Looking for Robinhood alternatives? You've come to the right place as a DIY investor.
Robinhood is an online brokerage house that steals from the poor (retail investors) and gives to the rich (hedge funds). Robinhood doesn't charge its users a fee. But it sells its order flow to hedge funds and other institutional investors.
When Robinhood decided to arbitrarily shut down the trading of 13 names on January 28, 2021, it caused thousands of investors to lose billions of dollars. As a result, you would be nuts to continue trading on the Robinhood platform. During the next high-volume trading issue, you could get trapped again.
Now that Robinhood went public on July 29, 2021, it will be one of the greatest ironies if the Robinhood platform and other trading platforms had to suspend trading of HOOD stock. Since IPO, Robinhood's stock has performed poorly.
Features you want from an online brokerage:
- Reliability – You can log in without the website crashing. The online brokerage stays up during trading hours. There are few or no bugs.
- Fairness – You should be able to buy and sell and trade whatever securities you want without artificial interference from the brokerage. In other words, the brokerage won't randomly shut down the ability to trade certain names out of the blue or lock you out of their platform.
- Real-Time Quotes – In order to trade effectively, you need real-time quotes, not delayed quotes. Securities move too quickly for you to be waiting on a 10 or 15 minute lag.
- Robust Research – The best online brokerage houses will have robust proprietary research and data on various stocks and bonds. The research is important to get an idea of what the street is thinking and to help you make better investment decisions.
Beware Of Using Robinhood: Find Alternatives Instead
When Robinhood shut down the ability to trade in 13 names like Gamestop and AMC, it demonstrated to the entire investing community it was more concerned about protecting its own business and its investors, than doing right by its customers.
Before Robinhood significantly hurt its reputation as an online brokerage house, it was valued at more than $20 billion. Citadel, is one hedge fund that owns a big stake (~$700 million) in Robinhood. However, Citadel also owns a big stake in Melvin Capital, a hedge fund that was short Gamestop and other names, which had lost billions of dollars in the position.
Melvin Capital reportedly lost 53% in January 2021 due to Gamestop and other securities!
These cross dealings show how complicated and potentially rigged the system is. By shutting down trading in names that were causing big losses to one of its investors, Robinhood is hard to be trusted.
If I was trading on Robinhood, I would at least hedge by having capital at other online brokerage houses. This way, the next time Robinhood crashes, you can still make trades on a different platform.
Overall Recommended Robinhood Alternatives
Here are my three Robinhood alternatives ranked:
- Fidelity
- Charles Schwab
- TD Ameritrade
- Fundrise Innovation Fund
- Honorable mention: Ally Invest
Robinhood used to have a competitive advantage before October 2019. It offered free online trading of all securities, no matter how small of a position. Thanks to competitive forces, one-by-one, competing online brokerages eliminated their trading commissions as well.
Therefore, Robinhood no longer has an advantage. Further, do you really want Robinhood selling your data and investment flow to hedge funds so they can make money off you? Of course not. This is another reason why you need to look for Robinhood alternatives.
The Best Robinhood Alternative
I've been investing online since 1997 before even working on Wall Street from 1999 – 2012. I've tested and used eight online brokerages during this time. In my opinion, the best Robinhood alternative is Fidelity Investments, aka Fidelity.
Fidelity was founded in 1946 and has the most robust online trading platform. Its user interface is great. The research is robust. And the ability to create new accounts and transfer money is easy.
All trading on Fidelity is free. Further, Fidelity has its own index and sector ETFs as well. They are free and were free before all the online brokerages eliminated their trading fees.
I use Fidelity for my two children's Roth IRAs, custodial investment accounts, 529 plans, Solo 401k, SEP-IRA, and taxable investment accounts. Reconciling my trades come tax time is also easy because Fidelity does it for you.
Ideally, you want to have one online brokerage firm handle all of your investment accounts. It makes tracking your finances much easier.
I've been using Fidelity for over 20 years. Given Fidelity’s size, it has a better chance of withstanding massive trading floor when settling positions. Therefore, it should be able to stay up longer than the rest.
Other Robinhood Alternatives To Consider
If you don't want to go with Fidelity Investments, then here's a summary of the other Robinhood alternatives.
Charles Schwab
Charles Schwab was founded in 1971 and is publicly traded on the NYSE under the ticker SCHW. With a market capitalization of roughly $100 billion, Charles Schwab is a giant with low counterparty risk.
