Is there any way to get cash out? I used Simple for years, and it was great but for the handful of times I needed a thousand dollars in cash.
Robinhood launches 3% checking account
581–590 of 684 posts
Re: Robinhood launches 3% checking account
#582I 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…
In America, I don't think contactless matters that much currently. It's really a crap shoot if any specific retailer supports contactless, no major metro system that I know of support direct debit / credit contactless cards and no major bank or credit card company issues contactless cards. If you want to use contactless in america, you add the card to apple / google / samsung pay and use your phone for NFC payments.…
I just got a Capital One card a month or so ago and unless I'm completely misunderstanding the graphics, it is contactless. I think they qualify as a major credit card company.
I've already switched to Apple Pay anyway.
Re: Robinhood launches 3% checking account
#583Earlier quoted context omitted.
Seems like a weak market to go after, given that people likely to respond to a "cool" financial services brand may be a poorer demographic that maybe doesn't have any prior experience with "legacy" financial services providers. So just because they create accounts @3% doesn't mean they'll also open trading accounts.
> Seems like a weak market to go after, given that people likely to respond to a "cool" financial services brand may be a poorer demographic that maybe doesn't have any prior experience with "legacy" financial services providers. Yeah but people do grow up. And I don't know about you, but I've got some super long term relationships with some banks. They are in it for the long game.
I find legacy banks a nuisance. They're always trying to get me to come into a bank branch.
Re: Robinhood launches 3% checking account
#584Earlier quoted context omitted.
> geeks who believe they have outmathed a financial firm should ask themselves "Are financial firms likely to be bad at math?" and "Are financial firms incapable of hiring their own geeks?" Moviepass was also bought by a financial firm... Come to think of it, they have many similarities. Both companies are basically handing out free money and it's unclear how they would make any profit. People speculate that both com…
Robinhood makes their revenue on rebate fees, it’s not illegal but considered shady by some people. Ordinary brokers generally don’t do that (although some might).
Robinhood sells order flow, profiting off of its users with exclusive agreements with high-frequency traders
Re: Robinhood launches 3% checking account
#585For 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…
> Metacomment: geeks who believe they have outmathed a financial firm should ask themselves "Are financial firms likely to be bad at math?" and "Are financial firms incapable of hiring their own geeks?" reminds me of the first time i interviewed at google, and one of the interviewers asked "if you could set up your own project and get a team to work on it, what would you do?". i answered that i would get a bunch of m…
Geeks can and do outmath financial firms and even bookmakers and casinos.
The financial firm, bookmaker and casino just needs to outmath the 99.9% of customers who are not trying to beat them to win, and evict the 0.01% of customers whose outmathing is so good it is causing them problems.
Re: Robinhood launches 3% checking account
#586For 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…
Things might be very different in the US, but interchange is nowhere near 2.5% for a debit card in Australia. Maybe that's what is levied to the merchant (or more) but by the time it gets back to the issuer, after merchant service fees and on-charged scheme fees it's more like 0.5% for a debit card.
I could be mistaken but business models built on interchange (I think) have been the downfall of a number of 'neo-banks' from the last 5-10 years. More recently I've seen people adopting a commercial-classified card (or other) for these types of plays for the sole reason of it attracting a higher rate of interchange vs a typical consumer debit card.
Re: Robinhood launches 3% checking account
#587Earlier quoted context omitted.
Why would they expect this account to be used as a high-velocity, low-balance account rather than a park-your-savings account, given the rate? I agree that the high rate is reasonable in that scenario, but the high rate is also actively fighting to ensure that scenario doesn’t happen. I don’t see people here thinking that Robinhood is bad at math. They’re all asking, “what’s the catch?” Because it sure seems like the…
Their treasury approach is probably very risky. Usually you want to build a tractor (recurring deposits to a reference rate) at the 7 or 10 year treasury, to ensure that you have a stable supply of available deposits, and a short term rate too to handle "hot money". You make money on the spread. I really don't see how they are funding their interest rate.
Margin lending?
Re: Robinhood launches 3% checking account
#588This is higher than even most long-term CDs at the moment. Anyone have thoughts on how this is possible? Possibly a teaser that will adjust down soon?
Exactly the correct point... it's not possible. You have to keep your money in there for a while (minimum thresholds)- there are probably caveats that you need to turnover a certain % of your Mastercard (since part of that 3% is on chargebacks). short term (1 year) treasuries are yielding 2.7%... so the only way to get 3% is to take more risk. Risky proposal to park your money with robin hood.
Well, it's FDIC insured when I checked, so you can get your money back if things go south. I wouldn't park all of my cash there, but I would consider putting a chunk of my savings there.
Re: Robinhood launches 3% checking account
#589Earlier quoted context omitted.
" Their whole business is to encourage folks that should not be day trading to day trade" Also using the ridiculously upside down moral convention that they are somehow 'the good guys defeating the system' i.e. 'Robin Hood'. "We wanted to do something after occupy Wall Street, you know. Something real. So, how about, get all the young people to, you know, put their money into Wall Street" is basically their 'storyboa…
It's amazing how many times I've seen people post losses in excess of $20,000 on r/wallstreetbets.
It's one of my favorite subreddits for that reason. Though there are definitely some people that do seem to have a very legitimate gambling problem and I feel bad for them and their families.
There's one guy on there who lost nearly a million bucks. And another one who I believe has lost more than that, and hasn't posted a single thing in three months, since he finally made it all the way to bankrupt. Makes you think a little, I wonder if he's still alive.
I did learn that options are super exciting and a great way to lose every last penny. I got lucky and came out ever so slightly ahead on my run through WSB, but I got out of it and now I'm back to normal stocks even with my play money.
Re: Robinhood launches 3% checking account
#590Earlier 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…
To be fair, RH does sometimes have problems. They blew up the other morning and screwed over a number of people by closing their accounts for the day while they tried to figure out how their system credited them with options sales at 10-100x actual value. RH has definitely got bugs, and if I were serious about playing the market I'd go with IB or TW, or just about anyone else.