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Stock-Age: Stocks, Options and Dividends oh my!

Nikana

Nikana

Go Go Neo Rangers!
Zefah said:
Really makes you feel powerless and helpless and that's the goal. Now imagine what people without forums and chat rooms feel like?

This is how the big players have been rolling forever, but I think it's the first time that we all so clearly saw what was going on and that's why they had to quite literally have the brokers tie our hands behind our backs so we couldn't make any plays.
Click to expand...

Least I know my thoughts are alone.
 
Alfen Dave

Alfen Dave

Member
SlimySnake said:
I lost $700 on AMC and Blackberry after making $400 yesterday.
oMr4hIa.png



tenor.gif
Click to expand...


This is nothing lol.

I once lost 10k+ on a single day.

You make some. You lose some.
 
Myths

Myths

Member
Lost 10K on NOK. Meh. Bunch of punks.

in other news... DOGECOIN is jumping like crazy in these after hours. It’s beaten its regular hours value now.
 
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finowns

finowns

Member
EmaiL from rh:

It’s been a tough day, and we’re grateful to you for being a Robinhood customer. In light of the extraordinary market conditions this week, we temporarily limited buying for certain securities this morning. Starting tomorrow, we plan to allow limited buys of these securities. We’ll continue to monitor the situation and may make adjustments as needed.
This was a temporary decision made to best continue serving you, and was not an easy one to make. We know it’s led to frustration and confusion, and wanted to provide some clarity.
As a brokerage firm, we have many financial requirements, including SEC net capital obligations and clearinghouse deposits. Some of these requirements fluctuate based on volatility in the markets and can be substantial in the current environment. These requirements exist to protect investors and the markets and we take our responsibilities to comply with them seriously, including through the measures we have taken today.
To be clear, this decision was not made on the direction of any market maker we route to or other market participants.
The past year in particular has shown us that the financial markets are for everyone—not just institutional investors and hedge funds. We’ve seen a new generation enter the market, and they’re sparking conversations about what it means to be an investor. We stand in support of you, our customers. Democratizing finance for all means giving more people access, not less.
We’ll keep monitoring market conditions and will update this Help Center article with the latest changes. We also published a blog post regarding today’s events.
Thank you again for being a Robinhood customer. We’re so grateful for your support.
Sincerely,
The Robinhood Team
 
D

Dunki

Member
finowns said:
EmaiL from rh:

It’s been a tough day, and we’re grateful to you for being a Robinhood customer. In light of the extraordinary market conditions this week, we temporarily limited buying for certain securities this morning. Starting tomorrow, we plan to allow limited buys of these securities. We’ll continue to monitor the situation and may make adjustments as needed.
This was a temporary decision made to best continue serving you, and was not an easy one to make. We know it’s led to frustration and confusion, and wanted to provide some clarity.
As a brokerage firm, we have many financial requirements, including SEC net capital obligations and clearinghouse deposits. Some of these requirements fluctuate based on volatility in the markets and can be substantial in the current environment. These requirements exist to protect investors and the markets and we take our responsibilities to comply with them seriously, including through the measures we have taken today.
To be clear, this decision was not made on the direction of any market maker we route to or other market participants.
The past year in particular has shown us that the financial markets are for everyone—not just institutional investors and hedge funds. We’ve seen a new generation enter the market, and they’re sparking conversations about what it means to be an investor. We stand in support of you, our customers. Democratizing finance for all means giving more people access, not less.
We’ll keep monitoring market conditions and will update this Help Center article with the latest changes. We also published a blog post regarding today’s events.
Thank you again for being a Robinhood customer. We’re so grateful for your support.
Sincerely,
The Robinhood Team
Click to expand...
The are sooo fucked

almost back:

193.60-153.91 (-44.29%)
At close: January 28 4:00PM EST


288.00 +94.40 (48.76%)
After hours: 6:12PM EST
 
Last edited:
FunkMiller

FunkMiller

Gold Member
finowns said:
EmaiL from rh:

