The US government is considering giving Robinhood oversight responsibility for its new “Trump Account”.
If selected, Robinhood would act as a trustee of the accounts, which are initially set to hold $1000 on behalf of children born between the start of 2025 and the end of 2028, Bloomberg reported yesterday.
Funds in the accounts would automatically be invested in US companies, with the tax advantages of an Individual Retirement Account (IRA).
Eligible investments would include mutual funds or ETFs that track indices of US stock and charge less than 0.1% in annual fees and expenses.
Each account will accept contributions up to $5000 per year. Savings would generally not be able to be withdrawn before the child turns 18, similar to the restrictions on Junior Individual Savings Accounts (JISAs) in the UK.
The broker, or brokers, which are awarded the role of trustee for the new accounts could be handed millions of new customers, which is also the case of the funds which are ultimately selected.
This has led trade groups, including the Investment Company Institute, to bring open competition to the new accounts.
Shares in Robinhood Markets rose in late trading on Thursday following the report.