Schwab is the original disruptor in the discount brokerage space. It pioneered lower costs for investment funds and commissions. While it entered the no-commission-trade space after Robinhood, it was the first of the major brokerage firms to do so.
One interesting thing about Charles Schwab is that it acquired Motif Investing in May 2020. I used to consult for Motif down in San Mateo several years ago. By acquiring Motif Investing, Charles Schwab now successfully offers up fractional shares to its customers.
For example, let's say you only have a $5,000 portfolio. But you really want to buy Amazon stock that is trading above $3,000 a share. Buying one share of Amazon would mean your portfolio was 60% in Amazon stock. Instead, you can now buy a fractional share of Amazon for a more balanced allocation.
Schwab did put some restrictions on GameStop. It didn’t allow clients to sell naked call options “in order to mitigate an unlimited risk situation.” (Naked call options are sold uncovered, meaning without any offsetting positions.) But there was no outright ban on buying or selling.
TD Ameritrade
TD Ameritrade is one of the original online brokerage accounts. Ameritrade was the first online brokerage account I used to start trading back in 1997.
The company was founded as Ameritrade in 1971 before the company acquired competitor TD Waterhouse from the Toronto-Dominion Bank in 2006. The newly combined company was then renamed TD Ameritrade, with Toronto-Dominion Bank keeping about 40 percent minority ownership.
In October 2020, Charles Schwab Corporation acquired TD Ameritrade in a $22-billion stock deal that gave Toronto-Dominion Bank 13 percent minority ownership in Charles Schwab. Therefore, TD Ameritrade and Charles Schwab are under the same umbrella.
Honorable Mention: Ally Invest
Ally Invest is the online brokerage arm of Ally Bank, the popular online bank. With the same login, you can manage your banking and investments under one virtual roof.
Ally Invest is a relative newcomer to the market. Its parent company, Ally Financial, created the platform from its purchase of TradeKing in 2016. If you open an account with Ally Invest, you may be able to get a cash bonus up to $3,500. The bonus depends on how much you deposit.
Historical Problems With Robinhood
Robinhood was only founded on April 18, 2013. Therefore, it has had a lot of startup growing pains. If you are investing a significant amount of money, the last thing you want are glitches.
For example, at the beginning of March 2020, when all stock markets were tanking due to the global pandemic, Robinhood crashed three times in one week!
Given the crashes, investors couldn't sell or buy stock during the quickest stock market correction in history. If an investor had a position on margin, he or she could have gotten completely wiped out. Not being able to access your online brokerage account during times of extreme volatility is the worst.
If an investor on Robinhood read, How To Predict A Stock Market Bottom Like Nostradamus, and wanted to buy during the crash, he may not have been able to either.
Robinhood blamed the crashes were due to a mix of higher order volume and high account signups. Not being able to log onto your online brokerage account and make trades is a maddening feeling.
Too Many Recurring Debacles
The latest Robinhood debacle of shutting down the ability to buy 13 stocks on January 28, 2021 should make investors very wary. There are already so many investment variables to be aware of. To now have to always look behind your back, wondering whether Robinhood will bodyslam you is disconcerting.
I personally got entangled in Robinhood's nefarious ways after holding a remaining 50-share position in BBBY on January 28, 2021. I was day trading the day before to see if I could benefit from the Gamestop mania. When Robinhood decided to arbitrarily prohibit the buying of BBBY, the stock crashed by 40%!
If I had held onto my original 1,313 position in BBBY on January 28, I would have lost about $26,000! Instead, I “only” lost $500 after being up $500, for a $1,000 swing. Will Robinhood reimburse me and thousands of others for our losses? Doubtful.
Investors have filed a class action lawsuit against Robinhood for their decision to halt buying of 13 securities that literally wiped out billions of dollars of wealth.
Unfortunately, nothing will probably come of the class action lawsuit. Instead, Robinhood will probably grow even bigger as more FOMO-induced people on the sidelines sign up.
So don't worry Robinhood employees, founders, and institutional investors. You will most certainly get much richer after this latest debacle. Money over honor! Congratulations for raising another $3.2 billion from investors in a snap.
Find A Better Online Brokerage Than Robinhood
Robinhood had a strong value proposition when it offered free trades before the competition followed suit. Now, Robinhood has no competitive advantage. Instead, Robinhood offers a worse value proposition for traders and investors.
Do you really want to trade on a platform that steals from the poor and gives to the rich? Institutional investors like hedge funds will get rich off of Robinhood's IPO.
