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Citadel allegedly reloaded Shorts on GME before Robinhood put restrictions

165 points by vthallam 6y ago

bhouston 6y ago
If I learned anything from watching Billions is that the fix is usually in and it is between the guys with lots and lots of money. What an amazing inside trade -- knowing or forcing the Robinhood App to restrict the large majority of WallStreetBets from buying, and then shorting the hell out of it. And they will probably get away with it too, which I also learned from watching Billions.
- airstrike 6y ago
  > learned from watching Billions You know, it's a TV show, not a graduate level course on capital markets.
  - platty 6y ago
    Have you seen the production quality though?
  - imstate 6y ago
    It's not a documentary?
  - boublepop 6y ago
    While it’s true that it’s a TV show, one of the aspects that makes it interesting is that the many immoral and self serving actions taken by the two main characters are often inspired by real life controversies or cases of financial crime or political corruption. With an attempt at splitting them into the two camps of “corruption outside the system” and “corruption within the system” personified by the two feuding main characters.
  - bhouston 6y ago
    I think a lot of it is how things are. Of course a lot of it is over the top for dramatic purposes and everything in the show happens to the same set of characters as is needed in a drama... But the fundamentals I think are spot on.
- engineeringwoke 6y ago
  Absolutely not, this is fucking insane. Ken Griffin is going to jail.
- jinonoel 6y ago
  I can't wait for inevitable Billions episode about Gamestop. Dollar Bill is probably going to lose it :)
ackbar03 6y ago
There might be another layer to this story. Citadel securities is one of the major market makers that handles orders for Robin hood. I'm guessing they most likely were given a heads up. Granted the hedge fund is separate from the market making business but who knows right
- nceqs3 6y ago
  Yeah even if one POD at Citadel (hedge fund segment) was short GME or increased GME short before Robinhood GME stop there will be many fingers pointed.
vthallam 6y ago
If you think about it, they basically stopped buying for the top 4 most mentioned stocks on WSB - https://stonks.news/wsb/summary/ https://stonks.news/wsb/summary/
reducesuffering 6y ago
How about confirming your "tip" is true before further inflaming people with rhetoric about jail and warfare?
- Lionga 6y ago
  Justin mentions it is a tip and puts his reputation on the line to get the news out. How about having some balls to put your name on what you believe to be true?
  - reducesuffering 6y ago
    Apparently his reputation is shot. His "news" is disinformation. https://blog.robinhood.com/news/2021/1/28/an-update-on-market-volatility https://blog.robinhood.com/news/2021/1/28/an-update-on-marke...
- socialist_coder 6y ago
  It is class warfare though... Only the elites are allowed to win here. How else can you describe that other than class warfare?
  - LatteLazy 6y ago
    Only if it's true. Right now it's some guy on twitter quoting his unnamed friend...
    - socialist_coder 6y ago
      Halting buy orders on stocks that the Wall Street powerhouses are betting will go down seems like enough for me... Refueling your shorts is the icing on the cake.
      - LatteLazy 6y ago
        I agree about halting stock orders. That's dodgy as fuck. As for re-shorting, my issue is there is no evidence of that so far. The fact its "some guy on twitter's anon mate" makes me think it's total bs.
wocram 6y ago
Citadel should not be able to prevent Robinhood from trading $GME. Robinhood routes trades to many other counterparties, detailed here: https://cdn.robinhood.com/assets/robinhood/legal/RHS%20SEC%20Rule%20606a%20and%20607%20Disclosure%20Report%20Q3%202020.pdf https://cdn.robinhood.com/assets/robinhood/legal/RHS%20SEC%2... from https://robinhood.com/us/en/about/legal/ https://robinhood.com/us/en/about/legal/
Arubis 6y ago
[Citations needed.] This would be significant, important news if true. Without confirmation, it's just fanning the flames.
paulmd 6y ago
while I have some sympathy for the "letting retail traders coordinate to cause havoc in the market probably isn't the best thing" argument... lol fuck these guys, this apparently couldn't have happened to nicer people
reducesuffering 6y ago
Justin's "tip" was incorrect and he's spreading disinformation. "To be clear, this was a risk-management decision, and was not made on the direction of the market makers we route to." - Robinhood[0] [0]https://blog.robinhood.com/news/2021/1/28/an-update-on-market-volatility https://blog.robinhood.com/news/2021/1/28/an-update-on-marke...
- p_j_w 6y ago
  Unless there's some transparency and investigation of the matter, it's harder to believe than it is for them to say it.
  - reducesuffering 6y ago
    There will be investigation undoubtedly. So who's got more skin in the game? Is it Robinhood with an official press release stating their decision didn't come from their market-maker, Citadel, and if this isn't true would face repercussions in court? Or is it Justin, who like the rest of twitter-verse, if wrong, faces zero repercussions?

