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I've spent most of the last decade making fun of Robinhood, but their expansion to new markets, and user experiences, have been a force of change that I must co
by vmception 6y ago
I've spent most of the last decade making fun of Robinhood, but their expansion to new markets, and user experiences, have been a force of change that I must commend!
I can gladly sell my order flow for in exchange for a more efficient and liquid options market with no commissions, it makes many more theoretical strategies much more viable, and allows for risk management possibilities I could only dream of. The liquidity of course comes from Robinhood users and I rarely use Robinhood myself, but my preferred platforms do charge for options contracts, so there is a use case for some activity on Robinhood if I use many contracts.
The way they monetize user data as a primary business model is novel for a brokerage firm, and very similar to adtech and big tech but with just a few much more lucrative clients that would probably pay even more than they already do for that edge. At the same time, selling client order flow in a nice easy package is probably the only data brokering that seems fair and will survive regulatory scrutiny when user data-property rights gain legislative foothold.