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by AmericanChopper 1966 days ago
> people YOLOing on meme stonks

This is all that day trading is. Regardless of whether the traders even know what a meme subreddit is. Why would any day trader want to use a platform that’s going to do stuff like cut you out of an epic short squeeze? If a non-professional investor had sensible ideas, they wouldn’t be day trading.
1 comments
Clewza313 1966 days ago
There's day trading, and then there's taking out credit card cash advances to buy leveraged call options on a stock that's already gone up 1000% in a month. Both are risky, but the day traders I've known wouldn't touch the latter with a barge pole.
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AmericanChopper 1966 days ago
Would the day traders you know be happy using a brokerage who’s liquidity issue mean it’s had to ban trading certain securities? Even if they don’t want to YOLO like a maniac, why would you trust a company that’s had so many very public blunders with your money? It’s not like there aren’t more reputable zero-fee brokerages out there.
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jmalicki 1965 days ago
At least special margin requirements have always existed, and usually day traders know to avoid them or how to deal with the special requirements with a broker that allows you a more sophisticated view of the market. e.g. for Interactive Brokers, you look at this list and know you're going to have a pain trading these stocks:

https://www1.interactivebrokers.com/en/?f=%2Fen%2Ftrading%2F.....

Because RH abstracts those details away to make the interface easier, the only hammer they could use was to ban trading in those securities.

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stickfigure 1966 days ago
...which all did the same thing, no?
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AmericanChopper 1965 days ago
Schwab/Ameritrade didn’t.
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ilikehurdles 1965 days ago
You couldn’t buy any of the stocks with settled cash. Why keep bringing up margin and leverage and credit cards? Several other brokers did halt buying after Alpha Clearinghouse said they couldn’t fulfill them — but that block from the clearinghouse lasted a few hours on a few securities. Robinhood blocked a lot more securities for the entirety of the day.

There’s this need to paint retail investors as incapable of understanding margin and leverage to bias the conversation and make them seem in need of being rescued from themselves — but robinhood hurt a lot more than just those over-leveraged people (not that they would be justified in hurting any of them).

I had small positions in the app for the last year after starting an etrade account — none of them in memes and none of them on margin, none of them blocked by RH’s actions - and I will be joining the people exiting and closing their accounts.

If you’re looking for a casual broker that doesn’t behave unethically and incentivizes safe and informed investing for newbies, take a look at Public[1].

[1]: https://medium.com/the-public-blog/a-note-on-access-with-res...

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