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Hmm, I'm assuming this is illegal (otherwise someone would likely be doing it) but why doesn't a high frequency trading firm make a competing application and ju

by pg_bot 8y ago

Hmm, I'm assuming this is illegal (otherwise someone would likely be doing it) but why doesn't a high frequency trading firm make a competing application and just keep that order flow for themselves? Why not vertically integrate?

kasey_junk 8y ago
Because retail sucks & their core competencies have nothing to do with dealing with customers.
- tptacek 8y ago
  Seriously you'd think on a board ostensibly obsessed with CAC and ARPU metrics, it would be immediately obvious why a specialty player wouldn't want to compete with Schwab and Fidelity.
  - pg_bot 8y ago
    Multiple players along the chain could decide to vertically integrate. Although I used the example of high frequency traders, a better question which I should have asked is why hasn't someone dipped their toes into retail and HFT? It seems like someone would want to grab that land for themselves if it were particularly valuable, which the valuation of Robinhood purports. Considering some guys in that industry made this app, I don't think it's too far a stretch of the imagination for someone to believe that an industry player could have made that move.
    - physguy1123 8y ago
      If you're an HFT, you would much rather just pay for the order flow and not deal with all the shit that is retail (government, customers, all that shit). If you're some big retail firm, you're probably run by suits, way to beauracratic to run a difficult high-tech trading team, and any talent you got would get siphoned off to a good trading firm.
      - vasilipupkin 8y ago
        different competencies. Acquiring retail customers is very hard and is not something HFT firms have any special competency in.
hendzen 8y ago
ETrade actually had an in-house proprietary trading unit that was making so much money that they sold it off because the regulators were asking questions. https://www.bloomberg.com/news/articles/2013-10-23/e-trade-sells-market-making-unit-to-susquehanna-for-75-million https://www.bloomberg.com/news/articles/2013-10-23/e-trade-s...

by pg_bot 8y ago

kasey_junk 8y ago

Because retail sucks & their core competencies have nothing to do with dealing with customers.

tptacek 8y ago
Seriously you'd think on a board ostensibly obsessed with CAC and ARPU metrics, it would be immediately obvious why a specialty player wouldn't want to compete with Schwab and Fidelity.
- pg_bot 8y ago
  Multiple players along the chain could decide to vertically integrate. Although I used the example of high frequency traders, a better question which I should have asked is why hasn't someone dipped their toes into retail and HFT? It seems like someone would want to grab that land for themselves if it were particularly valuable, which the valuation of Robinhood purports. Considering some guys in that industry made this app, I don't think it's too far a stretch of the imagination for someone to believe that an industry player could have made that move.
  - physguy1123 8y ago
    If you're an HFT, you would much rather just pay for the order flow and not deal with all the shit that is retail (government, customers, all that shit). If you're some big retail firm, you're probably run by suits, way to beauracratic to run a difficult high-tech trading team, and any talent you got would get siphoned off to a good trading firm.
    - vasilipupkin 8y ago
      different competencies. Acquiring retail customers is very hard and is not something HFT firms have any special competency in.

hendzen 8y ago

ETrade actually had an in-house proprietary trading unit that was making so much money that they sold it off because the regulators were asking questions. https://www.bloomberg.com/news/articles/2013-10-23/e-trade-sells-market-making-unit-to-susquehanna-for-75-million https://www.bloomberg.com/news/articles/2013-10-23/e-trade-s...