How Cash App Investing Works For Beginners

Cash App is a mobile banking platform that allows users to send, spend, save, and invest money. The app offers two types of accounts: individual brokerage accounts and Cash App Investing accounts. The former is for users looking to buy and sell stocks, while the latter is for those interested in investing in exchange-traded funds (ETFs). Cash App Investing accounts are self-directed and held by a third-party custodian, DriveWealth, LLC. The balance associated with this account is separate from the user's Cash App balance and represents the total current value of their investments. While Cash App does not charge any fees for most transactions, Bitcoin trades may incur small fees. The platform is best suited for beginners looking to dip their toes into investing, offering an easy and accessible way to trade with no minimum investment amounts.

Opening an investing account

Investing on Cash App allows you to create a brokerage account with Cash App Investing LLC, which is a subsidiary of Block, Inc. This account enables you to buy and sell stocks and exchange-traded funds (ETFs).

To open an investing account on Cash App, you must be a US resident and at least 18 years old. You will need to provide the following information:

• Social Security number
• US residential address
• Employment status and name of employer

This information is required to verify your identity and comply with regulations.

Once your account is open, you can start investing with as little as $1. You can choose to invest in a variety of stocks and ETFs, and Cash App does not charge any commission fees for buying or selling. You can also set up orders to buy stocks on a regular schedule or at a specific target price.

It's important to remember that investing involves risk, and you may lose money.

How to buy and sell stocks

Investing on Cash App allows you to buy and sell stocks and exchange-traded funds (ETFs). To get started, you need to open a brokerage account with Cash App Investing LLC. This is separate from your Cash App balance, which is used to purchase stocks or ETFs. If there are insufficient funds in your Cash App balance, the remaining amount will be debited from your linked debit card.

Buying Stocks:

• Search for a company name or ticker symbol.
• Choose how much of the stock you want to buy, either from a preset amount or by entering a custom amount.
• Stock purchases can be scheduled 24/7, but orders will only be placed during market hours.
• The US stock market is open Monday to Friday: Eastern time 9:30 AM–4 PM, Central time 8:30 AM–3 PM, Mountain time 7:30 AM–2 PM, and Pacific time 6:30 AM–1 PM.

Selling Stocks:

• Tap the Money tab on your Cash App home screen.
• Tap on the Stocks Tile.
• Scroll down to Stocks Owned.
• Select the company whose stock you want to sell.
• Select an amount or enter a custom amount.
• Confirm with your PIN or Touch ID.
• Depending on market activity, sales proceeds may take up to 1-2 business days to be deposited into your Cash App balance.

Please note that selling shares may have tax implications, and you should consult a tax advisor for guidance.

How to buy and sell exchange-traded funds (ETFs)

To buy and sell exchange-traded funds (ETFs) on Cash App, you first need to open a brokerage account with Cash App Investing LLC. This is a self-directed service, so you are solely responsible for the orders placed through your account.

Once you have your account, you can search for an ETF by its name or symbol, or explore by category. To do this, tap the Money tab on your Cash App home screen, then tap on the Stocks Tile.

To buy an ETF, choose how much of the stock you want to buy, either from a preset amount or a custom amount you enter. The stock can be purchased using the funds in your Cash App balance. If you do not have enough funds available, the remaining amount will be debited from your linked debit card.

To sell an ETF, go to the stocks you own on the Cash App, select the company whose stock you want to sell, and then choose how much of the stock you want to sell, either from a preset amount or a custom amount. The amount of your sale will be automatically deposited into your Cash App balance and may take up to two business days to be deposited, depending on market activity.

It's important to note that Cash App Investing may add, remove, or change the securities it supports at any time. ETFs with management fees above 1% are excluded from the platform, for example.

How to buy and sell Bitcoin

Investing on Cash App allows you to buy and sell stocks, exchange-traded funds (ETFs), and Bitcoin. Here's a detailed guide on how to buy and sell Bitcoin using the Cash App:

Buying Bitcoin:

• Open the Cash App on your device.
• Tap the "Investing" tab at the bottom of the screen.
• From the list of available investments, select "Bitcoin."
• On the Bitcoin screen, tap the "Buy" button.
• Enter the amount you want to purchase. You can either choose a preset amount or enter a custom amount.
• Review the details of your purchase, including any applicable fees.
• Confirm your purchase by following the on-screen instructions, which may include entering your PIN or using Touch ID.

Selling Bitcoin:

• Open the Cash App and tap the "Money" tab on the home screen.
• Tap on the "Bitcoin" tile to access your Bitcoin wallet.
• Decide on the amount of Bitcoin you want to sell. You can either select a preset amount or enter a custom amount by tapping "...".
• Review the details of your transaction, including the current Bitcoin price and any associated fees.
• Confirm the sale by entering your PIN or using Touch ID, and then tap "Confirm."

Please note that when you buy or sell Bitcoin using the Cash App, the funds will be transferred from or to your Cash App balance. Additionally, keep in mind that cryptocurrency values can fluctuate, so the price of Bitcoin may change between the time you initiate the transaction and when it is completed.

Understanding your Cash App balance

When you open a Cash App account, you can use it to make peer-to-peer payments, as well as invest in stocks, exchange-traded funds (ETFs), and Bitcoin. Your Cash App balance is the amount of money you have available in your Cash App account. This is separate from any investments you make through the app.

Your Cash App balance is where your funds are held when you make a purchase or sale of stocks or ETFs. If you do not have enough funds in your Cash App balance to cover the cost of a purchase, the remaining amount will be debited from your linked debit card. When you sell stocks or ETFs, the proceeds from the sale will be automatically deposited into your Cash App balance. You can then choose to use these funds to buy more stocks or ETFs, spend them using your Cash Card, send money to friends and family, or cash out to your linked bank account.

It's important to note that your Cash App balance is different from your Investing account balance. Your Investing account balance, or "stock balance," is the total current value of the investments you've made. This balance is held by a third-party custodian, DriveWealth, LLC, and is shown separately from your general Cash App balance.

Your Cash App balance is not protected by the Securities Investor Protection Corporation (SIPC). However, it may be eligible for FDIC insurance through Cash App's partner banks. The FDIC will cover eligible accounts up to $250,000 per Cash App customer. It's important to note that Bitcoin and investing balances are not covered by FDIC insurance.

To open a Cash App account, you must be a U.S. resident, 18 or older, and provide a Social Security number, U.S. residential address, employment status, and name of your employer. With a Cash App account, you can start investing with as little as $1, making it a great option for beginners who want to dip their toes into investing.

Frequently asked questions