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Robinhood S-1 IPO

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Re: Robinhood S-1 IPO

#181

Post by JoelSanchez »

arcturus17 wrote: post #106
rburhum wrote: post #48

I understand that many give Robinhood crap because it is not "sophisticated enough" or because of the Gamestop fiasco. Although many startups like to claim that they are "democratizing [x]", I honestly believe they did it. I have many friends that never traded before, and after they got their Robinhood account they feel comfortable enough to do it often. Even myself, who used to only trade a couple of times a year, s…

I really don’t understand this “democratizing” thing. In Spain, banks have allowed to trade on all kinds of assets for ages. Some with low fees. If you wanted to buy a certain asset you could do so in like three clicks. In the US I know as a fact that some banks like Charles Schwab have also made retail investing accessible for ages… Robin Hood has “democratized” trading in the sense of aggressively expanding it thro…

Just curious, what banks are those? Renta 4 is mainly focused on funds, and traditional banks like, say, BBVA, don't have any stock trading features in their apps / websites, as far as I know?

I'm using Degiro for stocks.

Re: Robinhood S-1 IPO

#183

Post by collias »

nscalf wrote: post #152
mulcahey wrote: post #18

I remember seeing their first public demo at LA Hacks in 2014. Seemed like a couple of kids right out of college. They had the iPhone's screen hooked up to the projector and one of their friends kept sending them silly text messages the whole time that they had to dismiss. This was before the Do Not Disturb feature came out. I remember wondering how it took so long for someone to make a half decent stock trading app…

Robinhood is the example I use for showing that good design can be a company making differentiator. In many ways Robinhood is much worse as a trading platform, but the usability and simplicity of getting started is orders of magnitude above all other competition.

Absolutely. Their front-end is phenomenal, even if their back-end is subpar.

It's to the point where I use Robinhood to look at market info, then open my actual brokerage app to execute the trade. Robinhood is lightyears ahead of traditional brokerages in terms of UX.

Re: Robinhood S-1 IPO

#184

Post by abriosi »

dang wrote: post #150
abriosi wrote: post #32

That's what happens when you spend a decade printing a lot of money Value becomes diluted

We detached this subthread from https://news.ycombinator.com/item?id=27702432 and marked it off topic. Please don't take HN threads on generic tangents. https://hn.algolia.com/?dateRange=all&page=0&prefix=true&sor... https://hn.algolia.com/?dateRange=all&page=0&prefix=true&sor...

I understand your detachment

For me there is a clear connection from flooding the system with cash and/or negative interest rates with hyper-financialization

"Dogecoin, created as a joke, is now in an S-1 as a material item" -> I consider this an hyper-financialization episode

The objective of the comment was to provide an simple explanation to a funny comment https://news.ycombinator.com/item?id=27702432

I also consider monetary policy one of the principal factors for so many services created around money and cashflows

Its gotten to the point that there are whole business models mounted around money and cashflow which bring negative value to the world

Although I understand the detachment I don't agree, because now the comment looks completely offtopic and tagent. I wish we could delete comments in these situations

Re: Robinhood S-1 IPO

#185

Post by gruez »

lottin wrote: post #164
gruez wrote: post #135

Earlier quoted context omitted.

>Actually the Fed doesn't pump dollars into the market Except when they did. Random google search: >The central bank began purchasing ETFs such as the iShares iBoxx $ Investment Grade Corporate Bond ETF (LQD) and the Vanguard Intermediate-Term Corporate Bond ETF (VCIT) in early May last year. However, even if all they do is buy bonds, money is fungible so those purchases will still spill over to other markets as inve…

If you are a bond holder, and the Fed buys $1000 worth of bonds from you for $1000, how is this causing everything to go up in price? Notice that your purchasing power is exactly the same before and after the purchase.

>If you are a bond holder, and the Fed buys $1000 worth of bonds from you for $1000

Then what, do you just keep that $1000 in cash while inflation slowly eats away at it? No, you'll invest it in something else (eg. stocks), so now the market for that has an extra $1000 injected into it.

