Robinhood stock trading app confirms $110M raise at $1.3B valuation

Re:Robinhood stock trading app confirms $110M raise at $1.3B... by scott00 on Wednesday April 26, 2017 @12:22PM (#14204404)

There aren't actually any transactions fees to absorb. Wholesale brokers (think Citadel) pay retail brokers (think Robin Hood) for the privilege of executing their orders.

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Re:Robinhood stock trading app confirms $110M raise at $1.3B... by cturner on Wednesday April 26, 2017 @12:41PM (#14204623)

I found 'RHF SEC Rule 606 and 607 Disclosure' on their disclosures page. https://www.robinhood.com/legal/

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Re:Robinhood stock trading app confirms $110M raise at $1.3B... by hn9780470248775 on Thursday April 27, 2017 @01:11AM (#14209326)

Why?

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Re:Robinhood stock trading app confirms $110M raise at $1.3B... by scott00 on Friday April 28, 2017 @11:30AM (#14220201)

Because, for the most part, retail investors are not well-informed investors and are willing to cross the bid-ask spread. To simplify dramatically, suppose Citadel thinks the fair value of a stock is 25.185, the market is 25.18-25.19, and a Robin Hood customer wants to pay 25.19 to buy 1 share of the stock. If they buy from Citadel, Citadel makes $0.0050 on average. Given those basic economics, it makes sense for Citadel to pay, say $0.0018, to make sure that the Robin Hood customer buys from them instead of from Knight.

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