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by Traster 1839 days ago
That's not evidence that RH was:

> supporting the short selling hedge funds

Just to be clear: Robinhood claims that they prevented buying certain stocks because of increase collateral requirements by DTCC due to high volatility. Do you have any evidence that's untrue. Let's establish that before we move on to the claim that Citadel front-runs retail flow.

1 comments

From my understanding, the reason the DTCC raised collaterals so heavily was mostly due to the risk on the short side. So they were protecting the hedge funds by protecting themselves, and it carried on to Robinhood. So Robinhood didn't really have a choice, but they still were protecting the shorts in the end.
And that's what happens when you play financial games you don't understand.

If your strategy for driving a short squeeze, or a pump-and-dump does not take into account counterparty risk, you are going to get taken to the cleaners. When you making money causes the brokerage you are using to be unable to execute that trade, this is 100% your fault.

As the saying goes, don't invest in financial instruments you don't understand. Entering a long position in a volatile, high-volume stock through a discount brokerage was a financial instrument that most of /wsb did not understand, and it blew up in its face.