Re:Robinhood is limiting purchases of stocks: AMC, Blackberr...
by tylerhou on Thursday January 28, 2021 @12:49PM
(#25945635)
Yes, Robinhood disclosed that Citadel's MM desk accounted for the largest portion of their payment for order flow income in their rule 606 disclosures. But still a bad take because Citadel stands to make much more money on further trading, and Citadel's hedge fund likely has the capital to outlast retail.
https://cdn.robinhood.com/assets/robinhood/legal/RHS%20SEC%2...
Re:Robinhood is limiting purchases of stocks: AMC, Blackberr...
by JumpCrisscross on Thursday January 28, 2021 @12:52PM
(#25945697)
Let me be clear: if I were sales at Robinhood, Citadel MM is a huge client.
But Citadel MM is more likely to pull the plug on making markets in a name for risk reasons than to benefit a hedge fund position. To say nothing of the fact that Citadel got to bail out Melvin Capital, which is traditionally a profitable trade.
Re:Robinhood is limiting purchases of stocks: AMC, Blackberr...
by tylerhou on Thursday January 28, 2021 @12:55PM
(#25945746)
I am agreeing with you that there is not much merit to a conspiracy that Citadel asked Robinhood to pull out.
In particular, I believe Citadel would gain more from continued trading on Robinhood than they would lose from their hedge fund positions.
I'm seeing one tweet from Adam Hackney claiming this [1]. Do we have a real source?
[1] https://twitter.com/mindmeld_me/status/1354807424998281217