After the Robinhood incident, lets discuss how they make money - what this means for the company - and how this might affect their potential IPO. Enjoy! Add me on Instagram: GPStephan
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In terms of how Robinhood makes money, it’s a little uncertain since they’re not a public company…but, it’s estimated they earn their money from their 6 million users in a few ways:
One: They make money from their Robinhood Gold service, starting at $5 per month, which offers you additional features, like margin trading, level 2 market data, research reports, etc.
Second: They charge a 5% interest rate on their margin accounts
Third, they make money from un-invested cash you have sitting on their platform.
Fourth, and probably the most controversial…is that Bloomberg says that almost half of Robinhood’s revenue came from a practice of routing order flow…
https://www.bloomberg.com/news/articles/2018-10-15/robinhood-gets-almost-half-its-revenue-in-controversial-bargain-with-high-speed-traders
This is pretty much the practice where Robinhood itself doesn’t execute the stock trade, but they instantly outsource it to another company that pays for the right to execute those trades. Those firms usually earn a very, very small percentage off the trade…according to Bloomberg, that was $0.0024 cents per share,” but with $150 billion in trading volume, it adds up.
https://outline.com/zwzzVm
Besides that, they’ll make some eventual interchange fees with their cash management debit card, and I’m sure they have a few other things in the works…but I have no clue whether or not they’re actually a profitable company, and what they plan on doing to eventually expand into banking and lending services, etc.
In terms of where we go from here…well, IDEALLY, Robinhood fixes the glitch and sweeps it under the rug - and then keeps a close eye on for anyone else trying to exploit any faults or glitches within the system.
Like I said…mistakes and glitches happen, no one expects Robinhood to be perfect. But how they handle those mistakes is going to be an indication of how they’ll handle FUTURE issues, as well…which is inevitable, and it happens to every business out there.
I wouldn’t be surprised if Robinhood - and many of the other brokerages out there - changed the way Margin Accounts are handled. Realistically, there’s no rational reason why everyone is given the same access to margin…because if you have $2000, agree to pay for Robinhood gold, and a 5% margin interest rate, you can borrow up to 50% of your purchase to invest. In NO other industry would you be able to do that...so it doesn’t make sense that this would be the case for an asset like stocks, at least without a little more thorough background check.
Finally…let me say this. I have nothing against Robinhood, I use them, and I think they’re an overall great platform. If it wasn’t for them, I bet NONE of us would be seeing free stock trades today - we almost certainly owe that to them, and they’ve absolutely shaken up the entire industry in such a great way.
For business or one-on-one real estate investing/real estate agent consulting inquiries, you can reach me at GrahamStephanBusiness @gmail.com
The YouTube Creator Academy:
Learn EXACTLY how to grow an audience, rank videos on the front page of searches, build your brand, and turn that into another income source: https://bit.ly/2STxofv $100 OFF WITH CODE 100OFF
Get 2 Free Stocks on WeBull when you deposit $100 (Valued up to $1000): https://act.webull.com/k/Vowbik9Tm5he/main
My ENTIRE Camera and Recording Equipment:
https://www.amazon.com/shop/grahamstephan?listId=2TNWZ7RP1P1EB
My second channel:
http://www.youtube.com/c/thegrahamstephanshow
In terms of how Robinhood makes money, it’s a little uncertain since they’re not a public company…but, it’s estimated they earn their money from their 6 million users in a few ways:
One: They make money from their Robinhood Gold service, starting at $5 per month, which offers you additional features, like margin trading, level 2 market data, research reports, etc.
Second: They charge a 5% interest rate on their margin accounts
Third, they make money from un-invested cash you have sitting on their platform.
Fourth, and probably the most controversial…is that Bloomberg says that almost half of Robinhood’s revenue came from a practice of routing order flow…
https://www.bloomberg.com/news/articles/2018-10-15/robinhood-gets-almost-half-its-revenue-in-controversial-bargain-with-high-speed-traders
This is pretty much the practice where Robinhood itself doesn’t execute the stock trade, but they instantly outsource it to another company that pays for the right to execute those trades. Those firms usually earn a very, very small percentage off the trade…according to Bloomberg, that was $0.0024 cents per share,” but with $150 billion in trading volume, it adds up.
https://outline.com/zwzzVm
Besides that, they’ll make some eventual interchange fees with their cash management debit card, and I’m sure they have a few other things in the works…but I have no clue whether or not they’re actually a profitable company, and what they plan on doing to eventually expand into banking and lending services, etc.
In terms of where we go from here…well, IDEALLY, Robinhood fixes the glitch and sweeps it under the rug - and then keeps a close eye on for anyone else trying to exploit any faults or glitches within the system.
