Tag: Robinhood
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Pay For Order Flow Needs To End
We are in favor of SEC Chair Gary Gensler’s proposal to route retail order flow to auction. The practice of paying for order flow has thrived since the mid 2000’s led by dark pools such as those operated by Citadel. Access to customer order flow allows Citadel, Renaissance Capital and a large number of other…
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Interactive Brokers Is The Answer To PayPal’s Retail Riddle
Should PayPal (tkr: PYPL), want to have a retail trading product, Interactive Brokers (tkr: IBKR), is the answer. IBKR is the one retail trading platform that puts technology and user security first. In our view a “technology first” trading platform that emphasizes cybersecurity should be table stakes today but unfortunately is not so among trading…
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Robinhood – Thank You May I Have Another?
Only in this Fed-driven Bizarro World equity market would a company (Robinhood, ticker: HOOD), that generates revenue by selling customer order flow be rewarded by many of those customers in the form of a 50% stock pop in one day and a 100% stock price gain in one week. The irony is thick. HOOD’s nosebleed…
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The Cryptocurrency Craze Is Driving Digital Wallet Innovation and Adoption
More than a decade after the initial Tech media buzz digital wallets are enjoying adoption largely driven by stimulus check processing and more recently the cryptocurrency craze. The pace of innovation is accelerating as digital wallets incorporate equity trade execution, cryptocurrency transaction capabilities and more. Many will know of PayPal / Venmo, Square’s Cash App,…
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The Free Trading Business Is Getting Crowded. Webull and Square Have an Edge.
Webull – the China-based fintech firm – is the latest entry in the commission-free trading space along with Robinhood, Square and Fidelity to name several. These zero commission stock trading apps have enabled the equity bubble in part. A key element of these platforms is fractional share trading which enables retail equity traders to buy…
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Consolidation Will Not Save Asset Managers
Mass Mutual and Athene made a bid for American Equity Investment Life. Activist Trian took stakes in Invesco and Janus in an effort to build one of the largest Asset Managers. M&A is a quick way to scale AUM, but it does not change the paradigm for legacy Asset Managers. Legacy Asset Managers (and depository…
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High Frequency Trading Operations Have Traded Ahead of Order Flow For Years. The Practice Stinks.
High Frequency Trading (“HFT”) operations have purchased order flow in order to trade in front of it for years. The fact that Robinhood didn’t properly disclose its practice is missing the larger issue. This practice provides HFT operations with an enormous advantage. HFT’s powerful machines glimpse order flow and execute proprietary orders that benefit from…
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The Rise of Fractional Share Trading
Robinhood (pvt.), Fidelity (pvt.), Schwab (tkr: SCHW), SoFi (pvt.) and Square (tkr: SQ) each have fractional share investment offerings. Fractional shares enable investors to purchase one U.S. Dollar’s worth of a given equity ($5 in Schwab’s case), rather than a full single share. For example, investors may purchase $1 worth of Amazon (tkr: AMZN) rather…
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