Robinhood is raking in record cash

[tsptalk]

Here’s how Robinhood is raking in record cash on customer trades — despite making it free

Robinhood roughly doubled the money it makes from customer trades year over year, according to a recent SEC regulatory filing. The majority of that total came from options trading.

The Silicon Valley start-up attracts the highest rate of any firm for equity trades, and saw the greatest year-over-year increase in payment for order flow of any e-broker, according to the documents.

Options are far more lucrative for these trading firms, leaving some with a “huge conflict of interest,” according to Tim Welsh, founder and CEO of wealth management consulting firm Nexus Strategy.

https://www.cnbc.com/2020/08/13/how...n-customer-trades-despite-making-it-free.html

 

[Bullitt]

If people want to "day trade" that's fine. They probably won't go broke doing it and will eventually realize it's not a long term plan.

Options though, you can go broke playing around with them in a very short time.

But hey, if some hipster app can get people to save for the future instead blaming their debts on everyone else, that's a good thing. It seems Robinhood is more for the younger crowd.

While Robinhood might have more than 10 million accounts versus E-Trade’s 5.2 million and Morgan Stanley’s 3 million, E-Trade’s average account size is $69,230 and Morgan Stanley’s is $900,000, while a survey found most of Robinhood’s held $1,000 to $5,000.

https://techcrunch.com/2020/02/20/robinhood-profiles-morgan-stanley-etrade/

 

[Rod]

I keep thinking... Have the many amateurs rushing into Robinhood given any thought to setting aside a portion of their profits for short-term capital gains taxes? That is, if any of them are pocketing profits in the first place.

 

[Bullitt]

I've wondered the same thing.

I also wonder what percentage of them have ever paid taxes and what percentage of them received the $600 unemployment bonus.

 

[Bullitt]

Robintrack might be coming back.

Robinhood Considers Making Customer Trading Data Public Again

Robinhood Markets is weighing whether to restore public access to data on its customers’ trading activity after pulling it about two months ago.

“We’re looking into it,” Robinhood co-founder Vladimir Tenev said in an interview with Bloomberg reporters and editors.

Customers of the online brokerage have expressed interest in being able to monitor what their fellow investors on the platform are buying and selling in real time, and the firm is exploring its options, he said.

https://www.bloomberg.com/news/arti...ers-making-customer-trading-data-public-again