Like I said…mistakes and glitches happen, no one expects Robinhood to be perfect. But how they handle those mistakes is going to be an indication of how they’ll handle FUTURE issues, as well…which is inevitable, and it happens to every business out there.
I wouldn’t be surprised if Robinhood - and many of the other brokerages out there - changed the way Margin Accounts are handled. Realistically, there’s no rational reason why everyone is given the same access to margin…because if you have $2000, agree to pay for Robinhood gold, and a 5% margin interest rate, you can borrow up to 50% of your purchase to invest. In NO other industry would you be able to do that...so it doesn’t make sense that this would be the case for an asset like stocks, at least without a little more thorough background check.
Finally…let me say this. I have nothing against Robinhood, I use them, and I think they’re an overall great platform. If it wasn’t for them, I bet NONE of us would be seeing free stock trades today - we almost certainly owe that to them, and they’ve absolutely shaken up the entire industry in such a great way.
For business or one-on-one real estate investing/real estate agent consulting inquiries, you can reach me at GrahamStephanBusiness @gmail.com
To Graham Stephan : sir indians also can invest in this
All I know is tsla dropped to 700 🙄 Robinhood is the time
Hey grant, where’s your financial blog
Hey there!
Love your videos. Just pitching you an idea on used car dealership stocks, particularly $SFT and $VRM, since ongoing supply constraints are boosting used car sales and prices, plus as consumers switch to EVs they need to sell their used cars.
Worth checking out, potential dip buy.
I just use Fidelity and E Trade.
An investment in knowledge pays the best interest."
Robinhood is super simple and I only invest in ETF’s right now since I’m new to the stock market.
Why does he look like a dwarf? Bad camera lens?
I hate Robinhood won't let me get a credit for a debit spread. If I search the options and find a deal I should be able to execute it. They also will not let you do a credit spread with no risk.
Using this service maskoffweb team make me happy they got me 13,000 thousand dollars PayPal hack transfer today
Damn the rich are so rich they don’t even know there’s a reality on the internet that’s deep.
Not a fan of these apps, can be a lot more successful and safer with things like Forex with EagleFX.
I just bankrolled my forex portfolio with a good amount of ethereum where permissible and definite management like Austin’s trading group ATG @surefiredaytrading on îńśtågram handles and monitor my trade while I decode these procedures and still win even at grim rates , tbh if you don’t own some couple of digital finances at the moment, I don’t know what method of financial growth you trust then. All that’s needed is a substantial forex enthusiast to monitor you on this so as not to risk your whole passion for this and it all comes abortive
I just bankrolled my forex portfolio with a good amount of ethereum where permissible and definite management like Austin’s trading group ATG @surefiredaytrading on îńśtågram handles and monitor my trade while I decode these procedures and still win even at grim rates , tbh if you don’t own some couple of digital finances at the moment, I don’t know what method of financial growth you trust then. All that’s needed is a substantial forex enthusiast to monitor you on this so as not to risk your whole passion for this and it all comes abortive
Hyperiontrust?
It seems like my stocks gain but my accounts worth stays the same.
I don't know why, but that indoor plant is triggering me
I count myself as a successful trader because of the amazing trading strategy of Mrs Loice Martha, considering the huge profits generated 20% commission seems very fair
Just started out near the end of 2020 when I turned 18, Robinhood made me develop a new dream of accomplishing passive income with fun 🚀
LISTEN FAMILY….. you really interested in making money and owning your investments???? GET AT ME!!!! @brittbloch I love to help people quit their 9-5
When you are ready to move from amateur to pro get at me!!!
since I start investing with this company I have been living a better life. Geting my profit for my investment today is exciting. Thanks to AUTOMATE company.
I was a big fan of Robinhood account until I got logged out of my account but thanks to Leo_de_hack on Instagram who helped me gain permanent access into my robinhood account all thanks to the great hacker..
BEWARE!!!! THEY WILL SCREW YOU OVER! I SOLD DOGE AT .15 AND BOUGHT IT BACK AT .14 AND NOW ITS BEEN PENDING OVER 24HRS AND DOGE IS UP AT .24…………..
Can you tell me why they took 16 dollars of my 100 deposited? Stated it as “rewards”.
Thanks.
I'm so happy right now I got my credit cards from Sureboss20 on telegram it's real and legit 💯….
+/ 1/ 6/ 4/ 6/ 5/ 1/ 3/ 9/ 6/ 4/ 9
Binary options trading investment guidance and recovery
Robinhood doesn’t allow you to have beneficiary or give you the option to do so.
NOTE: I get it, 2 Robinhood videos in a row. Don't worry, just figured it was an interesting topic to cover and it was time-sensitive, so I figured I'd rather get it out this week than wait for any of this information to be out dated. Normal content as usual coming next week.