Robinhood & TradePMR Deal Targets $7 Trillion RIA Market

Robinhood Markets, Inc. announced the acquisition of the portfolio management platform TradePMR, fueling its momentum in the wealth management space.

According to their announcement, TradePMR has $40 billion in assets under management and serves the $7 trillion registered investment advisor (RIA) market.

Robinhood Acquires TradePMR, Eyes $90 Trillion Wealth Transfer Opportunity

Robinhood plans to use TradePMR’s expertise to provide its customers with access to personalized financial advice through RIAs. The acquisition also allows TradePMR advisors to reach Robinhood’s 24 million accounts, primarily made up of Millennials and Gen Z users.

“This opens up a brand new TAM for Robinhood to go after. The wealth transfer will include $90T of wealth being passed down from Baby Boomers to Millennials/Gen Z. All that wealth will likely need guidance to manage and if Robinhood can have one of the best RIA platforms for users to access, they should be able to see that wealth expand their overall business,” said one crypto influencer on X.

TradePMR has been in operation for over 25 years and currently manages approximately 350 firms. This is Robinhood’s third acquisition in 2024, following their purchases of global crypto exchange Bitstamp and Pluto Capital, an AI-powered finance and research tool.

Robinhood will integrate TradePMR’s top-rated platform, Fusion, into its app. This will enable customers to view both their self-directed investments and managed assets in one place, making it easier to manage their finances. TradePMR will maintain its existing partnership with Wells Fargo for clearing and execution services.

They also plan to develop a referral program designed to link fiduciary advisors with Robinhood’s extensive customer network. This initiative intends to provide Robinhood users with convenient access to professional financial guidance while supporting advisors in expanding their client base.

“This is a big NEW service they will start offering to attract the wealth management industry like myself and Revere. Robinhood is known to have captured much of the younger generation especially GenZ and onward. This is BIG,” said one commentator on X.

Their shares, which jumped 1.5% before the opening bell, have gained 332% in 2024 at the time of writing. Their Q3 2024 earnings reached $14.4 billion, marking a 114% year-over-year increase from Q3 2023.

The deal, a mix of cash and stock, is expected to close in early 2025 after regulatory approval. Once finalized, Robinhood aims to build a comprehensive platform that connects advisors with customers while continuing to innovate its wealth management services.