165 points by vthallam 6y ago

If I learned anything from watching Billions is that the fix is usually in and it is between the guys with lots and lots of money. What an amazing inside trade -- knowing or forcing the Robinhood App to restrict the large majority of WallStreetBets from buying, and then shorting the hell out of it. And they will probably get away with it too, which I also learned from watching Billions.

airstrike 6y ago
> learned from watching Billions You know, it's a TV show, not a graduate level course on capital markets.
- platty 6y ago
  Have you seen the production quality though?
- imstate 6y ago
  It's not a documentary?
- boublepop 6y ago
  While it’s true that it’s a TV show, one of the aspects that makes it interesting is that the many immoral and self serving actions taken by the two main characters are often inspired by real life controversies or cases of financial crime or political corruption. With an attempt at splitting them into the two camps of “corruption outside the system” and “corruption within the system” personified by the two feuding main characters.
- bhouston 6y ago
  I think a lot of it is how things are. Of course a lot of it is over the top for dramatic purposes and everything in the show happens to the same set of characters as is needed in a drama... But the fundamentals I think are spot on.
engineeringwoke 6y ago
Absolutely not, this is fucking insane. Ken Griffin is going to jail.
jinonoel 6y ago
I can't wait for inevitable Billions episode about Gamestop. Dollar Bill is probably going to lose it :)

ackbar03 6y ago

There might be another layer to this story. Citadel securities is one of the major market makers that handles orders for Robin hood. I'm guessing they most likely were given a heads up. Granted the hedge fund is separate from the market making business but who knows right

nceqs3 6y ago
Yeah even if one POD at Citadel (hedge fund segment) was short GME or increased GME short before Robinhood GME stop there will be many fingers pointed.

vthallam 6y ago

If you think about it, they basically stopped buying for the top 4 most mentioned stocks on WSB - https://stonks.news/wsb/summary/ https://stonks.news/wsb/summary/

reducesuffering 6y ago

How about confirming your "tip" is true before further inflaming people with rhetoric about jail and warfare?

Lionga 6y ago
Justin mentions it is a tip and puts his reputation on the line to get the news out. How about having some balls to put your name on what you believe to be true?
- reducesuffering 6y ago
  Apparently his reputation is shot. His "news" is disinformation. https://blog.robinhood.com/news/2021/1/28/an-update-on-market-volatility https://blog.robinhood.com/news/2021/1/28/an-update-on-marke...
socialist_coder 6y ago
It is class warfare though... Only the elites are allowed to win here. How else can you describe that other than class warfare?
- LatteLazy 6y ago
  Only if it's true. Right now it's some guy on twitter quoting his unnamed friend...
  - socialist_coder 6y ago
    Halting buy orders on stocks that the Wall Street powerhouses are betting will go down seems like enough for me... Refueling your shorts is the icing on the cake.
    - LatteLazy 6y ago
      I agree about halting stock orders. That's dodgy as fuck. As for re-shorting, my issue is there is no evidence of that so far. The fact its "some guy on twitter's anon mate" makes me think it's total bs.

wocram 6y ago

Citadel should not be able to prevent Robinhood from trading $GME. Robinhood routes trades to many other counterparties, detailed here: https://cdn.robinhood.com/assets/robinhood/legal/RHS%20SEC%20Rule%20606a%20and%20607%20Disclosure%20Report%20Q3%202020.pdf https://cdn.robinhood.com/assets/robinhood/legal/RHS%20SEC%2... from https://robinhood.com/us/en/about/legal/ https://robinhood.com/us/en/about/legal/

Arubis 6y ago

[Citations needed.] This would be significant, important news if true. Without confirmation, it's just fanning the flames.

paulmd 6y ago

while I have some sympathy for the "letting retail traders coordinate to cause havoc in the market probably isn't the best thing" argument... lol fuck these guys, this apparently couldn't have happened to nicer people

reducesuffering 6y ago

Justin's "tip" was incorrect and he's spreading disinformation. "To be clear, this was a risk-management decision, and was not made on the direction of the market makers we route to." - Robinhood[0] [0]https://blog.robinhood.com/news/2021/1/28/an-update-on-market-volatility https://blog.robinhood.com/news/2021/1/28/an-update-on-marke...

p_j_w 6y ago
Unless there's some transparency and investigation of the matter, it's harder to believe than it is for them to say it.
- reducesuffering 6y ago
  There will be investigation undoubtedly. So who's got more skin in the game? Is it Robinhood with an official press release stating their decision didn't come from their market-maker, Citadel, and if this isn't true would face repercussions in court? Or is it Justin, who like the rest of twitter-verse, if wrong, faces zero repercussions?