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Robinhood is such an ironic name for the app. The elephant in the room is, the people who Robinhood is supposedly letting buy into a vast money fountain that i

Robinhood is such an ironic name for the app. The elephant in the room is, the people who Robinhood is supposedly letting buy into a vast money fountain that is the stock market already had a way to get in. The fees that other brokorages were charging shouldn't have mattered if these people were investing in the only responsible way for someone who doesn't know what they're doing... and that's buying into an index fund and leaving it for several years. By it's very nature, the people who end up in Robinhood, who wouldn't be able to get "into" other brokrages, are the kinds of people who get eaten up whole by the rest of the market. It's the rich stealing even more from the poor, while giving them the illusion they're all sitting at the same table eating the same meal. - If Robinhood was really about doing what it claims to do, the app would have 3 tickers, QQQ, SPY, and DIA. And when you put money in, it'd warn you that you should be ready to leave that money there for at least 5 years. It sure as hell wouldn't have options trading.

deleted 6y ago
[deleted]
gruez 6y ago
>If Robinhood was really about doing what it claims to do, the app would have 3 tickers, QQQ, SPY, and DIA. Is that what robinhood is supposed to be? A conservative retirement savings portfolio? Sure, the app store tagline says "Invest. Save. Earn.", but the listing also mentions highly speculative instruments like cryptocurrency and derivatives. It also promises access to "real-time market data" and "relevant news articles" which is only needed when you're taking on an active management style. Clearly the app isn't designed as something you chuck money into now, and withdraw a few decades later. >By it's very nature, the people who end up in Robinhood, who wouldn't be able to get "into" other brokrages The reason why they wouldn't "get into" the other brokerages is because they transact in such small amounts that they'll lose most of their capital on trading fees. I don't see anything wrong with letting people make small trades that they wouldn't have otherwise been able to make. >And when you put money in, it'd warn you that you should be ready to leave that money there for at least 5 years. How about we let the users take personal responsibility? I like Matt Levine's idea of "Certificate of Dumb Investment". Disclose the risks to them, and let them do whatever they want. https://www.bloomberg.com/opinion/articles/2018-09-24/earning-the-right-to-get-swindled https://www.bloomberg.com/opinion/articles/2018-09-24/earnin...
- BoorishBears 6y ago
  >Is that what robinhood is supposed to be? Their idea is that they give everyone access to the financial markets, and that allows them access to wealth. My point is their name is playing on... Robin Hood who "took from the rich and gave to the needy". But in reality it's just become another way for the rich to milk people who don't have that much money to lose anyways. It completes the stated part of the mission, but completely forsakes the implied part of it. > The reason why they wouldn't "get into" the other brokerages is because they transact in such small amounts that they'll lose most of their capital on trading fees. I don't see anything wrong with letting people make small trades that they wouldn't have otherwise been able to make. My point is, they won't lose most of their capital unless they're day trading, or at least trading very aggressively. And that's wholly at odds with actually making money if you don't know what you're doing. If their goal was to create a gambling app, we already have Draft Kings... I mean, take their options trading for example. First off, the mobile app has a guided view for people who don't really get options to trade options. Ignoring the... strangeness there. It will actively recommend options that are just pure fucking insanity. So far out of the money, with such insane expiry dates, that your odds are literally worse than the lottery. And to top it off, half of them don't even have volume! So even if you do somehow start to approach any semblance of profit, you can't sell! They're so far OTM and with such low volume that they don't even make sense as "YOLO"s, they are literally recommending losing money for no reason. And it'll characterize them as "short term, high risk" when there are OTM options that are short term high risk, for marginally more money, with infinitely higher chances of profit! Why would you take someone who literally needs to be explained that puts are bearish, and show them this as the first option?! These people are told options are risky, see these incredibly stupid positions, get no mention of the Greeks, no mention of volume (it won't even show any of this unless you drill down into another view!), and take Robinhood's suggestion "I came here for risky, it says this is risky, must be what I'm looking for". > How about we let the users take personal responsibility? How on earth is that at odds with warning users they should be ready to leave their money in the stock market for long periods of time, are you daft?
BoorishBears 6y ago
I suspect part of why this comment is apparently ruffling some feathers is this idea that there's just this magical market that all the old money is guarding people away from with PDT restrictions and "accredited investor" status. I don't buy it. I believe the reason we still have accredited investors is because Uncle Sam wants to make sure you at least have 1 million dollars of assets to have liquidated if you go bust. I have never seen a truly lucrative market that consistently beats just sticking your money in an index fund that's locked away behind being Rule 501 qualified unless you literally just have millions of dollars sitting around and don't mind throwing away half a million on some high risk venture knowing it can blow up at any time. Also Robinhood is disgusting, I explain more in my other comment, but people are now coming out and saying this kid didn't even owe the money that he was shown, there's a known issue with Robinhood's handling of multi-leg options that might have bit him: https://www.reddit.com/r/wallstreetbets/comments/h97l9z/how_did_a_teenager_get_700k_in_leverage_from/fuvdbfr/ https://www.reddit.com/r/wallstreetbets/comments/h97l9z/how_... This kind of bullshit is why Robinhood is such a ridiculous proposition. It's giving someone access to a flaming ring of death, then giving them a rusted out bicycle to ride through it, and acting like you did them some great favor by letting them access the flaming ring of death because some other people in full gear on motorcycles do it all the time. Robinhood as a broker has serious flaws (I wonder if they patched the bug that let literally anyone get infinite amounts of leverage through their app?), constantly breaking during periods of high volatility, misrepresenting risk, having terrible fills for options and stocks, not showing extremely important information on options up front just to make it "easier" for people. You add all this up with who it's targeting and it's sickening. This won't be the last time this happens.