It’s been a tough day, and we’re grateful to you for being a Robinhood customer. In light of the extraordinary market conditions this week, we temporarily limited buying for certain securities this morning. Starting tomorrow, we plan to allow limited buys of these securities. We’ll continue to monitor the situation and may make adjustments as needed.
This was a temporary decision made to best continue serving you, and was not an easy one to make. We know it’s led to frustration and confusion, and wanted to provide some clarity.
As a brokerage firm, we have many financial requirements, including SEC net capital obligations and clearinghouse deposits. Some of these requirements fluctuate based on volatility in the markets and can be substantial in the current environment. These requirements exist to protect investors and the markets and we take our responsibilities to comply with them seriously, including through the measures we have taken today.
To be clear, this decision was not made on the direction of any market maker we route to or other market participants.
The past year in particular has shown us that the financial markets are for everyone—not just institutional investors and hedge funds. We’ve seen a new generation enter the market, and they’re sparking conversations about what it means to be an investor. We stand in support of you, our customers. Democratizing finance for all means giving more people access, not less.
We’ll keep monitoring market conditions and will update this Help Center article with the latest changes. We also published a blog post regarding today’s events.
Thank you again for being a Robinhood customer. We’re so grateful for your support.
Sincerely,
The Robinhood Team
Click to expand...

Oooh. The universe isn’t big enough for them to fuck off far enough.
 
D

Deleted member 17706

Unconfirmed Member
finowns said:
EmaiL from rh:

It’s been a tough day, and we’re grateful to you for being a Robinhood customer. In light of the extraordinary market conditions this week, we temporarily limited buying for certain securities this morning. Starting tomorrow, we plan to allow limited buys of these securities. We’ll continue to monitor the situation and may make adjustments as needed.
This was a temporary decision made to best continue serving you, and was not an easy one to make. We know it’s led to frustration and confusion, and wanted to provide some clarity.
As a brokerage firm, we have many financial requirements, including SEC net capital obligations and clearinghouse deposits. Some of these requirements fluctuate based on volatility in the markets and can be substantial in the current environment. These requirements exist to protect investors and the markets and we take our responsibilities to comply with them seriously, including through the measures we have taken today.
To be clear, this decision was not made on the direction of any market maker we route to or other market participants.
The past year in particular has shown us that the financial markets are for everyone—not just institutional investors and hedge funds. We’ve seen a new generation enter the market, and they’re sparking conversations about what it means to be an investor. We stand in support of you, our customers. Democratizing finance for all means giving more people access, not less.
We’ll keep monitoring market conditions and will update this Help Center article with the latest changes. We also published a blog post regarding today’s events.
Thank you again for being a Robinhood customer. We’re so grateful for your support.
Sincerely,
The Robinhood Team
Click to expand...

Lying fucking scumbags. They completely betrayed their entire mission. As soon as I cash out, I'm done with the platform. Already opened up a Fidelity account for future trades.
 
ManofOne

ManofOne

Plus Member
So it seems I was partly right.

Robinhood Is Said to Draw on Bank Credit Lines Amid Tumult​


“As a brokerage firm, we have many financial requirements, including SEC net capital obligations and clearinghouse deposits,” Robinhood said in a blog post Thursday. “Some of these requirements fluctuate based on volatility in the markets and can be substantial in the current environment. These requirements exist to protect investors and the markets and we take our responsibilities to comply with them seriously, including through the measures we have taken today.”
The extreme volatility “generated substantial risk” for brokerages, resulting in the need for stricter requirements on those firms, according to the Depositary Trust & Clearing Corp.
“When volatility increases, portfolio margin requirements increase too,” Wall Street clearinghouse DTCC said in an emailed statement.
Click to expand...

They were warned by a committee to maintain capital

https://www.bloomberg.com/news/arti...-banks-amid-tumult?srnd=premium&sref=Qbp5xjjH
 
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C

Corgi1985

Banned
The whole fucking system is corrupt. Robinhood suspending buying but not selling is some blatant market manipulation to appease their hedge fund overlords. Shorting over 100% of a stock shouldn't even be a thing. I genuinely hope some c-suite execs suffer significantly from this. Like bankruptcy and living in a cardboard box type shit.
 
