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Here's the bailout.
Robinhood "raised" $1B overnight from existing investors.
The suits can't let Robinhood die. Who's gonna' help them front-run so many avg. joes otherwise?
Remember the ultimate iuris maxima: If something's free, you're the product. https://www.reuters.com/article/us-retail-trading-robinhood-idUSKBN29X2ZN
Robinhood "raised" $1B overnight from existing investors.
The suits can't let Robinhood die. Who's gonna' help them front-run so many avg. joes otherwise?
Remember the ultimate iuris maxima: If something's free, you're the product. https://www.reuters.com/article/us-retail-trading-robinhood-idUSKBN29X2ZN
Mother of all bailouts.
"Robinhood raised another $2.4 bn from shareholders, days after investors agreed to pump $1 bn into the brokerage...The $3.4 bn raised since last Thursday is more than the company has raised in its entire prior existence." https://www.wsj.com/articles/robinhood-raises-another-2-4-billion-from-shareholders-11612197680
"Robinhood raised another $2.4 bn from shareholders, days after investors agreed to pump $1 bn into the brokerage...The $3.4 bn raised since last Thursday is more than the company has raised in its entire prior existence." https://www.wsj.com/articles/robinhood-raises-another-2-4-billion-from-shareholders-11612197680
According to @TheBlock__, Robinhood made ~$1BN in 2020 from high-frequency trading firms (e.g. Citadel), who paid them to get an early view of the order flows generated by circa. 10M retail investors.
Nothing's free; you are a goddam profitable product. https://www.theblockcrypto.com/post/93321/robinhood-payment-for-order-flow-2020
Nothing's free; you are a goddam profitable product. https://www.theblockcrypto.com/post/93321/robinhood-payment-for-order-flow-2020
If the above is accurate, the stats suggest that Robinhood averages nearly $100 of annual revenue per customer.
Furthermore, if high-frequency trading firms are willing to pay an average of $100 per each customer order flow, annually, that means that such trading firms average,
Furthermore, if high-frequency trading firms are willing to pay an average of $100 per each customer order flow, annually, that means that such trading firms average,
*at the very least*, $100 +1 of annual revenue, from trading against Robinhood retail investors.
That's how profitable front-running customers is. It's so profitable, that it allows both trading firms (i.e. Citadel) and trading venues (i.e. Robinhood) to make a more than decent
That's how profitable front-running customers is. It's so profitable, that it allows both trading firms (i.e. Citadel) and trading venues (i.e. Robinhood) to make a more than decent
living out from the retail investor.
All the above whilst allegedly providing a "free" service that is sold as a driver of financial inclusion and a tool to fight inequality.
All the above whilst allegedly providing a "free" service that is sold as a driver of financial inclusion and a tool to fight inequality.
But wait, there's more.
If you think the WallStreetBets gamblers were the big winners, you might want to look a bit closer.
The article below reveals the massive amount of #GME shares held by America's largest investment firms and how much they made
https://www.vice.com/amp/en/article/y3gepx/investment-firms-are-the-big-winners-of-the-gamestop-stock-revolution-so-far
If you think the WallStreetBets gamblers were the big winners, you might want to look a bit closer.
The article below reveals the massive amount of #GME shares held by America's largest investment firms and how much they made
https://www.vice.com/amp/en/article/y3gepx/investment-firms-are-the-big-winners-of-the-gamestop-stock-revolution-so-far
thanks to the reddit-driven FOMO.
- BlackRock owned 9.2 million GME shares worth about $174 million in December 2020. Their position value increased to $3.1 Bn.
- Board member Ryan Cohen—who paid $76 million for his 13%—saw his position value increase to $3 Bn.
- BlackRock owned 9.2 million GME shares worth about $174 million in December 2020. Their position value increased to $3.1 Bn.
- Board member Ryan Cohen—who paid $76 million for his 13%—saw his position value increase to $3 Bn.
- Senvest Management is a NY hedge fund that snapped up 3.6 million GME shares in October for $43 million, a stake that is now worth $1.2 Bn.
- Vanguard Group, as of July 2020, owned 5.4 million GME shares—worth $21 million then and $1.8 billion now.
- Vanguard Group, as of July 2020, owned 5.4 million GME shares—worth $21 million then and $1.8 billion now.
But it doesn't end there.
Asset managers such as BlackRock and Vanguard don't only profit from the appreciation of their investments. Of particular interest, is that they also earn fees from lending securities to trading firms.
In the case at hand, they lent GME shares to
Asset managers such as BlackRock and Vanguard don't only profit from the appreciation of their investments. Of particular interest, is that they also earn fees from lending securities to trading firms.
In the case at hand, they lent GME shares to
hedge funds like Marvin Capital, so they could short the stock. At some point, the amount of GME shares that were lent to hedge funds who had short positions, amounted for an overwhelming 140% of the total shares in circulation. Asset managers lent more shares then there were in
existence, meaning that they charged lending fees for securities that didn't even exist.
Do you still think WallStreetBets gamblers were the big winners?
Do you still think WallStreetBets gamblers were the big winners?
What if I told you there's a possibility WallStreetBets has been a set-up all this time? — It seems like a perfect facade for asset managers to pump dying companies to their exit targets before they file for bankruptcy. Robinhood provides the liquidity for the exit.
