An Update from Robinhood’s Founders

Re:An Update from Robinhood’s Founders by throway9812 on Tuesday March 03, 2020 @11:34PM (#22481230)

This is absolutely not true. Broker-dealers and brokerages routinely credit clients for execution out of line with the market. Schwab does in fact give price adjustments for slowly or incorrectly handled orders.

The reason nobody will be compensated here is due to two things,

(1) There is no way to determine what a fair execution would have been, since clients couldn't submit orders in the first place.

(2) Clients will adversely select their losing trades for corrections and this would bankrupt Robinhood in about five minutes.

Source: work at a wholesaler.

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Re:An Update from Robinhood’s Founders by vel0city on Wednesday March 04, 2020 @12:43AM (#22481473)

I mean, you say its "absolutely not true" and yet that's literally verbatim from their Brokerage Account Agreement.

https://www.schwab.com/public/schwab/nn/agreements/schwab_br...

Maybe in some cases they go above and beyond their account agreement if they like you as a customer, but according to the agreement you sign with them its not their problem if things go bad in this way.

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Re:An Update from Robinhood’s Founders by yesiamyourdad on Wednesday March 04, 2020 @02:21AM (#22481821)

> There is no way to determine what a fair execution would have been, since clients couldn't submit orders in the first place.

On the flip side, clients have no guarantee that there would have been a counterparty for their order.

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