BigBooper

BigBooper

Member
Fictive said:
Lost 10K on NOK. Meh. Bunch of punks.

in other news... DOGECOIN is jumping like crazy in these after hours. It’s beaten its regular hours value now.
Click to expand...
Sympathy for the NOK, but lol do not jump in on the DOGECOIN train imo.

NOK was a smokescreen pump n dump.

Edit: At least look at the future value proposition of dogecoin. It's value is powered by rainbows.
 
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ManofOne

ManofOne

Plus Member
Zefah said:
Lying fucking scumbags. They completely betrayed their entire mission. As soon as I cash out, I'm done with the platform. Already opened up a Fidelity account for future trades.
Click to expand...

i'm gonna play devil's advocate here and say I don't think they're lying. Check the SEC rules for clearing houses. They have capital requirements. If, the positions were eating into their capital then they will go bankrupt.
 
D

Dunki

Member
ManofOne said:
i'm gonna play devil's advocate here and say I don't think they're lying. Check the SEC rules for clearing houses. They have capital requirements. If, the positions were eating into their capital then they will go bankrupt.
Click to expand...
but they gave billions to bail out melvin and citadel
 
D

Deleted member 17706

Unconfirmed Member
ManofOne said:
i'm gonna play devil's advocate here and say I don't think they're lying. Check the SEC rules for clearing houses. They have capital requirements. If, the positions were eating into their capital then they will go bankrupt.
Click to expand...

No idea what their actual situation is because they are hiding any worthwhile information behind PR speak. They can get fucked. How could they possible reiterate their mission to democratize stock trading after what they did today? Maybe if the dude got out early this morning and candidly told people what Robinhood's situation was and what he is being forced to do, then sure, people might listen if it made actual sense, but that's not what's happening.
 
ManofOne

ManofOne

Plus Member
Dunki said:
but they gave billions to bail out melvin and citadel
Click to expand...

See the net capital rule for brokerage firms.

The uniform net capital rule is a rule created by the U.S. Securities and Exchange Commission ("SEC") in 1975 to regulate directly the ability of broker-dealers to meet their financial obligations to customers and other creditors.[1] Broker-dealers are companies that trade securities for customers (i.e., brokers) and for their own accounts (i.e., dealers).[2]

The rule requires those firms to value their securities at market prices and to apply to those values a haircut (i.e., a discount) based on each security's risk characteristics.[3] The haircut values of securities are used to compute the liquidation value of a broker-dealer's assets to determine whether the broker-dealer holds enough liquid assets to pay all its non-subordinated liabilities and to still retain a "cushion" of required liquid assets (i.e., the "net capital" requirement) to ensure payment of all obligations owed to customers if there is a delay in liquidating the assets.[4]

On April 28, 2004, the SEC voted unanimously to permit the largest broker-dealers (i.e., those with "tentative net capital" of more than $5 billion) to apply for exemptions from this established "haircut" method.[5] Upon receiving SEC approval, those firms were permitted to use mathematical models to compute the haircuts on their securities based on international standards used by commercial banks.[6]
Click to expand...
 
D

Deleted member 17706

Unconfirmed Member
ManofOne said:
See the net capital rule for brokerage firms.
Click to expand...

Surely they could have handled this differently, though?

Temporarily disable margin, temporarily disable grace period on fund deposits, etc. Make sure they are only trading with real money (lol) that already safely cleared the banks.

They said they shut down trading of specific stocks due to volatility to protect their customers. It was bullshit. It's not like stocks having meteoric rises is necessarily a foreign concept on Wall Street. I don't buy that they simply would have not been able to cover this. Their situation is far more dire if that's the case, no?
 
T

Taxexemption

Member
When they make the movie the Leonardo Dicaprio memes might be confusing. He would almost definitely be cast to play a character, but WSB is full of memes about him from all of the movies he was already in.
 
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ManofOne

ManofOne

Plus Member
Zefah said:
Surely they could have handled this differently, though?

Temporarily disable margin, temporarily disable grace period on fund deposits, etc. Make sure they are only trading with real money (lol) that already safely cleared the banks.

They said they shut down trading of specific stocks due to volatility to protect their customers. It was bullshit. It's not like stocks having meteoric rises is necessarily a foreign concept on Wall Street. I don't buy that they simply would have not been able to cover this. Their situation is far more dire if that's the case, no?
Click to expand...

