5 ms·

That's not what I'm asking about. They specifically said trading desks at banks, Citadel is a market maker. But what's really you're just parroting baseless co

That's not what I'm asking about. They specifically said trading desks at banks, Citadel is a market maker. But what's really you're just parroting baseless conspiracy -- Citadel is a legitimate business which provides a great service to Robin Hood users. Payment for order flow is very good for the retail investor, reducing commissions and improving prices, the recent episode of Bloomberg's Odd Lots podcast with Doug Cifu went explained exactly how this works, it's a classic example of incentives aligning. Also by design no market maker gets access to all Robinhood transactions.

finikytou 5y ago
sure. they dont get access to all robinhood transactions. their trading algorithms do the work. if you know a few ms in advance the trades you can literaly make money out of it. and this should be clearly advertised when getting into robinhood. Your argument that it is to help retail traders to enter for cheap into trading is fallacious. It is exactly like saying getting into real estate nowadays is a no brainer due to low interest loans. even tho the loan means borrowing money for 30years and living like a slave to pay a rent that the generation before you got in 10years. In the same ways FB makes money out of people Citadel and Robinhood does it 0 conspiracy there
- bidirectional 5y ago
  It's nothing to do with knowing the trades 'in advance', they're the ones doing the trades! Market makers like Citadel are regulated to improve the prices offered in the market place. A stock may trade for $50 on the exchange, but Citadel can sell it for $49.50, they must improve prices and they do. Part of the reason they can do this is that Robin Hood orders are 'safe'. If a huge hedge fund comes to Citadel and wants to trade a million shares in TSLA, they likely know something Citadel doesn't and will rip their face off. That's why Robin Hood orders are valuable, luckily, the incentives of the retail investor (buying a stock as cheap as possible) and the market maker (selling to someone who isn't about to pummel them) line up. If you think Citadel and its ilk are bad, you should see the guys they replaced! Market making is as old as the market itself, the modern advancements allow commission-free trading, massive liquidity and tiny spreads, before you'd be paying commission and buying a stock for dollars more than you could sell it for. They're good for the market and it's a shame this crazy conspiratorial thinking (which is never backed up by any real understanding) has taken hold of so many people.
- finikytou 5y ago
  You re right. they do the trades for robinhood users. What do you think they do between the time they receive the order and execute it? don't forget that the default trade on robinhood has no limit to it. you buying market value. now try doing that on millions of users just like madoff did playing with the cents.
  - bidirectional 5y ago
    They make their cents (or less) on the bid-ask spread, as do all market makers. They do this while also improving the execution of the trade for the end user. Some of that spread goes back to Robin Hood via PFOF. Citadel allows people to buy stocks for less than they would normally, this is an irrefutable fact. What do you think they're doing in that time? Please be specific because I have no idea what part of this mutually beneficial, standard operating procedure is meant to be a criminal conspiracy. The people losing out are institutional investors who cannot access the same execution quality as a retail investor, because they trade in greater volume and are more likely to be behind a market move.

finikytou 5y ago

sure. they dont get access to all robinhood transactions. their trading algorithms do the work. if you know a few ms in advance the trades you can literaly make money out of it. and this should be clearly advertised when getting into robinhood. Your argument that it is to help retail traders to enter for cheap into trading is fallacious. It is exactly like saying getting into real estate nowadays is a no brainer due to low interest loans. even tho the loan means borrowing money for 30years and living like a slave to pay a rent that the generation before you got in 10years. In the same ways FB makes money out of people Citadel and Robinhood does it 0 conspiracy there

bidirectional 5y ago
It's nothing to do with knowing the trades 'in advance', they're the ones doing the trades! Market makers like Citadel are regulated to improve the prices offered in the market place. A stock may trade for $50 on the exchange, but Citadel can sell it for $49.50, they must improve prices and they do. Part of the reason they can do this is that Robin Hood orders are 'safe'. If a huge hedge fund comes to Citadel and wants to trade a million shares in TSLA, they likely know something Citadel doesn't and will rip their face off. That's why Robin Hood orders are valuable, luckily, the incentives of the retail investor (buying a stock as cheap as possible) and the market maker (selling to someone who isn't about to pummel them) line up. If you think Citadel and its ilk are bad, you should see the guys they replaced! Market making is as old as the market itself, the modern advancements allow commission-free trading, massive liquidity and tiny spreads, before you'd be paying commission and buying a stock for dollars more than you could sell it for. They're good for the market and it's a shame this crazy conspiratorial thinking (which is never backed up by any real understanding) has taken hold of so many people.
finikytou 5y ago
You re right. they do the trades for robinhood users. What do you think they do between the time they receive the order and execute it? don't forget that the default trade on robinhood has no limit to it. you buying market value. now try doing that on millions of users just like madoff did playing with the cents.
- bidirectional 5y ago
  They make their cents (or less) on the bid-ask spread, as do all market makers. They do this while also improving the execution of the trade for the end user. Some of that spread goes back to Robin Hood via PFOF. Citadel allows people to buy stocks for less than they would normally, this is an irrefutable fact. What do you think they're doing in that time? Please be specific because I have no idea what part of this mutually beneficial, standard operating procedure is meant to be a criminal conspiracy. The people losing out are institutional investors who cannot access the same execution quality as a retail investor, because they trade in greater volume and are more likely to be behind a market move.