4 ms·
Not saying you don't have a point, but there are a lot of ways to lose your ass in this world and I don't see Robinhood as a particularly egregious case that re
by fixxer 11y ago
Not saying you don't have a point, but there are a lot of ways to lose your ass in this world and I don't see Robinhood as a particularly egregious case that requires any more warning than Fidelity (which will jam fees).
Unless you have a gambling addiction, it is hard to get into trouble with a cash account. Margin accounts are another issue, but in the States, "pattern day trading" requires $25k minimum balance to execute more than 4 trades in 5 biz days. That is a pretty effective filter.
I really hope they add IRA support soon.
- ryanmonroe 11y agoJust to be clear, unless you're in the margin account beta, "free-riding" is impossible in Robinhood, so users will never be breaking any day trading rules. disclaimer: this is not legal advice http://www.finra.org/investors/day-trading-margin-requirements-know-rules http://www.finra.org/investors/day-trading-margin-requiremen... >Day trades can occur in a cash account (only) to the extent the trades do not violate the free-riding prohibition of Federal Reserve Board's Regulation T. In general, failing to pay for a security before you sell the security in a cash account violates the free-riding prohibition. If you free-ride, your broker is required to place a 90-day freeze on the account.
- fixxer 11y agoYup, agreed. For the uninitiated, this refers to your account showing a positive balance based on a sale that occurred but has not settled. Seems like a great app... just have to get some money in there without telling them my bank creds...