Hedge fund managers often charge a 2% fee on assets under management and 20% of profits. Therefore, many of these hedge fund managers are making huge money. We're talking $100+ million or $1+ billion paydays for some of the largest hedge funds. This includes the owner of Citadel, which owns a large portion of Robinhood.
Look into investing with the Robinhood alternatives I mentioned in this post instead. If you ever get caught up in a Robinhood outage or halt-trading debacle like I did, you will be livid.
Diversify Your Investments Into Real Estate
Stocks are very volatile compared to real estate. Therefore, if you want to dampen volatility and build wealth at the same time, invest in real estate. Real estate is my favorite asset class to build wealth.
The combination of rising rents and rising capital values is a very powerful wealth-builder. By the time I was 30, I had bought two properties in San Francisco and one property in Lake Tahoe. These properties now generate a significant amount of mostly passive income.
In 2016, I started diversifying into heartland real estate to take advantage of lower valuations and higher cap rates. I did so by investing $810,000 with real estate crowdfunding platforms. With interest rates down, the value of cash flow is up. Further, the pandemic has made working from home more common.
Best Private Real Estate Investing Platforms
Fundrise: A way for all investors to diversify into real estate through private funds with just $10. Fundrise has been around since 2012 and manages over $3.3 billion for 400,000+ investors.
The real estate platform invests primarily in residential and industrial properties in the Sunbelt, where valuations are cheaper and yields are higher. The spreading out of America is a long-term demographic trend. For most people, investing in a diversified fund is the way to go.
CrowdStreet: A way for accredited investors to invest in individual real estate opportunities mostly in 18-hour cities. 18-hour cities are secondary cities with lower valuations and higher rental yields. These cities also have higher growth potential due to job growth and demographic trends.
If you are a real estate enthusiast with more time, you can build your own diversified real estate portfolio with CrowdStreet. However, before investing in each deal, make sure to do extensive due diligence on each sponsor. Understanding each sponsor's track record and experience is vital.
I've invested $954,000 in real estate crowdfunding so far. My goal is to diversify my expensive SF real estate holdings and earn more 100% passive income. I plan to continue dollar-cost investing into private real estate for the next decade.
Invest In Private Growth Companies
In addition to investing in public equites through Robinhood and Robinhood alternatives, consider investing in private growth companies through a venture capital fund. Companies are staying private for longer, as a result, more gains are accruing to private company investors. Finding the next Google or Apple before going public can be a life-changing investment.
One of the most interesting funds I'm allocating new capital toward is the Innovation Fund. The Innovation fund invests in:
- Artificial Intelligence & Machine Learning
- Modern Data Infrastructure
- Development Operations (DevOps)
- Financial Technology (FinTech)
- Real Estate & Property Technology (PropTech)
Roughly 35% of the Innovation Fund is invested in artificial intelligence, which I'm extremely bullish about. In 20 years, I don't want my kids wondering why I didn't invest in AI or work in AI!
The investment minimum is also only $10. Most venture capital funds have a $250,000+ minimum. In addition, you can see what the Innovation Fund is holding before deciding to invest and how much. Traditional venture capital funds require capital commitment first and then hope the general partners will find great investments.
Related posts:
The Proper Asset Allocation Of Stocks And Bonds By Age
The Recommended Split Between Active Investing And Passive Investing
Robinhood Alternatives is a Financial Samurai original post. For more nuanced personal finance content, join 65,000+ others and sign up for the free Financial Samurai newsletter. Financial Samurai is one of the largest independently-owned personal finance sites that started in 2009. I help people get rich and live the lifestyles they want.
Currently have my Roth and solo 401 at schwab and managed by a third party advisor. I have been wanting to go so self management and had vanguard in my head because I planned on buying and holding their index funds after the transfer. After reading this I think I will do a bit more research first. Appreciate the write up and everyones comments.
Just saw this article about the parents of Alex Kearns have sued Robinhood related to his suicide:
https://www.cbsnews.com/news/alex-kearns-robinhood-trader-suicide-wrongful-death-suit/
I can relate to getting frustrated by automated responses from companies. My dishwasher has been broken for 1.5 weeks (with 3 kids) and dishwasher repair automated scheduling systems have erred resulting in 2 cancellations thus far, which has caused me to lose my cool.
I’ve been quite satisfied with Vanguard, although I also use Fidelity.
