Trading app Robinhood strikes deal with Pluto Capital to leverage AI

Trading app Robinhood strikes deal with Pluto Capital to leverage AI

(Reuters) – Robinhood Markets said on Monday it has bought artificial intelligence-based investment platform Pluto Capital. In doing so, it adds the trading app to a growing list of companies looking to offer customers AI tools.

Top technology companies are rushing to build AI into their products and services. Generative AI, which aims to create human-like interactions by processing large amounts of data, has taken the world by storm, with analysts expecting it to lead the transformation across industries.

The Menlo Park, California-based company said the deal will give investors on the platform access to enhanced data analytics, personalized investment strategies, real-time insights and portfolio optimization.

The Robinhood platform has seen a revival in trading activity after a prolonged slump as higher interest rates and severe market volatility made investors risk-averse.

The company’s popularity and appeal were immortalized in the retail trading saga of 2021, when it became the platform of choice for retail investors who used it to pump money into so-called “meme stocks” during pandemic-era lockdowns.

Since then, the company has strived to become a full-fledged financial services provider and is pursuing growth through deals and product launches that go beyond traditional transaction-related revenue.

Last month, it agreed to acquire crypto exchange Bitstamp for about $200 million in cash, the largest deal ever.

Robinhood said Jacob Sansbury, the founder and CEO of Pluto, will join the company, tasked with expanding and accelerating its AI-focused offerings.

Shares last fell 0.6% in choppy trading. The company did not disclose the terms of the deal.

(Reporting by Manya Saini in Bengaluru; Editing by Krishna Chandra Eluri)