Said it once before: do not link your bank account on RH with Plaid (i.e. bank login). Plaid is the API they use that includes access to your account balance and entire transaction history! (https://plaid.com/products/transactions/)
Hey! Co-founder of Plaid (plaid.com) here. RH does not pull your transaction history, RH is only using Plaid to authenticate your ACH accounts to make sure your actually the owner of the account and so you don't get over-drafted. They're using our auth and balance product, feel free to check out what information we return on our docs (http://plaid.com/docs).
Agreed there is no transparency around which endpoints are being used. There needs to be a screen that shows what data you’re providing like FB or Google login before you link anything.
I don't see what's specific to Plaid here. When you give your bank login information, that means they can see whatever is accessible via that login. You should always expect this no matter whom you're giving your login information to, or why.
Obviously if you are using a Mint-like application where it's clear you are sharing your transaction history then it should be expected, but on RH there is no obvious utility to sharing transaction data when linking a bank account only serves to transfer money in and out of a brokerage account.
As far as I can tell, a single Plaid token enables a developer to "turn on" any endpoint they offer without consent from the user, so even if RH does not pull transaction history now (I would like confirmation from them directly) they've obviously written their PP in a way that lets them flip a switch anytime they want without anyone knowing.
Plaid is an interesting company from a developer POV, but it's clear to me they've taken the early FB approach to their API and have extremely little control or visibility into what developers are doing with the data. They also do not show a confirmation screen with the data elements they're asking for from the customer before confirmation.
I hope they get their act together before we see them in the news because someone bought Plaid transaction data from millions of customers to target ads for the 2020 election. Purchase history on millions of voters would be incredibly powerful (even more so than likes IMO) as far as targeting goes.
Anybody worried about this should probably just open a checking account specifically for uses like this. We tend to talk about "your checking" account, as though you can only have one and it's somehow your official account. But, despite these weird notions we seem to have about them, checking accounts are just like any other consumer product.
You can have as many as you want with as many banks as you want; they've very easy to open online.
This shouldn't be a significant barrier for anybody on this forum.
Kudos to the product guys. They have figured out the demographic of their product with clinical precision. In Last 6 months, I have used RH app lot more than FB. Nothing is as addictive as using leverage to trade options and Crypto.
I have no comment on crypto but if you're "addictively" using leverage to trade options, I hope you're only playing with your throwaway money. You are practically bound to lose money to institutional investors when playing with options.
I’d argue that if you’re playing with options on industries or companies you know well (not your employer though) you may even have an edge over institutional investors. Unfortunately it’s not possible to buy calls on pre-IPO companies though
Do most non-institutional/non-professional traders even know how to price options other than some gut feel? Are they familiar with Black-Sholes and the Greeks? From my personal experience most of them don't. Plus to properly model these things requires quite a bit of research and calculations. At the hedge fund where I worked, there were well over 600 top of the line Xeon servers running to constantly pull in data and crunch the numbers. This was in the early 2000s. Things are probably even more lopsided now. Trading and finance are professions in the same sense software engineering is (there's quite a bit of overlap in skills too). Unless you're a professional who has the time and resources to do it, you're at a severe disadvantage and are going to lose in the long run.
One possibility is getting leverage via deep in the money options, which are very easy to price. But I guess that's not what most people are talking about.
But also, spreads are pretty tight for close dated near the money options. Just assume the price is right, pick a direction, and trade...
Every time I hear "democratize" financial system from a FinTech or blockchain "company" it immediately raises alarm bells. Usually it's a euphemism for democratizing investor exploitation.
I completely agree, and that also does not make those securities "investments". Additionally, even someone who "invests" (literally "putting clothes onto") into an account at Ally bank for 1.4% interest per year or something is still speculating on a few things-- namely that Ally will remain solvent and that their security measures are sufficient enough to ensure you will get your money in and out without much problem.
Bitcoin certainly is more speculative than GE stock, but look at GE's stock performance and dividend performance. Anyone who thought they were investing into the long term value of a major American company was actually speculating as to whether or not a blue chip stock could produce cash flow and maintain the value of real assets, which, they couldn't do so as well as they did 20 years ago.
I signed up for Robinhood earlier this year and provided all my personal info including SSN but was notified afterwards that cryptos were not available for trading in California.
RH Privacy Policy: https://d2ue93q3u507c2.cloudfront.net/assets/robinhood/legal...