I had a bad experience with a brokerage when I was in college (all snail mail back then) and they managed to delay selling my stock until there was little left but smoke and ash. I firmly believed they were playing games and pocketed the difference between when I ordered the sale and when they finally sold it, two weeks later.
Hi Sam
Do any of these online traders cater to non-US citizens non-US residents and without a bank account in a US bank?
I know it sounds like a lot, but you also have offshore readers ;-)
I’ve found that to be the main obstacle to sign up.
Thanks in advance, keep up the great work writing
Hi Sam, you mention that ideally we should have one online brokerage handle all of our transactions for ease of management and makes it easy come tax filing time. What is not clear to me is, are we at a risk of losing if the underlying institution goes bankrupt or some similar scenario (running out of money etc.). I understand for the cash accounts there is the FDIC coverage up to 250K for single account owner. Can you talk about this subject in detail in one of your upcoming posts.
I also think Robinhood will be alive and well once the dust settles, but in the short-term it seems like they lost a lot of customers with their shenanigans. Anecdotal but Fidelity and TDA were apparently experiencing extremely high call volumes related to receiving transfer requests.
Anyway I think the only remaining competitive edge Robinhood offers is their mobile UI. It looks very clean, modern, and well organized.
After reading comments over the last couple kof days to Sam’s article, seeing what you all are thinking and doing, I’d like to make some seraguggestions based on my 35 years of experience regarding brokerages.
First, use a brokerage. One that was around before the ’87 crash. They have experience through three different types of major crashes, 1987’s, 2000’s and 2008’s and the less harsh but, still high volume corrections.
Second, make sure, even if you trade on line, make sure the brokerage is accessible by phone 24/7.
Third, check out their research abilities and make sure what they offer and that you are and will be comfortable using their research tools.
Fourth, if you use margin make sure you are comfortable with their rules and charges.
Sixth, if you trade options, there too, make sure their rules and costs are fine with you.
Seventh, make sure you are not charged for trades. Most don’t now but . . . just make sure.
Without good backofffice and online infrastructure borne from years of experience, a brokerage crashing or not providing good backup at the wrong time can kill your portfolio.
Don’t go for hip. Play it safe. Use the big boys.
Forget Ally wait times on the phone are way too long. Simple enough interface but when I needed help I couldn’t get them to call me back for 4 days. even then I had to call them again to remind them that they owed me a phone call back. I now trade with TD Ameritrade and a much happier.
Interactive is top notch.
What other broker doesn’t sell your order flow to Citadel and other high frequency traders?
When GameStop comes back down to earth, it’s bringing the entire US market with it.
+1 for Fidelity. They also seem to have very reasonable Bond commissions from what I’ve seen so far :)
Can’t wait for bond commissions to go to zero and the bid / ask spread, especially for municipal bonds to narrow!
The funny thing is I was just telling my friends about two weeks ago how Robinhood is shady. They were looking to get started into investing and I warned them. One of them got crushed on margin when the security went to sell only during the GME fire sale. Almost wish I could post a screen shot. I have been with Vanguard a long while, but more recently switched over to Fidelity for the reasons you pointed out. I still have a small Merrill Lynch holding as well, but only because of relationship banking with BOFA. They allow you to link with your accounts to keep the tiered status with BOFA. Figure getting something for nothing makes sense, so I just leave the minimum in ML to satisfy the BOFA tier status. Still thinking about moving it all to Fidelity though. They have been great.
Sam
Can you comment on merrill lynch
i use Interactive Brokers because their margin rates are crazy low. 1% and i can margin all the way up to 15% equity although i keep my margin level no more than 35%. At that level i’m safe even with a 50% drop in the market. I wrote you on this a couple years ago and you continue to insist that margin is dumb. i think you should reevaluate your position and advocate for modest margin levels for sophisticated investors who want to maximize long term returns. Even Money Mustache has finally figured this out. I think this would be a good topic for a future post.
You recommend going on margin in this environment? No, not a good idea. The average investor will likely get slaughtered.
MMM makes hundreds of thousands of dollars a year from his website fooling you and his readers that he is frugal. Don’t believe the smoke and mirror. His wife left him, partly because she didn’t want to live that type of lie anymore.
Going on margin is bad with so much mania going on in the stock market.
I hear you. But trying to outguess the market is a fools errand. Make your move slowly. Say you have a $1m diversified portfolio of ETFs. Move it to IB and buy $100k of VTI on margin. Add another $100k every 4 months or so until you have around $350k on margin. Long term you can’t lose. This is for long term money and you just ride out any drops. i’ve done for over 10 years now. If margin rates spike up i’ll reevaluate but this is an almost guaranteed way to improve your results long term.
