This is ONLY if you enable margin trading via Robinhood Gold - they increased their margin requirements recently on GME and this will not happen to you if you are trading on cash.
Robinhood is automatically initiating GME sell orders on users' behalf
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Re: Robinhood is automatically initiating GME sell orders on users' behalf
#22This feels like RH is going to go under if they don’t make this move? Are they holding a lot of risk by not doing this or something?
And what repercussions would they face, surely they’ve flagged that risk and are doing it anyway.
Re: Robinhood is automatically initiating GME sell orders on users' behalf
#23He was margin called. This is literally how margin works, has nothing to do with GME or the Robinhood furor.
That was my thought process as well, but no where in the app message or email does it say the position was closed out due to a margin call.
Re: Robinhood is automatically initiating GME sell orders on users' behalf
#24Are these users trading on margin?
Yes, that's the big question here. If it's a margin trade, the broker is also a lender and has some discretion. If it's a cash trade, the broker has no risk and should not interfere. Does anyone know? This matters.
Re: Robinhood is automatically initiating GME sell orders on users' behalf
#25[deleted]
Re: Robinhood is automatically initiating GME sell orders on users' behalf
#26Most likely margin calls.
Will repeat what I said above:
This morning Robinhood conspired with Citadel to halt trading amid a short ladder sell to drive the price lower, allowing shorts to cover their losses with no competition.
This is blatant market manipulation and anti competitive behavior, and must be stopped.
Why does everyone insist on protecting billionaires who insist on playing the game with a different set of rules than the rest of us?
Re: Robinhood is automatically initiating GME sell orders on users' behalf
#27> due to the unreasonable risk involved in brokering your position, we have closed your X shares of GME for an average price of Y What in the world?? "In order to protect you from yourself, we have taken away your free will. Thanks!"
Where does tat say "to protect you from yourself"? Reads to me a lot more as "since brokering your position is an unreasonable risk to us, we stop doing so" (and the right to do so is likely lined out in their ToS)
Re: Robinhood is automatically initiating GME sell orders on users' behalf
#28Most likely margin calls.
Agreed, almost certainly the case.
However, they should have inserted some notice in the UI that this was a result of a margin call that couldn't be met, given the level of knowledge of many of their users.
Re: Robinhood is automatically initiating GME sell orders on users' behalf
#29> due to the unreasonable risk involved in brokering your position, we have closed your X shares of GME for an average price of Y What in the world?? "In order to protect you from yourself, we have taken away your free will. Thanks!"
you are using their brokerage. their rules. free will has nothing to do with it.
It's not possible for someone like me to purchase a publicly traded security without going through a broker. So what you're saying is that market participants can only participate if they do what the people making the market want?
Re: Robinhood is automatically initiating GME sell orders on users' behalf
#30For pointers to other vertices of this story graph, see https://news.ycombinator.com/item?id=25933543.