Re: Robinhood S-1 IPO

#186

Post by ses1984 »

WYepQ4dNnG wrote: post #159
ditonal wrote: post #90

Earlier quoted context omitted.

Index funds democratized investing. Robinhood “democratized” the worst part of investing and exposed unsophisticated investors to the instruments they are most likely to underperform on. Individual stock picking is probably worse than indexes but fine, however the incentive to day trade or trade complex derivatives is almost certainly going to hurt people far more often than a Vanguard account. It’s not a coincidence…

> Index funds democratized investing. Robinhood “democratized” the worst part of investing and exposed unsophisticated investors On the spot! Robinhood has made it so easy to trade that I have seen many people trading from their mobile while having a coffee or commuting! I would really like to see all these "traders" in 5/10 years ... if it is true that 80% of day traders loose money .. I bet tons of improvised trade…

Everyone feels like a genius in a bull market. A pile of bread mold could make money in the stock market now. It won't last forever though.

Re: Robinhood S-1 IPO

#187

Post by 8note »

ditonal wrote: post #90
rburhum wrote: post #48

I understand that many give Robinhood crap because it is not "sophisticated enough" or because of the Gamestop fiasco. Although many startups like to claim that they are "democratizing [x]", I honestly believe they did it. I have many friends that never traded before, and after they got their Robinhood account they feel comfortable enough to do it often. Even myself, who used to only trade a couple of times a year, s…

Index funds democratized investing. Robinhood “democratized” the worst part of investing and exposed unsophisticated investors to the instruments they are most likely to underperform on. Individual stock picking is probably worse than indexes but fine, however the incentive to day trade or trade complex derivatives is almost certainly going to hurt people far more often than a Vanguard account. It’s not a coincidence…

What do you mean when you say "democratized investing" ?

That people can get benefits from the stock markets? Or that investment/economic decisions van be made democratically?

Index funds rely on the the folks making the index to determine which stocks get bought -- who's on the s&P 500 is not a democratic process

Re: Robinhood S-1 IPO

#188

Post by waych »

wolverine876 wrote: post #174
waych wrote: post #168

Earlier quoted context omitted.

While "day trading is an objectively terrible investment strategy" for most, having more people in the market and market participants being more fluid in their investments than not, is strictly more efficient than a market with less participants who act more illiquid in their positions.

Imagine a market of 1,000 people. If we add 5,000 who significantly under- or overvalue, or make other errors, the good being traded, is that more efficient? In terms of economic efficiency, if that's what we mean, I would guess not: It causes the misallocation of capital to worse investments. Was the Gamestop market economically efficient?

You are making the assumption that the first 1000 people somehow had a better way to value the assets being trading than the next group that joins the trade. This is a fallacy as the market sets the prices on its own.

No by efficiency I mean the spread and incorporation of more information relating to the underlying asset, making it more closely match their fair value, and the resulting tightening of the spread and reduced volatility overall. See Efficient Market Hypothesis.

It is also worth noting that it is this same hypothesis that backs the "index funds are better than stock picking" argument.

Re: Robinhood S-1 IPO

#190

Post by atombender »

mattbrewsbytes wrote: post #86
rburhum wrote: post #48

I understand that many give Robinhood crap because it is not "sophisticated enough" or because of the Gamestop fiasco. Although many startups like to claim that they are "democratizing [x]", I honestly believe they did it. I have many friends that never traded before, and after they got their Robinhood account they feel comfortable enough to do it often. Even myself, who used to only trade a couple of times a year, s…

I have read anecdotes that their ToS is geared towards them owning the securities because they pool purchases. Their business model is the brokers are the ones that actually pay them and potentially hold the securities. Also, from their recent "Systemic Supervisory Failures" [0]: > Between 2018 and late 2020, Robinhood experienced a series of outages and critical systems failures. The most serious outage occurred on…

Robinhood is a broker-dealer, and is subject to the same regulations as everyone else. All the major brokerages hold securities under their name ("in street name") on behalf of the customer. You still retain legal ownership, even for fractional shares. As far as I know, Robinhood has its own clearing house subsidiary, Robinhood Securities, that handles the share bookkeeping, including the fractional share inventory you're talking about.
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