Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Robinhood and Didi to Kick Off a Hot IPO Summer

wsj.com

Post reply on HN
Print view View original

11–20 of 69 posts

Re: Robinhood and Didi to Kick Off a Hot IPO Summer

#11

Post by flefto »

vkou wrote: post #7
flefto wrote: post #5

Just a reminder that robinhood prevented people buying certain stocks while allowing them to sell, causing many people to lose money, but supporting the short selling hedge funds, whilst claiming to be “investment for the people”. Possibly they are rushing to IPO before facing court. I would neither buy shares IN Robinhood nor would I buy shares using a Robinhood account.

Just a reminder that Robinhood didn't prevent this. Automatic increases to clearing house collateral requirements prevented this. If Robinhood allowed those trades to go through, they'd have been cut off from the clearing houses, and none of their customers would have been able to perform any trades. Unfortunately, due to the low level of public understanding of how stock trades actually settle, the conspiracy narrat…

If so, why doesn’t this happen all the time?

In fact, when has it EVER happened before, or since?

If it was normal wouldn’t there regularly be stocks that can’t be bought but can be sold?

Re: Robinhood and Didi to Kick Off a Hot IPO Summer

#12

Post by Traster »

flefto wrote: post #5

Just a reminder that robinhood prevented people buying certain stocks while allowing them to sell, causing many people to lose money, but supporting the short selling hedge funds, whilst claiming to be “investment for the people”. Possibly they are rushing to IPO before facing court. I would neither buy shares IN Robinhood nor would I buy shares using a Robinhood account.

Is there any actual evidence this is true beyond just internet accusations?

Re: Robinhood and Didi to Kick Off a Hot IPO Summer

#13

Post by jasode »

jw1224 wrote: post #6
flefto wrote: post #5

Just a reminder that robinhood prevented people buying certain stocks while allowing them to sell, causing many people to lose money, but supporting the short selling hedge funds, whilst claiming to be “investment for the people”. Possibly they are rushing to IPO before facing court. I would neither buy shares IN Robinhood nor would I buy shares using a Robinhood account.

This is very important to know. Robinhood actively colluded with their hedge fund owners, by blocking buy orders — but not sell orders — under the guise of “increased margin requirements”. In fact, those margin requirements were being set by Robinhood’s prime broker and investor, Citadel Securities — who were set to lose billions if retail were allowed to keep buying.

>under the guise of “increased margin requirements”.

>In fact, those margin requirements were being set by Robinhood’s prime broker and investor, Citadel Securities

To clarify, you're saying NSCC(DTCC) National Securities Clearing Corporation was instructed by Citadel to increase margin requirements? Example story: https://www.cnn.com/2021/02/01/investing/robinhood-gamestop-...

Regardless of whether NSCC acted independently or under secret pressure from Citadel, what could Robinhood have done differently? If they didn't have the billions in the bank to control their destiny, what other options do they have? If the clearing house cuts off Robinhood's trade settlement, what are the realistic alternatives?

Re: Robinhood and Didi to Kick Off a Hot IPO Summer

#14

Post by vkou »

flefto wrote: post #11
vkou wrote: post #7

Earlier quoted context omitted.

Just a reminder that Robinhood didn't prevent this. Automatic increases to clearing house collateral requirements prevented this. If Robinhood allowed those trades to go through, they'd have been cut off from the clearing houses, and none of their customers would have been able to perform any trades. Unfortunately, due to the low level of public understanding of how stock trades actually settle, the conspiracy narrat…

If so, why doesn’t this happen all the time? In fact, when has it EVER happened before, or since? If it was normal wouldn’t there regularly be stocks that can’t be bought but can be sold?

Because stocks valuations don't jump by 2000%, with volumes up 3000% 'all the time'.

And when they do, they aren't solely driven by retail investor mania pig-piling the exact same brokerage.

And, uh, particular brokerages have stopped uni-directional trades for volatile stocks in the past, for the exact same reason. You may notice that no retail brokerage makes any guarantees to its customers that they will be able to trade anything, anytime they want. They don't carry a collateral that can meet any such guarantee.

Re: Robinhood and Didi to Kick Off a Hot IPO Summer

#15

Post by ruairispain »

Traster wrote: post #12
flefto wrote: post #5

Just a reminder that robinhood prevented people buying certain stocks while allowing them to sell, causing many people to lose money, but supporting the short selling hedge funds, whilst claiming to be “investment for the people”. Possibly they are rushing to IPO before facing court. I would neither buy shares IN Robinhood nor would I buy shares using a Robinhood account.

Is there any actual evidence this is true beyond just internet accusations?

There is evidence, was involved in it. Someone else took a screenshot. https://i.redd.it/86xuz0p7w2e61.jpg

RH is a front for organised crime, selling data to Citadel so the can front run retailers trades. Hope to see Senate action on it at some point.

Re: Robinhood and Didi to Kick Off a Hot IPO Summer

#16

Post by [deleted] »

vkou wrote: post #14
flefto wrote: post #11

Earlier quoted context omitted.

If so, why doesn’t this happen all the time? In fact, when has it EVER happened before, or since? If it was normal wouldn’t there regularly be stocks that can’t be bought but can be sold?