You said you opened up Roth IRAs for your two kids. How is your newborn earning income?
They are much older and working, I didn’t know that they could have iras as well as a 4021. Doctors and their families stink when it comes to knowing how to save money.
Do you have any thoughts on using InteractiveBrokers as an alternative?
IB now also have a zero commissions (for US stocks) option, but I have stuck with the “Pro” account which has commissions. Commissions on US stocks are low anyway.
I have half my money at vanguard. I purposely haven’t changed it into a brokers account because they require you to wait 30 days to invest in the same security you sold unless you send them a permission letter. This has kept me from trying to time the market up and down in 2008.
The other half is at Schwab. There great, I’ve never had a problem with anything and my account representative has been very helpful. I even get a dozen golf balls sent to me every birthday.
I also have a Robinhood account that I opened the same time my wife started investing. She didn’t know anything and Robinhood is definitely the easiest to use if you have none or limited knowledge in the market. We only put a $1000 each into our accounts.
My daughter who is more knowledgeable about investing went with schwab. My account rep even offered to help take care of her even though she was far under the minimum dollar amount for this particular service.
Robinhood certainly has the edge on the UI, however one other glaring concern with them is the fact they don’t allow any beneficiary/POD election on your account. Meaning, if something were to happen to the account holder, the next of kin will have to jump through hoops to access the funds. I find that a little shortsighted!
Thank you Sam for continuing to shine the light on issues that impact many!
Schwab has been having problems for over three months now. You can not get a broker on the phone without being put on hold for at least 20 minutes before all this happened and now you just get disconnected. Their servers can. It handle all the businesses that they have bought up.
Schwab servers can’t handle the businesses they have bought up.
I noticed vanguard wasn’t on the list which surprised me. Any reason why it didn’t make it?
As someone who has an IRA account that was at one time a 401K through my former employer who had it set up with Vanguard, I know that Vanguard doesn’t have 24/7 phone support. I’m also not as keen on their research infrastructure as I am with Schwab’s. I think Vanguard is more focused on its mutual fund oriented businesses. I prefer Schwab for my active brokerage use. Someone mentioned that it’s hard to get someone on the phone at Schwab. I’ve used them for the last five years after being with others (TD Waterhouse and Tradeking/Ally) for 20 years before that. I have not over the five years I’ve been back with Schwab, ever had a hard time getting someone on the phone. I will tell you this though, if you call ANY brokerage during the first half hour of the trade day, (the first half of what I call the “crazy hour,” when all the dumb money is calling) as well as the the last fifteen minutes of he trading day, you’re going to have to wait longer for a call pickup at any brokerage.
I predominantly use Etrade, primarily because my options commissions (15 cents per contract) were grandfathered when they bought optionshouse. On occasion when the market has big moves, their platform gets very slow.
I have an account with webull and after they did the same as robinhood, I am closing it.
All of the brokers who halted trading should immediately be forced to liquidate. I hope you’re wrong they’ll win any lawsuits but I suspect you are right.
With Robinhood, I understand the desire to not use them since they shut out the ability to buy stock, But with Webull it’s a different story. The CEO went online and explained in a transparent manner why they had to shutdown trading, and it had to do with their Clearing Houses:
https://www.youtube.com/watch?v=4RS4JIEVyXM&t=721s
Whether you would still want to use them is your call, but explaining to your customers what happened and admitting fault is something many big businesss should learn from. These kinds of answers give me more trust in using WeBull, not less.
Isn’t this exactly what Robinhood’s CEO also said?
https://www.coindesk.com/robinhood-ceo-protect-firm-limit-buy-orders
I do think this brings to light a risk of using a startup broker, but it also seems that Webullmis corroborating Robinhood’s story–that the volume was so heavy, the brokerage had to pony up kkore capital until the trades cleared.
E-Trade also stopped traders from buying AMC and GME Thursday and I ended up moving my Roth over to Fidelity because they did that. I wasn’t planning on buying either of these stocks at the time, but the fact that they did that really bothered me. Just thought I’d share since they would also be one of the brokers that would be forced to liquidate with your proposal. They also haven’t even tried to explain why like some of the other brokers have…
I started with TD Ameritrade, and then Fidelity. I’ve been a happy customer with Fidelity for years so I never bothered opening a Robinhood account. It’s crazy what they did with the trade blocks.
