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Robinhood S-1 IPO

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Re: Robinhood S-1 IPO

#331

Post by stouset »

porb121 wrote: post #235
ok2938 wrote: post #209

Earlier quoted context omitted.

Funny that you are being played most, when you think you are in control.

You are literally required to get better fill prices than the market with PFOF. You aren't being played any more than if you just send a normal limit order to the market

Why—exactly—do you reason that someone is willing to pay $109 per user per year for their order flow?

Put another way, Robinhood’s actual customers are confident that they are able to extract in excess of $109 in value each year they purchase the flow of orders from a given Robinhood user. From where and/or from whom do you suppose this money is being extracted?

Re: Robinhood S-1 IPO

#332

Post by tptacek »

bumblelad wrote: post #321
this_user wrote: post #218

Earlier quoted context omitted.

> Finally, the GameStop fiasco was unforgivable and only a naive fool would accept the explanation given. Citadel is the MAJORITY of Robinhood revenue and was opposite that trade. Only someone who doesn't understand how any of this works would believe these absurd conspiracy theories. 1) Citadel is one of FIVE of wholesale market markets RH use. Even if they did refuse to accept orders for GME, why wouldn't their fou…

You can skim the S-1 and see why that is problematic. In 2020, 34% of their revenue came from Citadel. 75% of their entire revenue stream comes from forwarding their clients' orders to one of FOUR market makers like Citadel. This practice in and of itself is contentious, and they readily admit this in their risk factors section of the filing. They also readily acknowledge the absolute thrashing they would receive fin…

Is your suggestion that PFOF is "contentious"? Because practically all retail traders are customers of brokers that get rebated for sending trades to firms like Citadel. Even IB does on their normal plans. Message board people believe a lot of weird things about how markets work.

Re: Robinhood S-1 IPO

#333

Post by kccqzy »

LeftHandPath wrote: post #303
mherdeg wrote: post #239

Robinhood closed my brokerage account after I did transferred out assets (via ACATS transfer, to get a signup bonus with another brokerage without realizing capital gains). A few months later I asked how to reopen the account, using the "reopen account" form in their app to generate a support ticket. Three weeks later they sent an email saying that my account was permanently closed and I should apply for a new accoun…

Move to Schwab or TD Ameritrade (TDA has ThinkOrSwim which is great for day/swing trading; Schwab is acquiring TDA but you can continue to use the ToS platform after that goes through). And then never look back. At least give it a look: https://www.tdameritrade.com/tools-and-platforms/thinkorswim...

I had a trial (with paper trading) with ToS a while ago, before the Schwab acquisition. I didn't find their platform particularly compelling, so I went back to using StreetSmartEdge by Schwab. Can you explain why you find ToS better?

Re: Robinhood S-1 IPO

#334

Post by durpkingOP »

mherdeg wrote: post #239

Robinhood closed my brokerage account after I did transferred out assets (via ACATS transfer, to get a signup bonus with another brokerage without realizing capital gains). A few months later I asked how to reopen the account, using the "reopen account" form in their app to generate a support ticket. Three weeks later they sent an email saying that my account was permanently closed and I should apply for a new accoun…

this thread wasn't made for you to spout your unrelated account shutdown

Re: Robinhood S-1 IPO

#335

Post by itchyouch »

adabyron wrote: post #113
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…

M1, E-Trade, Trading 212, Interactive Brokers, TD Ameritrade/Schwab and WeBull halted options as well.[1] There are a few more I'm missing. I wasn't happy about it but I don't blame them. As much as people were talking about over 100% of GME shorted, I can't imagine how much margin on top of margin people were trading while there options had yet to be settled. If anything the issue should be how long it takes a trade…

Options are always automatically halted on the options exchanges when the underlying stock is halted. GME was constantly hitting volatility circuit breakers due to the large price moves during the squeeze.

These institutions were limiting the quantity that users could purchase, not necessarily halting the options.

Re: Robinhood S-1 IPO

#336

Post by fakedang »

jackson1442 wrote: post #202
WYepQ4dNnG wrote: post #159

Earlier quoted context omitted.

