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Do they realistically stand a chance given that what Robinhood did is technically covered by their TOS? Are we finally going to get answers on how legally bindi
by whoisburbansky 6y ago
Do they realistically stand a chance given that what Robinhood did is technically covered by their TOS? Are we finally going to get answers on how legally binding TOSses are?
- airstrike 6y agoA TOS doesn't write law
- DamnYuppie 6y agoCorrect. My very remedial understanding of law is that two parties can't enter into a legal agreement that violates existing laws or statutes.
- dalbasal 6y agoThere is no the answer, but we sure might get an answer.
- Spivak 6y agoAnd the commenters in the thread are claiming that RH is cancelling orders and trying to pretend that the cancellations were user-initiated which I think opens up a whole other bag of worms.
- offby37years 6y agoAfter eviscerating their most fervent users they are all but ruined either way. Retail is quickly learning the true cost of "commission-free" investing.
- f430 6y agolike the saying: If the product is free, YOU are the product.
- ta1234567890 6y ago> Retail is quickly learning the true cost of "commission-free" investing. But what is the alternative? Other brokers (eg TD) have done the same as Robinhood. So what is retail to do? It seems like anywhere people would attempt to do something like what’s been going on with GME, would respond in the same way as RH to the pressure of the powers that be.
- anonfornoreason 6y agofidelity and a few others are commission free, and are not placing limits on trades, and have better uptime.
- xirbeosbwo1234 6y agoNo and no. They have no case. What Robinhood did is pretty normal. Ignore the ambulance chasers.
- totalZero 6y agoI think the problem for Robinhood here is that their decision has effectively dampened the upward mobility of the stock, which hurts option holders (because IV goes down) and long holders (because the stock can't go up as much). So in a way, Robinhood is hurting all the people with existing long-delta and long-vega positions. Many of those people are Robinhood's own customers. I guess Robinhood would have to demonstrate that the position isn't suitable for its customers, or that they couldn't guarantee orderly execution under the stress of a continued barrage of orders and new customer sign-ups. This limitation definitely has an impact on GME stock, which is not good for RH because their own customers are largely the people who lose. You can put whatever you want in your TOS, but if you lose money for your own customers and one of your investors (Ken Griffin) is on the other side of the trade, then you have a huge problem on your hands.
- antonzabirko 6y agoTheir customers are hedge funds, not retail.
- totalZero 6y ago"Customer" in the legal and regulatory sense, not in terms of who actually pays for the flow.
- im3w1l 6y agoGood points. Jesus, this is such a mess.
- boublepop 6y agoYou can’t overrule laws with TOS’s.
- OliverGilan 6y agoA TOS doesn't stand up to law but also it goes beyond that. Even if you don't use Robinhood but you were holding GME you are affected by this move. It's securities fraud and market manipulation at its finest.
- notsureaboutpg 6y agoA TOS doesn't protect you from market manipulation on the scale of this and that's exactly what RH is doing.
- paulddraper 6y agoRobinhood is a brokerage. Brokerages can't manipulate markets. It's illegal.
- dudul 6y agoA TOS (or any contract, agreement, etc) cannot impose something that goes against the law.