Investing platform Robinhood Markets (HOOD) is working on a new way to help regular investors invest in private companies. Indeed, on Monday, the company filed an initial registration with the U.S. Securities and Exchange Commission to start the process of launching a new closed-end fund. This fund is called Robinhood Ventures Fund I and, if approved, would trade on the New York Stock Exchange (ICE) under the ticker symbol “RVI.”
Elevate Your Investing Strategy:
- Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence.
Interestingly, Robinhood’s CEO, Vlad Tenev, said that for many years, only rich people and large organizations have been able to invest in private companies, while regular investors have been left out. With this new fund, Robinhood hopes to change that by making those private investment opportunities available to everyone. This is similar to what has already started happening in Europe, where private tokenized stocks have been introduced to make investing more accessible.
However, it is worth noting that private tokenized stocks have drawn some criticism. To begin with, many experts say that they do not grant true ownership. Indeed, they argue that these tokens only promise a claim on a real share held by a custodian. In addition, they are considered a legal gray area, and there is the possibility that regulators could intervene at some point. Nevertheless, Robinhood appears determined to give retail investors access to the private market.
Is Robinhood Stock a Good Buy?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on HOOD stock based on 12 Buys, six Holds, and zero Sells assigned in the past three months, as indicated by the graphic below. Furthermore, the average HOOD price target of $125.19 per share implies 9.7% upside potential.
