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Robinhood, in Need of Cash, Raises $1B from Its Investors

nytimes.com

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Re: Robinhood, in Need of Cash, Raises $1B from Its Investors

#221

Post by PartiallyTyped »

amscanne wrote: post #54
sdan wrote: post #17

Earlier quoted context omitted.

And right after saying they don't have any liquidity problems said, "We're #1 on the app" while retail investors were losing millions because of expiring options/stocks. Absolutely tone-deaf. Not denying that all securities have risks, but that was a bad response imo.

Retail investors lost millions because of an inability to buy?

Yes. Low volume means you can launch a short attack and drop the price because there is nobody capable of buying. I saw my portfolio losing > 50% of equity during the attack.

Re: Robinhood, in Need of Cash, Raises $1B from Its Investors

#222

Post by avlewis »

kangaroozach wrote: post #128

Prediction: Robinhood loses class action and is bought by Schwab for pennies after founders plea bargain for 3 months prison and $20M in fine each and disappear into the ether like Adam Neumann.

After today, Id love to see RH get picked up for pennies on the dollar by Schwab treating it as a trade in at a Gamestop.

Re: Robinhood, in Need of Cash, Raises $1B from Its Investors

#223

Post by youngtaff »

nly wrote: post #204
kmlx wrote: post #199

Earlier quoted context omitted.

i've used: 1. revolut - these guys are complete jokers. closed after being asked to provide the proof of funding 3 times in 3 months. 2. hsbc/first direct - somewhat decent. but i only use it to top up my other accounts. i try to avoid them, as they're just too big. 3. starling - simple, no-nonsense banking from a startup. 4. revolut business - had my account closed down by the "bank" because they didn't want my busi…

If you need a EUR account with a good app, TransferWise, who power Revoluts multicurrency action on the backend, are pretty decent. Horrid luminous green card though. I'm an investor in Revolut due to their aggressive growth strategy, but I wouldn't use them personally. As for Monzo, I like their app but missing features like being able to view your full CVV number in app, or link the app to all your other bank accou…

TransferWise aren't a bank so the financial protects are slightly different

I use them for some of my overseas customers, my only challenge with them is the limited number of currencies they support e.g. had to open a Revolut account to get payment from a Canadian customer

Re: Robinhood, in Need of Cash, Raises $1B from Its Investors

#224

Post by codesternews »

egwor wrote: post #192
codesternews wrote: post #103

Earlier quoted context omitted.

Yes, they are forced to sell and other robinhood users could not buy. It means they allowed selling and restricted buying that will eventually make stock goes down because no other person even if they want to can't buy.

So the market price which is made from all transactions from all brokers will drop because robinhood users could not buy. That makes no sense to me. If they really wanted to buy they could use another broker? If the market really is dropping then tough luck. You can lose all your money investing in the stock market. If you're leveraged you can lose even more (which might explain why some accounts were closed).

I think you are naive and don’t know what’s happening. GME is emotional and hype play. They got so much coverage and all the retail people were driving prices up have robinhood platform.

You cannot open the account within same day even if people wantto buy. Robinhood played with people physchology. After seeing the price drop everyone wanted take profits out because even if people want to buy they couldnot.

It was logical short squeeze which could drive price of GME significantly up but due robinhood manipulation it stopped.

Re: Robinhood, in Need of Cash, Raises $1B from Its Investors

#225

Post by stickfigure »

AmericanChopper wrote: post #162
Clewza313 wrote: post #127

Earlier quoted context omitted.

There's day trading, and then there's taking out credit card cash advances to buy leveraged call options on a stock that's already gone up 1000% in a month. Both are risky, but the day traders I've known wouldn't touch the latter with a barge pole.

Would the day traders you know be happy using a brokerage who’s liquidity issue mean it’s had to ban trading certain securities? Even if they don’t want to YOLO like a maniac, why would you trust a company that’s had so many very public blunders with your money? It’s not like there aren’t more reputable zero-fee brokerages out there.

...which all did the same thing, no?

Re: Robinhood, in Need of Cash, Raises $1B from Its Investors

#226

Post by jozvolskyef »

kmlx wrote: post #199
onion2k wrote: post #96

Earlier quoted context omitted.

