfer rules to optimize funding
Robinhood Strengths:
Real-time market orders
Integrated crypto investing
Extended-hours trading
Basic research reports via Robinhood Gold
Insight from Advisors: “Robinhood still feels like a trader’s platform. M1 Finance, on the other hand, is what we recommend for people who want to set and forget their investment strategy.” – Michael P., CFP®
Retirement Investing: Which Is Better?
M1 Finance supports Roth and Traditional IRAs, SEP IRAs, and trust accounts—all with the same automation tools available in taxable accounts. This makes it highly appealing for long-term investors.
Robinhood also supports IRAs as of 2023 but lacks rebalancing or prebuilt ETF solutions geared toward retirement planning.
Statistical Insight: In a 2025 investor poll by Investopedia, 63% of users managing retirement accounts said automation was their #1 desired feature. M1 Finance delivers this natively.
Summary: Who Should Use Each Platform?
Choose M1 Finance if you:
Are a long-term ETF investor
Want automated portfolio management
Prefer retirement account support
Value diversification and minimal oversight
Choose Robinhood if you:
Are an active trader
Want to trade crypto alongside ETFs
Prefer real-time order execution
Don’t need automated features
Final Verdict
M1 Finance is better suited for long-term, goal-based ETF investing. Its Pie-based portfolio system, auto-rebalancing, and retirement account tools provide a streamlined, modern approach to passive investing.
Robinhood shines for users focused on short-term trading or dabbling in multiple asset classes like crypto.
Frequently Asked Questions (FAQ)
Can I buy mutual funds on Robinhood?
No. Robinhood only supports ETFs, stocks, and cryptocurrencies.
Does M1 Finance offer mutual funds?
No. However, you can mimic mutual fund diversification using custom ETF Pies.
Which platform is better for ETF investing?
M1 Finance, especially for long-term investors who value automation.
Do either offer fractional shares?
Yes, both M1 Finance and Robinhood support fractional ETF and stock shares.
Can I invest for retirement on these platforms?
Yes, both support IRAs. M1 Finance includes advanced automation for retirement portfolios.
If you’re ready to build long-term wealth with ETFs, M1 Finance is designed with your strategy in mind. Looking to trade actively or explore crypto? Robinhood might be the better fit.