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@AskRobinhood
#RobinhoodTraders #robinhood

The free stock trading app valued at $11.2 Billion is the hottest Stock broker in the world in 2020
With 10 Million active users and record 4.31 million daily average revenue trades recorded in June 2020
it’s clearly the Saas business of the year 2020.
But the big news is Robinhood “doesn’t charge fees”
It offers commission free stock, ETF and options trades
How does Robinhood earn its revenue if it doesn’t charge its customers to buy and sell and trade equities
Robinhood sells the retail order flow to high frequency traders (HFT) and Market Makers
Market makers make money on the spread between the bid and the ask
Market makers provide liquidity to the market, which means they take the other side of trades.
These traders could then use HFT algorithms to frontrun the trades, which would massively accentuate the retail momentum.
@CSCareers ( citadel securities) and @VirtuFinancial ( Virtu Financial Inc) are the two biggest market makers who buy retail orders from Robinhood
The company generates significant income from payments for order flow, a common although controversial practice whereby a broker receives compensation and other benefits for directing orders to different parties for trade execution.
Robinhood refers to this revenue as "rebates from market makers and trading venues.
Independent analysis suggests that payments for order flow generated an estimated $69 million in revenue for Robinhood in 2018
Robinhood PFOF ( payment for order flow) business probably brings in around $150M - 250M annually.
A company that directs billions of dollars in trades to market makers can earn substantial amounts.
Robinhood payment for order flow was $180.1 million for Q2 2020 , double what it took for the prior three months, according to a regulatory filing
and it expects revenue to hit $700 million this year, a 250% spike from 2019.
Robinhood has sold the world a story of helping the little guy that is the opposite of its actual business model: selling the little guy to rich market operators with very sharp elbows.
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More from @srinicaps see all

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Srinivasan G
@srinicaps
One of the largest #loans #restructuring exercises in Indian banking history will kick off in Sept 2020 till March 2021
Let’s see how Modern banking system actually works
#Banking is all about lending activities, if they practise good lending via various advances methods Image
as approved by the #Regulators they are good businesses or else they can go bust
modern banking system is based on the fractional reserve system
What does fractional reserve means
1) People deposit their savings in the bank in the hopes of earning #interest rates
2) The bank turns around and lends out the vast majority of that deposited money or the bank invests it in other financial instruments (sometimes sound, more often reckless or even toxic) in an effort to make a profit
In other words, banks keep only a small fraction of depositors
Read 17 tweets
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Srinivasan G
@srinicaps
The #Fed wants #inflation

The single biggest issue for the world today is that there is too much debt in the financial system
Globally the debt to GDP ratio is 322%
Amongst G-7 nations, the numbers are striking
The U.S.’s Debt to GDP is 106%
Germany’s Debt to GDP is 61%
Japan’s Debt to GDP is 236 %
The United Kingdom’s Debt to GDP is 85%
Canada’s Debt to GDP is 89%
France’s Debt to GDP is 98%
Germany is the only country that has been aggressively paying down its debt
Germany’s debt to GDP skyrocketed to 82% as its economy collapsed
Now there are three ways to deal with excessive debt

1) Pay it off through growth or fiscal restraint.

2) Default/ restructure

3) Attempt to inflate it away by debasing your currency
Read 7 tweets
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Srinivasan G
@srinicaps
#PMCBank is just another chapter in Banking frauds across many countries , every few years investors get duped irrespective of such fabulous efforts by thinkers to guide the citizens ,

why it happens again ?
Customers are moved by the persuasion, friendly neighbourhood system,
one to one approach, working staff themselves are not aware what’s happening in the top deck , it’s a 9 to 5 job finally, Govt has kept information, technology and infrastructure away from the working class to a very good limit and hence the awareness is very limited
to bank with a clean and clear institution
Many current accounts are opened with large amounts at any given time because of OD , credit facilities, etc
It’s very important to educate the working class and daily wagers to be very responsible to bank only with decent and graded
Read 7 tweets

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