Robinhood's head of investment strategy says retail traders are continuing to pile into stocks - and now favor long-term strategies over the rush of meme plays

• In an interview with Insider, Robinhood's head of investment strategy explained how retail investor behavior has shifted since last year.
• Everyday traders are now taking a longer-term, more educated view on investing compared to at the height of the meme-stock boom in 2021.

Robinhood established itself as a household name during 2021's meme-stock rally as retail investors swarmed the user-friendly trading app to send names like GameStop and AMC to the moon.

But now, with its retirement accounts and high-yield offerings gaining popularity, Robinhood is no longer just a hangout for the Reddit crowd, according to Steph Guild, the platform's head of investment strategy.

Guild, who worked at JPMorgan for two decades, says Robinhood users today are adopting a longer-term, more informed approach to investing compared to years prior. They continue to favor stocks, but their time horizon now reflects that of a more mature, educated investor.

Plus, she says the company's education tools and articles — including her own weekly column — have seen more traffic, and retirement accounts continue to garner an increasing number of sign-ups.

"Our customer base understands better now that investing is more of a longer-term game, rather than something fun," Guild told Insider in an interview this week. "Whereas a year ago customers opened accounts and just bought a couple stocks they felt were cool, now there's more recognition that you can't just bet on one or two horses, but you need to have a mix."

The stock sell-off in 2022 saw most of Robinhood's investors buying the dip on growth names like Tesla, Guild explained, which pointed to retail investors' focus on longer-term investing, rather than quick turnarounds.

Even as uncertainy lingers around the Federal Reserve's path of rate hikes — and how that will play into a credit crunch and possible recession — Guild notes that the largest holdings of Robinhood users haven't seen a material change, which suggests they are making informed decisions, rather than shifting behavior based on headlines.

As of April 3 data, top-performing names like Apple, Tesla, Amazon, and Nvidia were among Robinhood's most popular 10 stocks — a list that closely aligns with the S&P 500's top winners of the first quarter.

Further, more users are opting for the platform's $5-per-month premium feature, Robinhood Gold, which currently offers 4.4% APY on uninvested cash stored on the app. The attractive yield the platform is able to offer is a direct extension of the interest-rate hikes the Fed has enacted over the past year. The influx of customers to Gold is another sign that casual investors are taking a longer-term approach with their cash.

But despite the increased discipline Robinhood is seeing among users, meme-stock favorites like GameStop and AMC remain among the most popular stocks on the platform. Guild points out, however, that behavior around the names has changed, and that fewer users are trying to flip them for quick gains.

Going forward, she doesn't anticipate that any looming economic headwinds will sway behavior, given how customers held strong through last year's brutal stock-market winter.

"That was actually a worse environment for what they're holding," Guild said. "And they barely sold anything. I feel like they've weathered quite a bit of a storm based on the things they hold already."