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I increasingly distrust it is just a collateral requirement issue from RH side. They have multiple venues to borrow if it is conventional collateral requirement
by liuliu 6y ago
I increasingly distrust it is just a collateral requirement issue from RH side. They have multiple venues to borrow if it is conventional collateral requirements for settlements, and money market barely moved yesterday (no substantial borrowing).
It is definitely possible that they were insolvent for a moment yesterday, but most likely due to wrong risk management on other parts (margins etc) of the company.
- JumpCrisscross 6y ago> have multiple venues to borrow if it is conventional collateral requirements for settlements Collateral requirements have taken down brokerages far bigger than Robinhood. > money market barely moved yesterday (no substantial borrowing) Robinhood borrowing its entire market cap fifty times over wouldn't move the money markets. The U.S.-dollar money markets are trillions of dollars deep and global in scale. (To say nothing of the unusually-liquid times we're in.)
- valuearb 6y agoRobinhood is thinly capitalized, insolvency has never been far away.