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Until Robinhood came along I thought transaction fee was how brokerages make money. It really was a surprise to me when these guys made it zero. I still don't u

Until Robinhood came along I thought transaction fee was how brokerages make money. It really was a surprise to me when these guys made it zero. I still don't understand how they make money though. On a different note, I don't think they are in anyway different from the other brokerages, the only reason these guys became popular is because of the zero transaction fee trick. It was a good one but there might not be more tricks left for new entrants. The software is written from scratch in 2018/19 so obviously it will take the shape of that time, nothing great about that.

ttymck 6y ago
> I still don't understand how they make money I implore you to look into it [1] [1] https://fortune.com/2020/07/08/robinhood-makes-millions-selling-your-stock-trades-is-that-so-wrong/ https://fortune.com/2020/07/08/robinhood-makes-millions-sell...
dilyevsky 6y ago
Same way other brokers have been making money in addition to fees - sell order flow, margin, etc
thiscatis 6y ago
Have a look at https://www.investopedia.com/articles/active-trading/020515/how-robinhood-makes-money.asp https://www.investopedia.com/articles/active-trading/020515/... My bet is that this is also why they abandoned their EU plans as most of these practices are illegal / more strictly regulated.