How to Setup Robinhood Stock Lending to Earn Extra Income on Your Portfolio
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Robinhood Stock lending allows you to get the opportunity to earn income on stocks you already own—just by turning on Stock Lending. Robinhood work to find borrowers and you get paid when there’s a match. Robinhood makes fully paid securities lending, and the opportunity for passive recurring income that comes with it, available to customers who traditionally have not had access to it. You need to enable Robinhood Stock Lending, a customer gives Robinhood permission to lend out any fully paid stocks in their portfolio. Once shares are loaned out, customers can easily track earnings, see their positions, and enable or disable Stock Lending at any time, all through our intuitive in-app dashboard.
Why would someone want to borrow a stock? Financial institutions and other market participants will often borrow stocks for many reasons, including to cover deficits, failed deliveries, collateral, or to cover short sales. This is why stocks with low market availability and high demand are more likely to be borrowed.
With Stock Lending: Leave it to Robinhood to finding borrowers and lending out shares from your portfolio.
Earn interest Receive automatic monthly payments for any loaned out shares.
Trade with no restrictions Sell your shares at any time and realize gains or losses as you would otherwise.
How much could you make? Example annual earnings $150.00 Hypothetical stock value on loan $10,000 Hypothetical annualized lending interest rate 1.50%
What else should I know?
Only stocks on loan earn income Robinhood can’t guarantee that they'll find borrowers for your portfolio.
Dividends are paid out differently Dividends earned by stocks on loan are paid as cash and may be taxed differently than typical dividend payments.
Shareholder voting rights are modified You won’t be able to vote on proposals, like board of directors appointments, for a company when your stocks are on loan.
You’re protected with cash collateral Instead of SIPC insurance, Robinhood use cash collateral to protect your loaned stocks.
Note for margin-enabled customers You can turn on Stock Lending, but your portfolio won’t be considered for lending while you have a margin balance.
If you do not have Robinhood Account sign up using this link: https://join.robinhood.com/chandrg151
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