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Robinhood apparently selling people's shares ”for their own good“

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Re: Robinhood apparently selling people's shares ”for their own good“

#11

Post by Reason077 »

joncrane wrote: post #2

what on earth?!?! I can understand mandatory liquidation due to margin requirements. But AFAIK those don't show up as "orders" on your account that you can see in time to try to cancel.

I’d guess that this must be a margin account. In that case the broker is perfectly entitled to liquidate positions that they consider too volatile and risky.

If it’s a cash account, then yes, they’d have no right to do this. I’m no lawyer, but I’d assume you’d very likely be able to sue them for any losses.

Re: Robinhood apparently selling people's shares ”for their own good“

#12

Post by uniqueid »

swyx wrote: post #4

just a reminder not to believe random images off the internet that can be easily doctored. its possible RH is doing this, but also doesn't make much economic sense if it is just a normal share holding. Hold out for proof. Let's not have HN spread every sensational tweet.

Thank you. This WSB GameStop phenomenon is one of the most poisonous news stories I've seen in the history of the web. It seems to induce irrationality and melodrama as though it were a psychedelic drug.

Re: Robinhood apparently selling people's shares ”for their own good“

#14

Post by joncrane »

Reason077 wrote: post #11
joncrane wrote: post #2

what on earth?!?! I can understand mandatory liquidation due to margin requirements. But AFAIK those don't show up as "orders" on your account that you can see in time to try to cancel.

I’d guess that this must be a margin account. In that case the broker is perfectly entitled to liquidate positions that they consider too volatile and risky. If it’s a cash account, then yes, they’d have no right to do this. I’m no lawyer, but I’d assume you’d very likely be able to sue them for any losses.

But even in a margin account, the broker just "does it" and it shows up as an order after the fact, not one you can see in advance and cancel, AFAIK.

Re: Robinhood apparently selling people's shares ”for their own good“

#16

Post by xiphias2 »

uniqueid wrote: post #12
swyx wrote: post #4

just a reminder not to believe random images off the internet that can be easily doctored. its possible RH is doing this, but also doesn't make much economic sense if it is just a normal share holding. Hold out for proof. Let's not have HN spread every sensational tweet.

Thank you. This WSB GameStop phenomenon is one of the most poisonous news stories I've seen in the history of the web. It seems to induce irrationality and melodrama as though it were a psychedelic drug.

Maybe for you it's a news story, but for many of us it's a revolution.

Re: Robinhood apparently selling people's shares ”for their own good“

#18

Post by cma »

easton wrote: post #6

But the shares are the user's property. Isn't this theft, since the person got whatever robinhood thought it was worth without consent? (presuming the user wasn't buying on margin which probably includes an agreement that they will liquidate if you won't be able to cover reasonably).

It may be they bought and sold back and forth rapidly and the unsettled trades are considered on margin even if it was mostly netted out in and out of the same stock. Doing it without settlement itself is similar to naked shorting, because while it should all net out, trades can bust, especially in a short squeeze where people's long positions have been loaned out.

Re: Robinhood apparently selling people's shares ”for their own good“

#19

Post by Reason077 »

joncrane wrote: post #14
Reason077 wrote: post #11

Earlier quoted context omitted.

I’d guess that this must be a margin account. In that case the broker is perfectly entitled to liquidate positions that they consider too volatile and risky. If it’s a cash account, then yes, they’d have no right to do this. I’m no lawyer, but I’d assume you’d very likely be able to sue them for any losses.

But even in a margin account, the broker just "does it" and it shows up as an order after the fact, not one you can see in advance and cancel, AFAIK.

How it appears to the client would depend on the broker, the software, the situation, etc.

Re: Robinhood apparently selling people's shares ”for their own good“

#20

Post by vsareto »

xiphias2 wrote: post #16
uniqueid wrote: post #12

Earlier quoted context omitted.

Thank you. This WSB GameStop phenomenon is one of the most poisonous news stories I've seen in the history of the web. It seems to induce irrationality and melodrama as though it were a psychedelic drug.

Maybe for you it's a news story, but for many of us it's a revolution.

The GME shareholders that WSB turned into billionaires thank you for your revolutionary service
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