what do discount brokerage firms think about Robinhood?
- Thread starter zdreg
- Start date
I still don't understand....I have mentioned before that I trade with limit orders and pay exactly the price I want to pay for the stocks or ETFs I'm trading....so I don't understand where the other games are being played....I want to pay $10.00 for XYZ stock ...I paid $10.00 for XYZ stock using a limit order....where am I being taken advantage of...not only that but I'm NOT trading 50,000 shares !!!
Same as if you'd opened a Schwab account!
Get 500 commission-free online equity and options trades good for two years.
Yep with $100,000 account!
I opened my robinhood account with less than that and have traded for free!
And not for nothing but with more than half of the US with less than $1000 in their savings account where is someone going to run to schwab and place $100k in an account for 500 free trades.....someone who has $100k for a schwab account probably has a few million in assets! Just saying. And they probably don't care about commission free trading.
You did not pay zero dollars. All of your orders were sold for order flow which will have a large impact on your execution quality and results. I said it before but when say you are getting free trades you remind me of the brokers who used to claim "no commissions" on fx trades while providing a 100 pip spread. There is no free lunch.
I will never understand what the execution quality is or was, all I know and keep repeating is if I'm willing to pay $25.75 in a limit order for XYZ stock and lay exactly that as I would at another broker what is the difference....I put the order in say while the stock is trading at 25.98 and and it drops to my limit buy order price of $25.75, shares are purchased. Now I own it at the price I was willing to buy it at, $25.75. I paid zero commission. What am I missing. It's not like I put the same limit order in at $25.75 say at ameritrade and I receive this awesome gift from the market makers since I'm paying $6.95 for a trade that I'm going to get my limit order at $25.22 instead of $25.75.....
All I know is I'm close to $800 worth of free trades! I would have oaid nearly $1000 more as of now if I was with a broker that charged me a fee a trade.
You are obviously not an active trader. You are catching a falling knife - kind of like always the last man in line. The HFTs can lean on your order, trade around it and you can miss trades. If you're happy, great.
Robinhood has more accounts than etrade....you have to think how could this possibly be true, I guess free does sell....why the traditional brokers haven't done anything to compete with them is beyond me...they have plenty of ways to do so and aren't even trying....I can tell you I use Robinhood to place nearly 98% of my trades now, anything more than a few bucks a trade is too much now...once you have paid zero dollars to trade you find that spending even $6.95 is way too much...I'm up to nearly $1000 worth of free trades this year!!! A few years ago I had spent that much trading with Scottrade...no more !!!
Trading app Robinhood surpasses E-Trade in user numbers
https://www.cnbc.com/2018/05/10/trading-app-robinhood-surpasses-e-trade-in-user-numbers.html
Trading app Robinhood surpasses E-Trade in user numbers
- Stock and cryptocurrency trading app Robinhood has surpassed its rival E-Trade in user accounts, doubling that number to 4 million in the past year.
- The fin-tech start-up closed a $363 million series D funding round Thursday, valuing Robinhood at $5.6 billion.
- "In the next couple of years I think you'll see Robinhood looking like a full-service consumer finance company" says Baiju Bhatt, Robinhood co-founder and co-CEO.
https://www.cnbc.com/2018/05/10/trading-app-robinhood-surpasses-e-trade-in-user-numbers.html
Are you willing to pay 25.75 when the market is 25.50 ?
or ever notice the market was a 25.75 and you did not get filled ?
this is what EW is referring to. you and your order are being used. no free lunch.
Here is what Eastern Warrior is trying to explain to you. Let's take your example. Say you want to buy XYZ at 25.75. You believe this is a great trade and it's certainly going to 35.00 in a few weeks after earnings. So you bid for it at 25.75 and your buddy does the same using his IB account. The stock trades down to 25.75. It trades a LOT there. But you are the very LAST guy in the stack because that's what Robin Hood does. Your buddy gets filled and you don't. It doesn't trade all the way through. The stock sure enough goes to 35.00 in two weeks just like you predicted. Your buddy makes 9.25 per share, you make nothing. All because you wanted to save the equivalent of a penny per share. So technically your buddy didn't make 9.25. He made 9.23 after paying his commish to get in and out. You made NOTHING. Now, you might think this is not a big deal. I can tell you as someone who does this for a living that missing trades is a HUGE deal. I could give two shits about saving pennies when I'm trying to make 10 dollars. You will ALWAYS be at the bottom of the order stack. Now, most of the time this won't be an issue. But if you miss just one trade a year, it will wipe out all the savings and then some from the pennies you are saving. Just one trade and the economics go out the window.