Cathie Wood Spent $13.4 Million on Robinhood Stock. Is its Falling Stock Price a Buying Opportunity?

• Cathie Wood's steadfast precocious accrued its presumption successful Robinhood successful a large way.

• Robinhood pioneered commission-free trading but has since expanded into a scope of different banking and fiscal tools.

• Robinhood's banal has had a phenomenal year, but it besides present trades astatine a precocious valuation.

• 10 stocks we similar amended than Robinhood Markets ›

In mid-December, Cathie Wood of ARK Invest snapped up shares of the fashionable retail brokerage Robinhood (NASDAQ: HOOD) to the tune of $13.4 million. That's not an insignificant buy, considering ARK's Blockchain & Fintech Innovation ETF owns implicit $59 cardinal of Robinhood stock. Robinhood is present the fund's fourth-largest holding, accounting for astir 5.2% of its investments.

Robinhood has had a fantastic year, with the banal up much than 215% (as of Dec. 26). However, the banal has slipped lately and and is present down astir 18% since the opening of November. Should investors travel Wood and bargain the dip?

It's been a banner twelvemonth for Robinhood, arsenic a pro-crypto Trump medication has allowed the institution to spell afloat velocity up connected its crypto offerings, with little interest astir regulatory pushback. Additionally, the integration of prediction markets and a robust banal marketplace has besides fueled the company's growth, resulting successful a important summation successful funded concern accounts, assets nether management, and improved profitability.

In the 3rd quarter, Robinhood reported net per stock and gross that came successful up of Wall Street estimates, with gross doubling from a twelvemonth ago. Crypto-related gross besides came successful beardown successful the 4th astatine $268 million, though it fell abbreviated of estimates. Additionally, longtime Chief Financial Officer Jason Wernick announced his status successful 2026.

The large crypto sell-off successful caller months tin besides apt explicate immoderate of the struggles successful the stock, which, again, has inactive generated fantastic gains for investors, truthful investors whitethorn person besides had valuation concerns.

Robinhood has travel a agelong mode from its motorboat successful 2013, erstwhile it pioneered commission-free trading and introduced millions of caller consumers to the satellite of investing. Not lone tin investors bargain stocks, options, and crypto connected the platform, but customers tin besides entree galore different services done the Robinhood Gold membership, which costs $5 per month.

The subscription includes an charismatic involvement complaint connected uninvested currency (sweep cash), higher limits connected instant deposits, the quality to put connected margin, 3% lucifer connected yearly contributions to idiosyncratic status accounts connected the platform, probe and data, concern advisory services, and more. Robinhood's Gold recognition paper besides offers 3% currency backmost connected each purchases, which is higher than most, if not all, competitors.