If you’re an active trader, you surely understand the importance of getting real-time data on stock prices. Most brokers offer this service for free once you open an account with them, but some traders may face some issues. If you have a Robinhood account or you’re intending to open one, you should know whether Robinhood prices are delayed or not…
No, Robinhood prices are not delayed, but there might be the occasional few-seconds difference when compared to other brokers’ feed. Keep in mind that the free plan of Robinhood only includes Level I quotes. You will need to get Gold for Level II ones.
Let’s take a look at how you can get Level II quotes for free on Robinhood and then explain the difference between Level I and Level II quotes.
How Do I Get Level II Quotes on Robinhood for Free?
If you haven’t experienced Level II real-time data before, you can sign up for the Gold free trial. It will let you get access to Level II quotes for 30 days. If you want to keep your Gold subscription, know that it costs $5 per month.
To upgrade your subscription you must first place an equity order.
If you use the mobile app, tap the “Account” icon that is placed at the bottom of the screen. Afterwards, tap the 3-bar icon and then “settings”. Then you need to tap “Robinhood Gold” and it will take you from there.
If you use the website, simply click on the “Account” that is located at the top right of your screen. And then, select “Robinhood Gold” and you will be having access to Level II quotes in no time.
What are Level II Quotes?
Investors and traders benefit from Level II quotes as they give more information than ordinary real-time feed (Level I). They show more detail regarding the bid and ask prices.
If you get access to Level II quotes, you will be able to see how many shares are on each side of the market, the volume at any time, and many more indicators. More precisely, you will be able to see all the resting limit orders along with the bids and asks on the price chart.
For example, if someone places a limit order to buy 5 shares of one stock at $50 each and that order rests on the Nasdaq market (Robinhood account), it will appear on the Level II chart as a bid. If that order gets executed, it will be removed from the Level II chart and appear on the main chart at a sale price.
All in all, if you’re an active trader, you will find it very convenient to see not just the bid and ask prices, but also all the orders on the market, including the volume at each bid and ask.
If you’re a long-term investor, on the other hand, Level I quotes will prove sufficient.
What’s the Difference Between Level I and Level II Quotes?
Now that we got the basics of Level II quotes out of the way, let’s take the differences that they have with Level I quotes.
Level I quotes will provide you with the number of traders who intend to trade a stock along with the current bid and ask.
Level II quotes, on the other hand, will show you the number of traders that there are for each price point of a stock. Technical analysts who depend their decisions on the direction of the trading pressure will benefit greatly from this kind of information.
When it comes to liquidity data, Level I quotes don’t provide any. They only show you the present bids and asks. You have no way to identify the trend of the stock.
But Level II quotes also show you how many orders are awaiting execution. If you want to determine the speed at which orders are coming in, this will be very helpful.
As you may already know, the spread is basically the difference between the bid and ask price of a stock. The more wide the spread is, the harder for your broker it will be to execute the order at the desired price.
When you only have access to Level-I quotes, you will just be able to see the spread information regarding the current price. For most investors, this may be the only thing they need to see; and for most of us, it’s probably more than enough. Things are different for day traders though.
Level-II quotes will also show you the exact spread for each price point. If you’d like to accurately predict the best price you should enter a trade at, this will be most beneficial.
As I already told you, Robinhood prices are not delayed, but you may experience minor lags if you compare their feed to that of other brokers. Also, Robinhood does offer both Level I and Level II quotes. But you will have to pay for the Gold plan if you need the latter.
Level II quotes have many advantages over regular Level I data. They provide more depth to market data, offer more liquidity information and they take the spread data a little bit further. If you’re a short-term trader, there’s no doubt you will benefit from them. And the price that Robinhood charges is not significant.
I hope you enjoyed this article and that it answered your question. If yes, then consider sharing it with others who may benefit from it. As for any questions you might have, just comment below and I’ll get back to you as soon as I can.
Take care for now…
Over the past years, I have discovered several tools and products that have helped me tremendously on my path to financial freedom:
P.S.: The links below are affiliate links, which means I receive a small commission at no extra cost to you when you sign up for one of the services. Thank you for your support!
1) Take a look at M1 Finance, my favorite broker. I love how easy it is to invest and maintain my portfolio with them. I can set up automatic transfers, rebalance my portfolio with one click and even borrow up to 35% of my assets at super low interest rates!
2) Fundrise is by far the best way I've found to invest in Real Estate. You can diversify your portfolio by investing in their eREITs or even allocate capital to individual properties (without the hassle of managing tenants!).
3) If you are interested in crypto, check out Coinbase. I've started allocating a small amount of assets to the growing crypto space and Coinbase has just been a breeze to use. Once you register, make sure to also open a Coinbase Pro account to buy crypto at the lowest fees on the market (just 0.1%!).