5 ms·

From what you describe, brokers are protecting the retail investor? Awesome, I can feel free to make any speculative decision and they will protect me from mys

From what you describe, brokers are protecting the retail investor? Awesome, I can feel free to make any speculative decision and they will protect me from myself if it goes south. Where can I sign up to one of these brokers that guarantee I am safe? I disagree with your assessment, these brokers are preventing purchases of these stock, there is no risk for the broker in this regard.

slg 6y ago
These companies are still businesses. They won't care if you, a single retail investor, screw up and lose a lot of money. However it is dangerous for the future health of their business if a sizable portion of their retail investors take a bath on this, get turned off by that experience, and end up stop using the service.
- HappySweeney 6y ago
  How will those investors feel when they are paternalistically told the trade they want to make is too risky, and then end up losing out on 3x gains as a result?
  - llampx 6y ago
    Let's not beat around the bush, RH doesn't care about it's users, it cares about it's clients. Including Citadel, who has a LOT to lose if all the options are ITM tomorrow.
- imtringued 6y ago
  You aren't thinking straight. Millions of people bought GME for a single reason and Robinhood denied them that reason. If anything this is going to piss them off even more. I don't even have a Robinhood account and it is now guaranteed that I will never use Robinhood in my entire life because they are total scumbags.
  - slg 6y ago
    Those people might be angrier at this specific moment, but I don't think that will last long. Losing real money currently in your possession is always going to be more painful than losing out on future earnings that were always theoretical. Once GME drops back down to some normal levels, which is only a matter of time, the anger of restricting trades will fade. The anger from people who lost a lot won't fade as easily. I don't have a Robinhood account either. They are plenty of reasons why I would avoid doing business with that company. I still don't think this is as bad a business move as some people here are claiming.
BoorishBears 6y ago
Brokers are covering their asses. You're projecting a positive spin on this when I literally said "this is actively hurting investors" - Something insane is happening, claims of market manipulation are flying, Congress is saying they're going to investigate, what started as a meme is suddenly picking up more daily volume than SPY... There's going to be a bloodbath, and their options are: - do absolutely nothing, watch people get slaughtered. This is what they normally do! - start removing yourself from the blast radius and pop the bubble, watch people get slaughtered. The second case still hurts people, it's not some benevolent thing they're doing! They're doing it because it covers their asses a bit. Because this time with all the tricky stuff happening with claims of manipulation, the insane volatility, the insane publicity, and most importantly the insane volume, they're afraid they might be opening themselves up to some sort of liability. sec.gov/rules/other/2013/34-69013.pdf Broker-dealers aren't supposed to hold your hand, but there is guidance that they should provide some meaningful sort of hand rails for retail investors. Usually they make money either way and sit back, but this time the same way the masses have been concentrated at a stock ticker, the masses (and Congress) could end up concentrated at their door step asking why they let this happen... They'd rather have AOC threatening to ask why a stock that's been spiked %1,400 in a month was deemed too high volatility for clients than the SEC asking why they let so many people take a bath on a meme gone wild...

slg 6y ago

These companies are still businesses. They won't care if you, a single retail investor, screw up and lose a lot of money. However it is dangerous for the future health of their business if a sizable portion of their retail investors take a bath on this, get turned off by that experience, and end up stop using the service.

HappySweeney 6y ago
How will those investors feel when they are paternalistically told the trade they want to make is too risky, and then end up losing out on 3x gains as a result?
- llampx 6y ago
  Let's not beat around the bush, RH doesn't care about it's users, it cares about it's clients. Including Citadel, who has a LOT to lose if all the options are ITM tomorrow.
imtringued 6y ago
You aren't thinking straight. Millions of people bought GME for a single reason and Robinhood denied them that reason. If anything this is going to piss them off even more. I don't even have a Robinhood account and it is now guaranteed that I will never use Robinhood in my entire life because they are total scumbags.
- slg 6y ago
  Those people might be angrier at this specific moment, but I don't think that will last long. Losing real money currently in your possession is always going to be more painful than losing out on future earnings that were always theoretical. Once GME drops back down to some normal levels, which is only a matter of time, the anger of restricting trades will fade. The anger from people who lost a lot won't fade as easily. I don't have a Robinhood account either. They are plenty of reasons why I would avoid doing business with that company. I still don't think this is as bad a business move as some people here are claiming.

BoorishBears 6y ago

Brokers are covering their asses. You're projecting a positive spin on this when I literally said "this is actively hurting investors" - Something insane is happening, claims of market manipulation are flying, Congress is saying they're going to investigate, what started as a meme is suddenly picking up more daily volume than SPY... There's going to be a bloodbath, and their options are: - do absolutely nothing, watch people get slaughtered. This is what they normally do! - start removing yourself from the blast radius and pop the bubble, watch people get slaughtered. The second case still hurts people, it's not some benevolent thing they're doing! They're doing it because it covers their asses a bit. Because this time with all the tricky stuff happening with claims of manipulation, the insane volatility, the insane publicity, and most importantly the insane volume, they're afraid they might be opening themselves up to some sort of liability. sec.gov/rules/other/2013/34-69013.pdf Broker-dealers aren't supposed to hold your hand, but there is guidance that they should provide some meaningful sort of hand rails for retail investors. Usually they make money either way and sit back, but this time the same way the masses have been concentrated at a stock ticker, the masses (and Congress) could end up concentrated at their door step asking why they let this happen... They'd rather have AOC threatening to ask why a stock that's been spiked %1,400 in a month was deemed too high volatility for clients than the SEC asking why they let so many people take a bath on a meme gone wild...