The brokerage has also been criticized for relying on "payment for order flow" for most of its revenue, under which it receives fees from market makers for routing trades to them and does not charge users for individual trades.Ĭritics argue the practice, which is used by many other brokers, creates a conflict of interest, on the grounds that it incentivizes brokers to send orders to whoever pays the higher fees. It triggered calls among some investors on Reddit for a boycott of Robinhood's IPO. Robinhood placed temporary restrictions on buying GameStop and other stocks that hedge funds had bet against earlier this year, on grounds this was needed for the financial and operational stability of its platform. I just don’t trust them to do what's right for their customers the next time they find themselves in a hard spot," said machinist Zachary Wells, a Robinhood customer in Kansas City, Missouri, who has been trading on the app for more than a year.Ī Robinhood spokesperson declined to comment. "I had enjoyed Robinhood a lot, it sparked my interest in investing, it’s easy to use and straightforward.
#The user above is ultra gay meme registration#
Robinhood has warned in its IPO registration that the participation of retail investors could trigger a rollercoaster ride in its shares that could prove too risky for those seeking long-term sustainable gains.Ī Reuters review of social media posts on sites such as Reddit and interviews with Robinhood customers showed that some retail investors were skeptical about the IPO's prospects.Īmong the reasons they cited were their assessment that Robinhood's pursuit of a $35 billion valuation was unrealistic, the risk of regulators cracking down on Robinhood's business, and the company's imposition of trading curbs when the meme stock trading frenzy flared up at the end of January. The IPO is expected to price later on Wednesday and raise about $2 billion. In an unusual move, Robinhood has reserved between 20% and 35% of its IPO shares for retail investors who are users of its app. The trading app's monthly active users surged from 11.7 million at the end of December to 21.3 million as of the end of June, as retail investors on social media sites such as Reddit speculated on stocks such as GameStop and AMC Entertainment (NYSE: AMC) Holdings Inc. Becoming a meme stock itself comes with trading volatility that is giving pause to some potential investors in its initial public offering. (Reuters) - Robinhood Markets Inc thrived thanks to the popularity of so-called meme stocks such as GameStop Corp (NYSE: GME) with retail investors.
REUTERS/Dado Ruvic/Illustration/File Photo 2/2
FILE PHOTO: Robinhood logo is seen on a smartphone in front of a displayed stock graph in this illustration taken, July 2, 2021.