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Robinhood sells their order flow to Citadel. Citadel is financing Melvin Capital's GME short. The financing terms are private but whether they just lent them f
by ucha 6y ago
Robinhood sells their order flow to Citadel.
Citadel is financing Melvin Capital's GME short. The financing terms are private but whether they just lent them funds to cover the margin calls or actually hold their short positions until the storm passes for a fee, it is absolutely in their interest to prevent GME from continuing to skyrocket. Drawing a collusion between Citadel and RH isn't that far-fetched but I obviously have no insider knowledge of this.
Most brokerages sell their order flow and Citadel trades 25% of the equities market in the US, from memory. Schwab, which also sells order flow to Citadel, requires 200% margin to go long GME which makes no sense since at most, you can lose 100% of your bet.
This is not what free markets are supposed to be like.
- shakezula 6y agoBecause it’s not a free market. It’s a controlled market where market makers have all the power and they plainly flex it. I’m pretty disgusted with this as a whole. As others have pointed out in this thread, these funds have no problem margin calling the little guy but when they get in danger of losing their ass they can just bail out and hit the “off” button on the whole stock? Complete bullshit honestly.