> 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…

I definitely fell into this trap, but fortunately came out ahead. After switching to Vanguard I feel more comfortable in my investments since I don't feel the time-pressure to check performance etc. RH feels too much like a social network where it's trying to push you to buy and sell every single day while more traditional brokerages follow a "set it and forget it" path.

This is also what I've noticed, and it mirrors with investing mentality of their respective users too. Schwab, Fidelity and Vanguard (the 3 platforms I looked at before going with Schwab) gear their experience towards a long-term investing mentality. They'll do a large number of checks and forms until they'll let you perform certain trades (options, futures, derivatives, etc). You actually need to pass a few tests to do those. Meanwhile RH makes that as easy as slicing butter with a warm knife, and barely warns its users of the risks.

Re: Robinhood S-1 IPO

#337

Post by fakedang »

tptacek wrote: post #198
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…

The problem with the conspiracy theory about Citadel forcing Robinhood to halt GME is that plenty of providers for whom Citadel wasn't most of their revenue also halted GME. There are other reasons this conspiracy is silly, but that fact seems to kill it pretty dead. I don't like Robinhood and don't feel any need to apologize for it; I think they're predatory. But this isn't why. "Fraud of the century" is pretty funn…

Idk, Schwab,Vanguard and Fidelity still allowed us to trade GME.

Re: Robinhood S-1 IPO

#338

Post by wolverine876 »

waych wrote: post #276
elliekelly wrote: post #210

Earlier quoted context omitted.

Are the new traders introducing more information to the market? Or are they introducing noise?

You misunderstand. The information is there, constant, regardless of how many participants are in the market. The addition of new participants helps spread, judge and value the information, more than fewer participants, which allows the information to be better incorporated into the price, resulting in a more efficient (fair value) market. As a result, the asset becomes more liquid and "fairly priced". There is no "r…

We may be confusing market efficiency and economic efficiency. Economic efficiency is about limited assets (money, etc.) being used most productively. The economic value of something isn't arbitrary or whatever the market says; it depends on how productive it is. For example, the market may price Dutch tulip bulbs at thousands of dollars each, but that's not their value nor is it economically efficient to tie up thousands of dollars in a tulip bulb.

Market efficiency can contribute to economic efficiency. I've long been aware of theories that markets are inherently perfect and accurate, but I believe economists abandoned those ideas many years ago. Efficiency depends on the spread of information; if a large part of the market lacks accurate information or has false information, efficiency is reduced.

> The addition of new participants helps spread, judge and value the information, more than fewer participants

Imagine a market for rockets, and the market participants are the heads of Boeing, Blue Origin, SpaceX, NASA, ESA. Now imagine that we added 1,000 random people to that market; would the information be better? Would the rockets be priced better? Probably not. The market would be flooded with bad information.

Re: Robinhood S-1 IPO

#339

Post by ffggvv »

newfonewhodis wrote: post #173

Looks like the founders already sold $220M worth of stock: > 2019 Tender Offer > In August 2019, we entered into a letter agreement with certain holders of our capital stock, pursuant to which we agreed to waive certain transfer restrictions in connection with, and assist in the administration of, a tender offer that such holders proposed to commence. From August 2019 through September 2019, these holders commenced a…

“dumping all the risk”

except it’s ipoing for far higher price than they got. so the employees are going to make far more per share than they did.

Re: Robinhood S-1 IPO

#340

Post by bob1029 »

nvr219 wrote: post #292
bob1029 wrote: post #251

Earlier quoted context omitted.

I went through this exact same scenario. Had to create another email address to get the 2nd account going. Total garbage experience.

Why did you want to go back there so bad?

I maintain multiple brokerages. Fidelity, IBKR and Robinhood.

The reason I keep RH around is because they have virtually zero restrictions around advanced trading. I basically put all my hyper-risky options stuff in the RH bucket.

All my serious money lives elsewhere. I use RH pretty much exactly the way they want me to.

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