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A comment on Robinhood: We are letting go approximately 9% of our full-time employees. Parent comment

Re:Robinhood: We are letting go approximately 9% of our full... by nly on Tuesday April 26, 2022 @08:07PM (#31174718)
They don't front-run orders. They still give best execution but they receive a small fee from market makers for sending orders their way.

If both market maker A and market maker B offer the same price but B is going to pay them slightly more than A for your order, then they can legally route your order to B.

Many brokers do this now.

Front running is different entirely. For example, if you were about to buy a load of stock, front running would be Robinhood buying in before you, waiting for your order to clear the price level, and then selling a few ticks higher.

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Re:Robinhood: We are letting go approximately 9% of our full... by NovemberWhiskey on Wednesday April 27, 2022 @12:43AM (#31176397)
>They don't front-run orders. They still give best execution but they receive a small fee from market makers for sending orders their way.

I really have most serious doubts about the idea that you can simultaneously get paid for order flow and deliver on your best execution obligations - the payment for order flow literally comes out of missed price improvement opportunities for the customer. FINRA seems to feel the same way and fired a warning shot over the bows last year: https://www.finra.org/rules-guidance/notices/21-23

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