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Robinhood launches 3% checking account

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Re: Robinhood launches 3% checking account

#401

Post by RickS »

mgr86 wrote: post #331
superfrank wrote: post #301

Earlier quoted context omitted.

Robinhood definitely had down time yesterday, but I'd like to make a note that /r/Robinhood overreacts to things like crazy. I'm pretty sure 95% of the people in there are under 20 and daytrading options with less than $5000. I'm bringing this up because, while some people did lose money yesterday because of Robinhood's downtime, there we also a lot of people claiming to have lost money, but were blatantly lying. I'm…

Wouldn't you need 25k in your account to day trade options without being caught up as a RH pattern day trader?

Almost always. IIRC there are some trivially small exceptions – you can make I believe 3 trades a day before being classified as PDT – and I believe entry and exit of a single position count as two separate trades.

But there are a lot of everyday people rigorously swing trading with smallish accounts. I've had some really interesting chats with uber drivers who do this, since they're sitting around in front of a phone all day anyway.

Re: Robinhood launches 3% checking account

#402

Post by snowwrestler »

dunpeal wrote: post #384
snowwrestler wrote: post #377

Earlier quoted context omitted.

If this worked well enough to allow 3% interest on checking accounts, literally every single bank would already be doing it.

> literally every single bank would already be doing it. Your typical bank has far more than RobinHood's 300 employees, and far greater expenses in general. This is an example of a disruption.

What is your theory, that every single other financial institution has willingly taken on a bunch of expenses they don't need to?

This comment just reinforces my feeling that Robinhood's business model is to extract money from credulous customers who think they are too cool for regular banks.

Re: Robinhood launches 3% checking account

#403

Post by dangrossman »

coryfklein wrote: post #375

If you're looking for a good liquid place to park cash and you don't have a Robinhood invite, check out Dollar Savings Direct. They currently pay 1.8% interest on their savings accounts.

Synchrony Bank, Goldman Sachs Bank, Barclays Bank, HSBC Direct pay 2.05%.

Ally Bank, American Express National Bank, Discover Bank pay 2%.

Google "high yield savings" for lists that are updated monthly.

However, this Robinhood offer is for a "checking" account, which while not actually a checking account, still offers the liquidity of one. Savings accounts have a limited number of monthly transfers you're allowed, and you can't use one with a debit card as your main payment account.

Re: Robinhood launches 3% checking account

#404

Post by lvs »

patio11 wrote: post #115

For folks trying to understand this, some context which may be useful: Checking accounts are loss leaders virtually everywhere, the exception being smaller community banks. Their primary revenue stream was, once upon a time, net interest income, but these days due to the extremely low interest environment and alternate sources of funding the revenue stream is more weighted towards fees (primarily NSFs, although that…

Lol. When small banks start offering high interest retail accounts, it means they need deposits fast.

Re: Robinhood launches 3% checking account

#406

Post by snowwrestler »

sand500 wrote: post #330
count wrote: post #315

Earlier quoted context omitted.

This is a flawed view of the American system. Credit and Debit cards are different things. Debit cards are the European style 'put in a pin and money is debited directly from your bank checking account'. Credit cards are a revolving line of credit from a bank - you're spending against the LOC, and settle up on a monthly basis (to some extent - there's interest and pay-over-time involved in most as well). The differen…

Don't forget fraud protection on a credit card vs debit card.

Is there a difference? Last time I checked, my debit card offered the same protections my credits cards do.

Re: Robinhood launches 3% checking account

#407

Post by flexie »

mindslight wrote: post #317
flexie wrote: post #284

This whole checking account / savings account, credit card/ debit card system that Americans have to deal with is so cumbersome and backwards. For Europeans that don't know: Most Americans have (at least) those two accounts, and those two cards. They usually spend from their checking account with their credit card, and save on the savings account. When they spend on their credit card, they sometimes "earn" points, de…

I'm not trying to defend the warts of the US banking system, but... "Credit card" would be a third account that is purely debt-based. It's optional, and you can spend directly from your checking account with a "Debit card" instead. It's just not advisable, due to the broken-ass card system you described. "Savings account" is optional, but earns interest. Does your single EU account earn reasonable interest? Long term…

For the past 30 years my European accounts haven't offered any interest worth mentioning - and neither did my American ones.

Re: Robinhood launches 3% checking account

#408

Post by snowwrestler »

jancsika wrote: post #304

"Dude, have you tried ifood? After you ingest it your daily workout becomes 3% more effective." "Sounds interesting. Is it FDA approved?" "Well, no, it's FCC approved. You see, legacy foods are ripe for disruption because regulatory has capture created an artificial barrier to new marketplace entrants. With ifood we're able to end run that barrier by..." "Goodbye."

This is an underrated comment.

Re: Robinhood launches 3% checking account

#409

Post by simonsarris »

philip1209 wrote: post #332

I just spent 3 months in London, and it's crazy how Monzo seems to have taken the market. Almost everybody seems to be paying with a Monzo card, regardless of age. Asking around, I consistently heard that Monzo's competitors like Revolut are going to be a future case study in scaling before great product/market fit. I don't know how many people have Revolut accounts, but nobody seems to be using their cards in public…

> he US seems to have a wave of startups trying to reinvent checking accounts right now. I wonder which, if any, will take the market

Square's Cash App + Cash Card is taking the lead here, IMO. Card, direct deposit, ATM usage, p2p payments, rewards program.

They've been the #1 app in finance all year on the Apple store, and were #1 in all free apps for a little while this past week. They are massively popular in the south, but the rest of the country may catch up, but I sort of wonder if silicon valley is gonna miss the rise since its out of sight for the time being. For growth and reach see for example:

Graph over time: https://trends.google.com/trends/explore?date=all&geo=US&q=c...

States where cash app dominates so far: https://trends.google.com/trends/explore?date=today%201-m&ge...

If Cash App introduced brokerage services it would be over for Robinhood.

Re: Robinhood launches 3% checking account

#410

Post by Apocryphon »

jkqwzsoo wrote: post #343
motivated_gear wrote: post #277

Earlier quoted context omitted.

It's amazing how many times I've seen people post losses in excess of $20,000 on r/wallstreetbets.

The people in r/wallstreetbets usually understand that they're making stupid bets. OTOH, r/Robinhood is full of completely irresponsible traders -- trading in illiquid securities, dumping tons of money in penny stocks, triggering PDT restrictions and getting stuck with unwanted positions, not understanding bid/ask/mark (usually blaming RH or the "market maker" boogeyman for changing the price on them), buying OTM wee…

Given the millennial user base, they probably were.
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