I'm just guessing b/c I'm not entirely familar with the brokerage business but if let's say 80.0% of Robin Hood traders were trading GME. That would have exposed the brokerage firm to "long tail" risk where those investing in GME shared the same risk exposure. Their liquidity provider (lets say JP Morgan) would want to reduce counter party risk. If there is negative equity by a a majority of those traders then the company is on hook to the liquidity provider.


I am guessing here. I have no clue how it works.

The primary purpose of the Net Capital Rule is to ensure that registered broker dealers maintain at all times sufficient liquid assets to promptly satisfy their liabilities (claims of customers, creditors and other brokers) as well as to provide a cushion of liquid assets to cover potential market, credit and other risks should the broker be forced to liquidate. The rule achieves this purpose by prescribing a liquidity test that requires the broker dealer to maintain the greater of a specified minimum dollar amount or a specified percentage of net capital in relation to aggregate indebtedness (which include most liabilities) or customer related receivables.


To comply with the SEC’s net capital rule, broker dealers must perform two computations: One determines the broker dealer’s net capital (liquid capital) and the other computation determines the broker dealer’s appropriate minimum net capital requirement. This process of computing net capital is really about separating liquid and illiquid assets. Starting with ownership equity, the firm deducts the value of all its illiquid assets as well as operational charges for delays in promptly settling securities transactions to arrive at a firm’s Tentative Net Capital. This figure is then reduced by “haircuts” on securities positions which are percentage deductions of a securities value based upon type and maturity. It is only after deducting these “haircuts” that you arrive at the firm’s net capital.


This net capital position then gets compared with the firm’s net capital requirement which, as stated previously, is either based upon a minimum dollar amount, a percentage of Aggregate Indebtedness or a percentage of customer receivables. The resulting difference between Net capital and required net capital is called excess net capital.
Click to expand...
 
ManofOne

ManofOne

Plus Member
Dunki said:
let me use this tweet again:

Click to expand...


They were lol. See my post above.


What I said is

I'm just guessing b/c I'm not entirely familar with the brokerage business but if let's say 80.0% of Robin Hood traders were trading GME. That would have exposed the brokerage firm to "long tail" risk where those investing in GME shared the same risk exposure. Their liquidity provider (lets say JP Morgan) would want to reduce counter party risk. If there is negative equity by a a majority of those traders then the company is on hook to the liquidity provider.
Click to expand...
 
Last edited:
D

Dunki

Member
ManofOne said:
It seems Steve Cohen is saying the same thing, I was saying earlier. A lot of people trading on margin.

Click to expand...

HE JUST said that he did it t "protect" their customers and there were no liquidity problems.

This is SUCH BULLSHIT
 
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D

Deleted member 17706

Unconfirmed Member
ManofOne said:
It seems Steve Cohen is saying the same thing, I was saying earlier. A lot of retail investors trading on margin.

Click to expand...


So why not just disable margin trades? Make people have the money clear their accounts to use on these "risky" stocks. Surely their platform can differentiate between that... I would hope.
 
ManofOne

ManofOne

Plus Member
Zefah said:
So why not just disable margin trades? Make people have the money clear their accounts to use on these "risky" stocks. Surely their platform can differentiate between that... I would hope.
Click to expand...

Well what about the people who are the hook already. As I said I am speculating here but the brokerage firm is subjected to net capital rules. So they borrow money from liquidity providers. They lend that money at a higher cost to

account holders and then the account holders trade. But if all the account holders share the same exposure and are trading on NEGATIVE EQUITY, then I can see why they shut down the trading.

I am guessing here. If anyone has a better answer lemme know. THIS IS VERY INTERESTING.
 
D

Deleted member 17706

Unconfirmed Member
haxan7 said:
robinhood CEO just compared buying GME to buying Clorox and Lysol during the pandemic.

dunno wtf he’s on about tbh
Click to expand...

Truly disheartening to see that such a moron is in charge of this otherwise well done app and business idea. Oh well, I'm cleaning my hands of it forever.
 
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