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1. Robinhood accounts are all margin by default. Most novice investors don't know the difference. They should, but I would wager Robinhood doesn't spend a lot o
by forbiddenvoid 6y ago
1. Robinhood accounts are all margin by default. Most novice investors don't know the difference. They should, but I would wager Robinhood doesn't spend a lot of time educating people about this.
2. Long positions (buying and holding stock) aren't leveraged. There is no capital risk to holding a stock. If the sales of GME are entirely based on other positions being underwater, then sure, but it seems at least some of the examples provided aren't in that situation.
- matwood 6y agoI thought RH only allowed margin if you paid the monthly fee? Or, are you talking about margin for purposes of settling so you can trade again before a sale is fully settled?
- jquery 6y ago> There is no capital risk to holding a stock. A broker can change margin maintenance requirements at any time, including for shares bought with margin. When using margin, a broker has wide latitude to liquidate positions of the account using margin.
- adrr 6y agohttps://robinhood.com/us/en/support/articles/upgrading-to-gold/ https://robinhood.com/us/en/support/articles/upgrading-to-go... Robinhood let’s you borrow money to buy stocks. If you borrow $10k to buy GME at $300 and it dropped to $100. There’s a risk to RH that you won’t be able to payback the loan. RH most likely will liquidate the position before it even hits $100 to mitigate the risk on the loan depending how leveraged you are.