Review: moomoo

The Bottom Line

moomoo is the mobile-first broking platform of the Tencent backed Chinese fintech, Futu Holdings. moomoo offers a gamified trading experience on its mobile and desktop platforms.

Currently moomoo offers access to only a few markets (SG, HK, China and US) and products. Their apps are well designed and easy to use but lack some critical features for Singapore based users.

Their promotional commission rate is the cheapest of all brokers for Singapore, but the all-in cost is higher if you need to convert FX to trade outside Singapore. Their fully loaded, all-in pricing is materially higher than our pick, Interactive Brokers.

What is moomoo?

moomoo is a new generation, mobile-first broker that is trying to make trading easier, more social and gamified.

moomoo is a brand of Futu Holdings, which is a Chinese brokerage and wealth management fintech platform backed by Tencent and listed on the NASDAQ (Ticker: FUTU). In Singapore, it is licensed by the MAS as a Dealer and Custodian.

Futu Holdings has 1.2mm customers globally, made a profit of US$171mm in 2020 and has a market capitalization of more than US$5bn at the time of writing.

For customers in Singapore, they provide access to the following countries and products:

Countries and Products covered by moomoo

How is it different from other Brokers?

Gamified & Social Trading moomoo’s mobile app is heavily focused on gamifying trading through regular incentives and rewards for signing up, frequent trading and referring new customers. They also encourage the social aspects by rewarding tasks like following other users and posting comments. This really differentiates the experience of using moomoo from the legacy brokers.

Mobile First moomoo does not have a web-based trading platform, unlike all the legacy brokers. The website only provides basic marketing & pricing information and directs you to download the mobile and desktop apps. All transactions are only possible via the apps.

Limited Coverage moomoo had one of the smaller product portfolios of the brokers we reviewed. At the moment you can only trade 4 markets (SG, US, HK, China) and 4 products (Stocks, Options, Futures and Funds) on their platform. There is no access to markets like UK, Japan, Australia or products like securities lending, CFDs, FX, Bonds etc.

What are their fees like?

moomoo’s all-in trading costs were consistently in the cheaper half of all the brokers we compared but it was much more expensive that our pick, Interactive Brokers (IB) in every market due to the higher FX conversion spread.

Even in Hong Kong and China where their advertised commission rate is significantly lower than IB (0.03% + min HK$18 for moomoo vs. 0.08% + min HK$18 for IB), the all-in cost on moomoo ends up being a lot higher for Singapore residents due to the much higher FX conversion spread that moomoo charges.

For Singapore listed stocks, moomoo advertises a lower rate than IB – 0.06% with a minimum of S$2.49 vs. 0.08% with a minimum of S$2.50 for IB. However moomoo passes on the SGX trading and clearing fee of 0.04% separately while IB includes that in its quoted price. On a like for like basis, the true commission rate for IB is 0.04% with a minimum of S$2.50, which is nearly a third lower than moomoo.

Commission Free Trading Promotion moomoo offers new users 180 days of commission free trading. This isn’t really free trading because they split their total fee into commission and platform fee in every market and only the commission is waived under this promotion.

To confirm this, we purchased 4000 shares of Singtel on 5 platforms (including moomoo) at the same time, and sold them 3 days later, again at the same time. We received identical execution price on all 5 platforms on both legs. The analysis of the actual commissions paid, in the table below, clearly shows that moomoo still charges the platform fee for the free trades and also does not include the SGX fees in the advertised commission rate.

So the free trades aren’t really free. However for the duration of this promotion, it does make moomoo the cheapest broker in the markets they cover. In our live trading test in Singapore, the all-in cost of a “free” trade on moomoo was about 10% lower than a fully loaded trade on IB.

Our recommendation is based on a fully loaded pricing for all brokers and assuming a Buy & Hold type of investor. However active traders may find it worthwhile to use moomoo in Singapore for the duration of the promotion.

However moomoo will not be the cheapest option outside Singapore even during this period as their FX conversion spreads are a lot higher than IB.

