41–50 of 137 posts
People who buy and sell stock on Robinhood don't pay them anything, it's the market makers that pay them.
In this case, the adage is true "You're not the customer, you're the product"...
I don't understand how they can blame capital requirements and potentially having to cover customers' losses (that was Interactive Brokers) for stopping purchases of the stock. Unless you're talking about buying on margin, there's no risk that you'd have to absorb any loss for someone who just buys a share of the stock through you with their own cash.
>Unless you're talking about buying on margin I can assure you, there was a lot of margin purchases happening.
I'm sure many people are buying on leverage, but that doesn't explain why they can't just limit margin buying vs preventing any purchase of the stock.
What does "limited" even mean?! It's already limited to hedge funds.
Likely no margin at all. Maybe even to the point of cash needing to clear into your account (from previous trades/ACH transfers) before you can buy these stocks. Maybe limits/ban on selling of options where the loss can be unlimited (as opposed to buying where the limit is the option's contract price).
We're in a bubble that's being used instrumentally in a game of chicken between average joe with RH account and hedge funds on their short positions. There's more to gain from this because of the social aspect (social change and reform), but also more to lose (bubble bursting on the average citizen that has more to lose personally than a fund). I'm obviously not cheering for the funds here, but I do worry for people…
I’m gonna disagree. The entire “social movement” seems to be little more than the same tired old cliches and hysterics about “speculators”.
The main grievance is basically that short selling is bad. Despite academic finance, finding again and again that short selling meaningfully improves price efficiency and protects ordinary investors from bubbles and mania.[1][2]
Again and again corporate executives use the scapegoat of short sellers and speculators to shift the blame from their own mismanagement. GameStop is no different, and it’s certainly not the short sellers that caused it to have a dying business model that’s hemorrhaging money.
[1]https://www.sciencedirect.com/science/article/abs/pii/S03784... [2] https://academic.oup.com/rfs/article-abstract/24/3/821/15904...
Too little too late as far as brand reputation. Feels like #DeleteUber on steroids.
Mark my words - Robinhood is going to be fine and it will have negligible impact. They have a strong product and better than anyone else in the market as a mobile app.
RHs told it's users 'you are our product. Do as you are told.'
People are not as stupid as they're made out to be and they have some self respect and dignity.
RH has mortally wounded itself.
I don't understand how they can blame capital requirements and potentially having to cover customers' losses (that was Interactive Brokers) for stopping purchases of the stock. Unless you're talking about buying on margin, there's no risk that you'd have to absorb any loss for someone who just buys a share of the stock through you with their own cash.
>Unless you're talking about buying on margin I can assure you, there was a lot of margin purchases happening.
If it was decided that most people could only sell stock, not buy it - who exactly is buying the stock?