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MM is different from RH. RH would actually need to get collateral (or raise money) to allow its customers to trade GME at this volatility. I really think the an
by hehehaha 6y ago
MM is different from RH. RH would actually need to get collateral (or raise money) to allow its customers to trade GME at this volatility. I really think the anger should be directed at Wall Street and the Fed for creating a frothy investment environment and not doing anything about it. RH OTOH is trying to be a disruptive player.
- socialist_coder 6y agoI understand that RH is not a MM. So then why does RH have to manage its risk from the holdings of it's own customers? I am not a finance professional but I thought RH is just like a custodian and facilitator of trades. It's not on the other side of any of these trades. It never holds any positions. Why does it have to manage its risk and why does a GME event create extra risk for RH? I thought this kind of risk is only for the MM's like Citadel.
- socialist_coder 6y agoI think this explains it: https://news.ycombinator.com/item?id=25951475 https://news.ycombinator.com/item?id=25951475