411–420 of 547 posts
The reason why this happened is that their clearing house stopped fulfilling their orders (totally out of their control,) but Robinhood bungled this so badly, I honestly wonder if they'll ever recover. WeBull had to do the same thing but they have a clear reason rather than "protecting investors" etc.
Riddle me this, who is Robinhood's clearing house?
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Nonsense. Trouble is when government gives out monopolies, or supporting monopolies they like. Government currently closed side. Government has chosen atheism as its religion. Very hostile toward other religions. Everyone pays for government school, but want to a Christian education, then you have to pay twice.
That's like saying virginity is a fetish. Atheism is not a religion, it's a lack of belief in a supernatural deity.
Subtle difference, as required by the topic.
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That's just it though, Robin hood didn't delist gamestop. They just decided arbitrarily that their users are only allowed to sell it. Coincidentally, this is a move that highly benefits a major partner of theirs.
That connection is like 3 degrees of separation at best, though. Robinhood sells order flow to a number of market makers, one of which is Citadel Securities [1]. Citadel Securities is part of the Citadel group, which consists of a hedge fund (Citadel LLC) and a market making firm (Citadel Securities LLC) [2]. While both companies are owned by Ken Griffin and share many resources, they are split by a "Chinese Wall" [3…
Melvin Capital also said a day earlier that they do not give out comments on their positions and trading.
https://www.reuters.com/article/us-melvin-fund-evotec-de-idU...
Since the claim that they closed their position in itself would potentially influence the market to their benefit, I don't see a reason to trust their statement.
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I've been reading WSB since yesterday and while I understand the outrage about blocking trading. They started blocking trading with $GME trading in the $400's, and a slew of redditors on WSB, Discord & Telegram pushing penny stocks. It started out a crusade against the hedge fund shorting $GME and quickly turned into rallying dumb money to pump and dump penny stocks. Looking at the direction things were going it seem…
"This is Wall-street Dr. Burry, if you offer us free money, we're going to take it" Absolute nonsense. The exchange is protecting the trader from himself!! The exchange is designed to make money selling and buying. There is no reason they would stop either unless some big wig made a phone call.
Over many stocks and long periods of time, this works quite well. However the system breaks down if everyone is trying to buy the same heavily manipulated stock.
When retail in traders en masse decide that a trading platform is impinging upon their rights, the SEC should be obligated to open an investigation. Isn't this pretty much a major component of their intended purpose?
Reminds me of the scene in the The Big Short where the hot chick in the pool who currently works for the SEC (at the time) is in town in Vegas for a conference hoping to run into some Wall Street banker dudes so she can schmooze and float her resume to them. And it's not a conflict of interest.
One of the good things I see coming out of Robinhood blocking trading, Twitter and Reddit booting problematic users, Parler getting vaporized, etc. is a sudden realization amongst people of just how easily major parts of their lives can be instantly turned off by intermediaries. My hope is that this will drive a reformist movement around digital rights (speech, commerce, etc.) As well as a movement from platforms to…
Luckily yes. Online access would be hindered, but nearly all my financial resources are handled through a local credit union.
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I have a bit of knowledge from friends who work in fintech, and the sentiment among fintech companies seems to be that SEC doesn't matter. The fine is small and comes way too late. You can simply account for an approximate future fine and move forward with your shady business.
This will probably be my least popular post ever, but the explanation needs to get out there for why Robinhood stopped trading on GME. Selling a stock short is NOT illegal. It is a perfectly valid type of investment according to the SEC: “D. Are short sales legal? Although the vast majority of short sales are legal, abusive short sale practices are illegal. For example, it is prohibited for any person to engage in a…
Also robinhood doesn't allow selling naked options so that entire point of yours is moot.
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Optimally the result is Robin Hood is removed from the play and apple store for willfully defrauding their customers. Very real damages were suffered as a result of their willful actions. There was no warning and there was no way they did not know harm would come. Also if no retail traders could buy, who was buying the shares that they were forced to sell? If it was the short hedge funds, that has got to be a crimina…
It's a bubble. Bubbles pop. Robinhood's argument would be that they prevented harm to investors by preventing them from putting money into a bubble that was going to pop anyway. As soon as this hit the news you got all kinds of regular people wanting to get in on the action, not connected to WSB.
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A margin call that liquidates a customer is not only perfectly reasonable but responsible on the part of the broker. I would never hold it against Robinhood to liquidate positions or have restrictions on buying/selling stocks where the broker could be at risk. The problem is that Robinhood is selling positions that are fully covered by their clients as well as prohibiting the buying of shares even when the purchase i…
@Kranar exactly. the actions of the gme swarm are reasonable given the positions and the patterns of actions we all recognize from short sellers. until now, short sellers have pretty much been playing a game of poker where no one ever called their bluff. Of course, the short sellers that lost out on this can just blame it on covid and get bailed out.
"Although some short squeezes may occur naturally in the market, a scheme to manipulate the price or availability of stock in order to cause a short squeeze is illegal." - https://www.sec.gov/investor/pubs/regsho.htm
I wouldn't be surprised if Robinhood and other brokers' compliance teams made the decision that the penalty for shutting down trading was less than the potential fallout for enabling illegal market manipulation behavior. Just because it's coordinated online between individuals doesn't mean that it's not illegal market manipulation.