Re:Robinhood reports 43% revenue decline
by WoahNoun on Friday April 29, 2022 @04:40PM
(#31210332)
They've been pretty open actually. They did not have enough cash on hand to support the buy volume. They have said this repeatedly. They have also said if incoming bank transfers from retail investors had settled faster they would have had enough cash. The "instant deposit" feature of letting people buy stocks with cash deposits they had only initiated but had not settled meant they didn't have the cash on hand to support more buying.
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January 27th, 2021 Robinhood sent me an email warning that "In an effort to help reduce risk, we've begun implmenting certain restrictions for GME and AMC options trading". They explain some restrictions being made to options. They don't provide any sort of warning that completely removing the ability to buy the underlying stock for all of their users was even a possibility.
I think it sshould be part of their fiduciary duty to inform people of the risks of purchasing stocks that they are running out of collateral for.
Re:Robinhood reports 43% revenue decline
by WoahNoun on Saturday April 30, 2022 @01:05AM
(#31213476)
> inform people of the risks of purchasing stocks that they are running out of collateral
People weren't allowed to purchase those stocks so I'm not sure what risks you are talking about. There was no (additional) risk from purchasing from RH versus anywhere else. You could always sell. Not allowing people to buy doesn't have anything to do with fiduciary duty. A broker doesn't have to let you buy whatever you want.