If you already have funds in the target currency, you may consider funding the account in that currency. However you may need to pay a transfer fee in that case. We did not test this scenario. Converting the FX at the Bank is not recommended as, in our testing, the local Banks had higher FX conversion spreads than moomoo.

What tools and data do they have?

Being mobile first, moomoo offers only two trading platforms – mobile app and desktop app. The default settings on both the apps were exactly as we wanted and nearly identical to the type of test setup we created on other platforms. By default the app opens with a watchlist, linked to the chart, news and fundamental analysis pages.

The minor customizations we needed for our trading setup were easily and intuitively finished. We finished the first 5 steps of our test setup in the least time of any platform we tried.

However we were surprised to find out that there is currently no way for Singapore based users to check their P&L in either app.

Apparently this feature is available in Futu apps outside Singapore, as its advertised on their website but their customer service told us it is not available to Singapore based users at the time of writing. This seems like a major hole in the functionality of the platform here and hopefully will be fixed soon.

The datasets available on the app are largely similar to what most brokers offer. You can get news from a number of sources (including selected video clips from Bloomberg), basic historical financial data for companies like Revenue mix, profitability and other ratios, data on major shareholders and events etc. The pricing data, while not comprehensive, was actually more useful than most other brokers as it offered access to many non-tradeable (on moomoo) instruments such as the KOSPI Index and Dogecoin, which other brokers did not have.

moomoo has an interesting twist on the usual screening function. They offer a number of pre-built strategies, largely based on technical factors like Bollinger Band breakouts and Golden crosses. The screening function also has a very large number of pre-built concepts like Metaverse, Outer Space, WallStreetBets and holdings of various famous funds like Soros and Goldman Sachs. Creating and sharing your own screens or strategies was also very easy.

Customer Service We loved the customer service experience at moomoo. A single click on either app gets you into a chat window. First the chatbot will attempt to answer your question. To bypass the chatbot, you simple need to type “agent” and select the nature of your query.

In every instance, a live agent started responding to our questions almost instantaneously. There was no waiting time even when the app warned up that the wait time could be longer than usual. And they were able to answer all our questions, usually quite fast.

After dealing with the customer service at all the legacy brokers, which were not too bad as customer service experiences go, this ability to instantly get a human to respond intelligently was a pleasure.

It did feel like the chat was happening through a translation engine, with our questions being translated (into Chinese?) and the agent’s responses being translated back into English. Sometimes they appeared to completely misunderstand our question. However we were always able to get our answer after rephrasing the question.

Community & Gamification moomoo is putting a lot of effort into the gamification of trading and encouraging the social aspects on their apps. You are constantly greeted with pop-ups on the mobile app offering coupons, cashbacks and points for trading or participating on the chat boards by posting or liking something, following other users or being followed by a large number of users.

You also receive badges documenting your journey on the platform and these are displayed next to your profile. The app highlights hot topics and conducts regular contests among users. There is also a leaderboard of portfolios created by users based on daily and monthly return and even the number of followers.

The desktop app is not as gamified and has fewer distractions.

moomoo vs. Tiger – which is better?

The battle of the new age brokers is a close one, with very little to separate them. By a very small margin, we favor moomoo for its better promotions and community.

While Tiger has broader product & country coverage, a fuller feature set (especially on P&L reporting) and lower minimum commission in Singapore, we feel that the only reason to prefer either of these brokers over our pick, IB, is for the promotions and the community. moomoo fairs better on both aspects and its apps are somewhat easier to use.

We found moomoo’s promotions to be better and the community more active. While Tiger offers 60 free trades in the first 180 days, moomoo simply makes all trades free. During our nearly identical usage of the platforms, we also got more cashback rewards from moomoo (2 x S$10) than Tiger (0).

In our usage moomoo also made more efforts to nudge us into trying out the community based features by highlighting the incentives for that. Tiger appears to offer similar incentives but the budge towards the community was missing, and in our opinion, the moomoo community is more active.

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