Sam,
I agree that there are a ton of better alternatives to Robinhood when it comes to reliability. One of the other downsides to moving away from Robinhood is their UI. Placing orders at Robinhood is phenomenally simple to do. You just swipe up and then there you go. Stocks are now a part of your property.
A lot of the other online brokerages you mentioned have awful UI. It takes forever to place a trade (30-90 seconds). As much as I dislike Robinhood for what they did, I would love to join a brokerage who has a simple UI like Robinhood.
I’m struggling to balance the reliability factor with the user experience that comes with alternative brokerages. Do you have thoughts? I would love to switch to another broker!
I use both Robinhood and Fidelity’s apps. I also agree that Fidelity’s user interface is not as easy to use as Robinhood. Therefore, I mainly use Robinhood. I only use Fidelity for some OTC commodity stocks not available through Robinhood. I’m a long term investor and haven’t had the need to make trades during the times Robinhood has been down.
That makes sense. Maybe I should look into adding Fidelity to my list of brokers.. hmm…
I wish some company would pop up that provides better services than Robinhood yet still has the same easy-to-use user interface.
I started with Schwab in the 80’s and I’m back with them 35 years later with TD and Tradeking/Ally in between. I did forget that I had a 401K that is now an IRA with Vanguard. They don’t charge for trading but, I wouldn’t recommend them. I think their focus is still more mutual funds than brokerage.
Personally, I like Etrade a fair amount. I also use Ally, TIAA, and Sofi. No complaints with any of them. All pretty easy to use. I’ve got Transamerica for a larger 403B, but don’t know if they do regular consumer trading. As usual, I recommend putting your money into a Roth, so it’ll be tax free when you pull it out.
I love Fidelity, have had an account with them since I was 15 (mom works there). I have never had a problem and their customer service is always great.
Thanks for this article. It is great to hear your perspective as someone who worked in Wall Street.
I donc redit RobinHood for making me interested in learning how to invest by myself.
But after having some of my pending BUY transactions canceled just like that and only allowed to sell made me realize I AM the product that RobinHood is making money from.
Great wake-up call
How about E*TRADE/Morgan Stanley)? I like using my 3 firms -Fidelity, E*TRADE and Schwab. Each has its own strengths. Yes, a little more work to track.
Kk
I thought TD Ameritrade also stopped trading AMC, NOK, and GameStop?
TD Ameritrade said it “has not halted trading in any securities. We have placed restrictions on some transactions in $GME and other securities.”
While these restrictions “differ from security to security and are subject to change,” they include steps such as “increasing margin requirements or limiting certain types of transactions, like short sales and those that may involve unlimited risk.”
Good analysis of Robinhood.
Curious, what jobs are your kids getting paid for that they can have a Roth IRA?
Picking up tennis balls?
Thanks
Starting using Ally Invest about 1 year ago. I do like the fact that I check on Investment portfolio (Very Small-just starting out) and Savings Account under the single log in!! I wasn’t sure how Ally stacked up against the “Big Boys” but I am very Happy with their system. I do not believe they offer fractional shares at this point, so I was wondering if I should step into another brokerage for that benefit alone!! Sam, any thoughts on that scenario????
I wish I was younger and understood how to cash in on the crazy few days…
I agree IndianMama! But Sam has confirmed what I’ve always known- Wall Street is rigged and it’s absolutely disgusting and unfair to the little guy. There’s so much money being made at hedge funds, trading companies, etc., I sure hope they can look at themselves in the mirror and know what they are doing is humanly unkind. After watching the Jeffrey Epstein documentary on Netflix….how did a guy like that who drops out of college end up making that kind of money?? I hope there’s a place for people like that if you know what I mean.
You think that with less than five % ownership of Robinhood they were able to tell them what to do? That’s usually not nearly enough ownership to push the CEO or the board around. My former employer has an activist shareholder with over 15 % of the company’s shares and they’ve totally rejected his demands. I’m thinking Robinhood’s motive may have been more about fear of prosecution
for aiding the possibly illegal stock manipulation being done by the Reddit group of investors.
Phone calls were surely made. It is a tight circle.
Robinhood couldn’t handle the volume and the settlements. It is was/is too small.
Whether it was contacts, protecting their customers, or simply solvency; your broker making decision on what individual stock you can trade is not a good thing as a customer.
They also route orders through citadel. The were fined $65 million for routing through preferred traders instead of the cheapest.