Because stocks valuations don't jump by 2000%, with volumes up 3000% 'all the time'. And when they do, they aren't solely driven by retail investor mania pig-piling the exact same brokerage. And, uh, particular brokerages have stopped uni-directional trades for volatile stocks in the past, for the exact same reason. You may notice that no retail brokerage makes any guarantees to its customers that they will be able t…

[deleted]

Re: Robinhood and Didi to Kick Off a Hot IPO Summer

#17

Post by [deleted] »

vkou wrote: post #10
jw1224 wrote: post #9

Earlier quoted context omitted.

No, Robinhood’s collateral requirements were increased by their clearing house only because their clearing house were on the hook to lose billions to retail investors during January’s short squeezes. The same clearing house used by Robinhood were the same people illegally naked-shorting GME. This is collusion, plain and simple. No part of this is representative of the “free” market.

Nonsense. Clearing houses don't lose anything during a short squeeze, as long as funds committed to a trade actually clear. They aren't the ones on the hook for a short exploding. They raise their collateral requirements during a period of high volatility. As it turns out, when you run a zero-fee brokerage, you don't just have a couple of extra billions of dollars lying around that you can put up as collateral on a m…

[deleted]

Re: Robinhood and Didi to Kick Off a Hot IPO Summer

#18

Post by Traster »

ruairispain wrote: post #15
Traster wrote: post #12

Earlier quoted context omitted.

Is there any actual evidence this is true beyond just internet accusations?

There is evidence, was involved in it. Someone else took a screenshot. https://i.redd.it/86xuz0p7w2e61.jpg RH is a front for organised crime, selling data to Citadel so the can front run retailers trades. Hope to see Senate action on it at some point.

That's not evidence that RH was:

> supporting the short selling hedge funds

Just to be clear: Robinhood claims that they prevented buying certain stocks because of increase collateral requirements by DTCC due to high volatility. Do you have any evidence that's untrue. Let's establish that before we move on to the claim that Citadel front-runs retail flow.

Re: Robinhood and Didi to Kick Off a Hot IPO Summer

#19

Post by jw1224 »

vkou wrote: post #10
jw1224 wrote: post #9

Earlier quoted context omitted.

No, Robinhood’s collateral requirements were increased by their clearing house only because their clearing house were on the hook to lose billions to retail investors during January’s short squeezes. The same clearing house used by Robinhood were the same people illegally naked-shorting GME. This is collusion, plain and simple. No part of this is representative of the “free” market.

Nonsense. Clearing houses don't lose anything during a short squeeze, as long as funds committed to a trade actually clear. They aren't the ones on the hook for a short exploding. They raise their collateral requirements during a period of high volatility. As it turns out, when you run a zero-fee brokerage, you don't just have a couple of extra billions of dollars lying around that you can put up as collateral on a m…

> The only people allowed to naked short are market makers

The SEC made naked short selling illegal after the 2008 financial crisis. Market makers are not allowed to naked short.

> Clearing houses don't lose anything during a short squeeze, as long as funds committed to a trade actually clear

Exactly my point — as long as funds clear, which they were at risk of not doing, thus putting clearing houses like the DTCC on the hook, in the event of a margin call.

Let me break it down:

- Melvin Capital were aggressively shorting GME

- Retail investors used Robinhood to take advantage of a short squeeze opportunity

- During the short squeeze, Citadel (who partly own Melvin Capital) bailed-out Melvin with a $2.8bn investment

- Citadel is Robinhood's prime brokerage, paying them for preferential order flow

- Citadel's global Head of Operations is on the board of the DTCC, the clearing house responsible for increasing collateral requirements

- As a market maker, Citadel care a huge amount about GME exploding, because if Melvin Capital were margin-called, Citadel end up holding the bag

- If Citadel are margin-called themselves, the DTCC clearing house end up holding the bag.

This is really just the tip of the iceberg. I'm consistently surprised at how defensive comments on HN seem to be towards hedge funds and the whole short-squeeze debacle — which is still very much ongoing. I can happily point anyone with an open mind in the direction of excellent research summarising the ongoing situation, and there's mounds of evidence indicating hedge funds never actually covered in January.

Not to mention the math on vote tallies in GME's latest 8-K filing from 2 days ago clearly proves more GME shares exist than should be mathematically possible, enabled only by naked short sellers who never covered.

Oh, and whilst I'm at it, their 8-K also disclosed that they've been working with the SEC since May to assist them with an active investigation in to market manipulation. Doesn't get much more obvious than that, does it?

But if it's easier to turn a blind eye, then each to their own.

Re: Robinhood and Didi to Kick Off a Hot IPO Summer

#20

Post by Traster »

These valuations are crazy - meaning one of two things are going to happen in the mid-term. Either we see inflation outside of asset prices (wage rises, increased consumer spending) and the revenue of these companies rise to justify the valuations, or we don't see that inflation and these stock prices slide since they can't justify their values. Now I'm not an economist - so maybe someone can help me out here. If the market slides because of lack of already priced in inflation, is that deflationary? And therefore could it bethat the asset price inflation we've seen recently could be reversed simply by a lack of retail inflation causing stock prices to drop therefore destroying asset price inflation?
Post reply on HN