I’m not keeping my money with a financial institution that lies to me. I know for a fact my bank lies. They've been fined hundreds of millions of dollars for money laundering (it's HSBC). A few years ago I looked in to moving to a more honest bank, but I couldn't find one that also met basic criteria like having access to cash points in the UK and having a half decent mobile banking app. Literally every major bank th…

i've used: 1. revolut - these guys are complete jokers. closed after being asked to provide the proof of funding 3 times in 3 months. 2. hsbc/first direct - somewhat decent. but i only use it to top up my other accounts. i try to avoid them, as they're just too big. 3. starling - simple, no-nonsense banking from a startup. 4. revolut business - had my account closed down by the "bank" because they didn't want my busi…

I set up a revolut account for currency exchange in 2018 and finally moved to use them as my primary bank in 2020. Never had any significant issues. Recently I was setting up a Revolut Business account and I didn't get a notification email requesting additional evidence. Me not getting an email is something they could improve, but the need for a thorough identity verification is understandable given their global ambitions.

Edit: I'd like to add that revolut was very helpful after most of my valuables were stolen in 2019. While my other bank took three weeks to deliver a new debit card, a virtual card issued by revolut worked immediately via NFC.

Re: Robinhood, in Need of Cash, Raises $1B from Its Investors

#227

Post by ccmcarey »

Xxplosive wrote: post #118

I wonder if Robinhood is preparing for the possibility that its margin book gets blown up when GME inevitably crashes. Crashing price creates cascading margin calls and they can't liquidate their customers' positions fast enough and end up having to cover their losses, rendering them insolvent. Sequoia, thinking that the fundamentals of the company are still solid long term and that they can wash their hands of this…

RH are closing out some margin calls to decrease the risk of this happening afaik.

Re: Robinhood, in Need of Cash, Raises $1B from Its Investors

#228

Post by ummonk »

pishpash wrote: post #188
loycombinate wrote: post #138

So, every broker is on margin with DDTC, they don’t have to have 100pct cash for the dollar amount of the buy orders they send to DDTC, as long as they will have the cash in 2 day. Some brokers like fidelity have hoards of 401k money and more likely to have 100pct cash for their orders. Trading brokers like IBKR RH keeps the minimum possible amount of cash with DDTC, and their automated systems adjusted up the minimu…

Doesn't regular Robinhood require settled cash to trade? Edit: Nope, looks like Robinhood "Instant" is now the default, margin account, but still limited to $1000 per account: https://robinhood.com/us/en/support/articles/robinhood-accou...

I think it doesn't matter, as they can't use the client's cash on it until the stock is delivered at the end of the T+2 settlement period.

Re: Robinhood, in Need of Cash, Raises $1B from Its Investors

#229

Post by Leherenn »

beaker52 wrote: post #144

Why are there so many HN posts about Robinhood right now? I've seen 3-4 posts in the past 24 hours and it seems like every comment thread I read also mentions Robinhood in some respect. It feels like HN is in the middle of an invasion by people trying to draw attention to it, but there could be a coincidence? Is it just the buzz around this GameStop action?

It is, as far as I know, an unprecedented event with potentially far reaching consequences, not matter how it ends up. A huge market manipulation by a massive amount of retail traders, enabled by Robinhood and similar brokers, that has the potential to cause a lot of established players billions in losses.

How can and will the SEC react to this market manipulation; it seems unlikely they can pursue the millions of retail traders individually, so can we expect some new regulations instead? Can companies like RH exist in the same form in the future? The fact they stopped people from buying stocks may or may not have been legal, but it certainly distorted the action price. Again, I think this is pretty unprecedented, at least on this scale, so the financial landscape after all of this settle down might be significantly altered. Finally, if the short squeeze happens, what will be the consequences? Are we in for another huge financial crisis?

Re: Robinhood, in Need of Cash, Raises $1B from Its Investors

#230

Post by shafyy »

jozvolskyef wrote: post #226
kmlx wrote: post #199

Earlier quoted context omitted.

i've used: 1. revolut - these guys are complete jokers. closed after being asked to provide the proof of funding 3 times in 3 months. 2. hsbc/first direct - somewhat decent. but i only use it to top up my other accounts. i try to avoid them, as they're just too big. 3. starling - simple, no-nonsense banking from a startup. 4. revolut business - had my account closed down by the "bank" because they didn't want my busi…

I set up a revolut account for currency exchange in 2018 and finally moved to use them as my primary bank in 2020. Never had any significant issues. Recently I was setting up a Revolut Business account and I didn't get a notification email requesting additional evidence. Me not getting an email is something they could improve, but the need for a thorough identity verification is understandable given their global ambi…

I have been also using Revolut as my primary bank since 2017 and no issues at all. On the contrary, great customer service (I was a Metal customer and now Premium customer). Now I even do my trading through them.
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