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Could you expand on what the risk to Robinhood is here? From what I understand, users purchased stock for money. What is Robinhood holding here that can create
by leesalminen 6y ago
Could you expand on what the risk to Robinhood is here? From what I understand, users purchased stock for money. What is Robinhood holding here that can create risk for them?
- freeone3000 6y agoSome users purchased stock for money. Others purchased the right to buy stock later. Still others trade on margin, or, borrowed money. Robinhood offers all three, and it's not clear which this is, since it conflates the first and the third in the UI.
- leesalminen 6y agoAhhh, I see, understood. If RH (or any brokerage) tried to sell shares of stock I owned outright (i.e. exchanged USD for a share at market price) I would be livid. But it sounds like this article is maybe overblown. Thanks for the clarification!
- AngryData 6y agoThe company that owns Robinhood is the same company that was shorting all the GME stocks.
- leesalminen 6y agoRight, I’m aware. I don’t think that’s a valid defense for what RH did today and was curious to hear if others thought there was a valid defense. If RH is just calling in open margin orders, then that’s just the game. If RH is selling outright owned securities, that’s wrong.
- detaro 6y agoI was primarily commenting on the framing. The RH message never pretends it isn't acting in RHs interest, so the representing it as a "we knows what best for you" doesn't make sense. I don't know if it's only about shares on margin or how the process exactly works behind to judge if there actually is a threat to RH or not.