deleted 6y ago

[deleted]

gruez 6y ago

>If Robinhood was really about doing what it claims to do, the app would have 3 tickers, QQQ, SPY, and DIA. Is that what robinhood is supposed to be? A conservative retirement savings portfolio? Sure, the app store tagline says "Invest. Save. Earn.", but the listing also mentions highly speculative instruments like cryptocurrency and derivatives. It also promises access to "real-time market data" and "relevant news articles" which is only needed when you're taking on an active management style. Clearly the app isn't designed as something you chuck money into now, and withdraw a few decades later. >By it's very nature, the people who end up in Robinhood, who wouldn't be able to get "into" other brokrages The reason why they wouldn't "get into" the other brokerages is because they transact in such small amounts that they'll lose most of their capital on trading fees. I don't see anything wrong with letting people make small trades that they wouldn't have otherwise been able to make. >And when you put money in, it'd warn you that you should be ready to leave that money there for at least 5 years. How about we let the users take personal responsibility? I like Matt Levine's idea of "Certificate of Dumb Investment". Disclose the risks to them, and let them do whatever they want. https://www.bloomberg.com/opinion/articles/2018-09-24/earning-the-right-to-get-swindled https://www.bloomberg.com/opinion/articles/2018-09-24/earnin...

BoorishBears 6y ago
>Is that what robinhood is supposed to be? Their idea is that they give everyone access to the financial markets, and that allows them access to wealth. My point is their name is playing on... Robin Hood who "took from the rich and gave to the needy". But in reality it's just become another way for the rich to milk people who don't have that much money to lose anyways. It completes the stated part of the mission, but completely forsakes the implied part of it. > The reason why they wouldn't "get into" the other brokerages is because they transact in such small amounts that they'll lose most of their capital on trading fees. I don't see anything wrong with letting people make small trades that they wouldn't have otherwise been able to make. My point is, they won't lose most of their capital unless they're day trading, or at least trading very aggressively. And that's wholly at odds with actually making money if you don't know what you're doing. If their goal was to create a gambling app, we already have Draft Kings... I mean, take their options trading for example. First off, the mobile app has a guided view for people who don't really get options to trade options. Ignoring the... strangeness there. It will actively recommend options that are just pure fucking insanity. So far out of the money, with such insane expiry dates, that your odds are literally worse than the lottery. And to top it off, half of them don't even have volume! So even if you do somehow start to approach any semblance of profit, you can't sell! They're so far OTM and with such low volume that they don't even make sense as "YOLO"s, they are literally recommending losing money for no reason. And it'll characterize them as "short term, high risk" when there are OTM options that are short term high risk, for marginally more money, with infinitely higher chances of profit! Why would you take someone who literally needs to be explained that puts are bearish, and show them this as the first option?! These people are told options are risky, see these incredibly stupid positions, get no mention of the Greeks, no mention of volume (it won't even show any of this unless you drill down into another view!), and take Robinhood's suggestion "I came here for risky, it says this is risky, must be what I'm looking for". > How about we let the users take personal responsibility? How on earth is that at odds with warning users they should be ready to leave their money in the stock market for long periods of time, are you daft?

BoorishBears 6y ago

I suspect part of why this comment is apparently ruffling some feathers is this idea that there's just this magical market that all the old money is guarding people away from with PDT restrictions and "accredited investor" status. I don't buy it. I believe the reason we still have accredited investors is because Uncle Sam wants to make sure you at least have 1 million dollars of assets to have liquidated if you go bust. I have never seen a truly lucrative market that consistently beats just sticking your money in an index fund that's locked away behind being Rule 501 qualified unless you literally just have millions of dollars sitting around and don't mind throwing away half a million on some high risk venture knowing it can blow up at any time. Also Robinhood is disgusting, I explain more in my other comment, but people are now coming out and saying this kid didn't even owe the money that he was shown, there's a known issue with Robinhood's handling of multi-leg options that might have bit him: https://www.reddit.com/r/wallstreetbets/comments/h97l9z/how_did_a_teenager_get_700k_in_leverage_from/fuvdbfr/ https://www.reddit.com/r/wallstreetbets/comments/h97l9z/how_... This kind of bullshit is why Robinhood is such a ridiculous proposition. It's giving someone access to a flaming ring of death, then giving them a rusted out bicycle to ride through it, and acting like you did them some great favor by letting them access the flaming ring of death because some other people in full gear on motorcycles do it all the time. Robinhood as a broker has serious flaws (I wonder if they patched the bug that let literally anyone get infinite amounts of leverage through their app?), constantly breaking during periods of high volatility, misrepresenting risk, having terrible fills for options and stocks, not showing extremely important information on options up front just to make it "easier" for people. You add all this up with who it's targeting and it's sickening. This won't be the last time this happens.