
Robinhood raises $323M at a $7.6B valuation - tempsy
https://www.reuters.com/article/us-robinhood-funding/trading-startup-robinhood-raises-323-million-achieving-7-6-billion-valuation-idUSKCN1UH1VX
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mattferderer
I'm curious if anyone with knowledge can speak to how Robinhood sells data to
high frequency traders?

This seems to result in a large percentage of their revenue which of course
makes sense due to not having commission revenue.

I've also heard some people argue if you're investing a decent amount, you're
better off with commissions over market orders on Robinhood. The arguments
were the above & that orders can take a much longer time to process. Though I
imagine most small investors are not to concerned with either.

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kvna
The only issue I have had with Robinhood is regarding tax planning, because
they only support FIFO sell orders. There have been several instances where I
would have preferred to sell shares purchased more recently, so that my older
shares can pass the one year threshold for long term capital gains. The
ability to specify lots when selling shares would be worth money to me.

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rconti
Can't you use whatever accounting method you wish, regardless of how they
report it?

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adammenges
Yeah would love an answer here too

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bjacokes
When you sell shares, cost basis is reported to the IRS by the brokerage. The
parent comment suggests that RH always reports the FIFO cost basis, i.e. price
of the first shares you bought as opposed to the last shares. There are places
on tax forms where you can adjust your cost basis up or down from the one
reported by your brokerage, but (without doing any research into it) I doubt
that "I don't want to use my brokerage's cost basis method" is a valid reason
to use those.

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rconti
I really have no idea, but it's a VERY new thing that brokerages even report
this information. The 1099-B can't be more than a decade old. You used to have
to track it all yourself. I suspect you can use your own cost basis method.
(subject to rules; of course you have to be consistent)

That said, this is definitely not tax advice, and even if it's
legal/allowable, you're almost certainly more likely to be audited if your
numbers don't agree with what the brokerage reports.

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tanderson92
This is why Form 8949 (column (f)) exists.

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swampthinker
Brings their total to $828M raised since 2013. I'm honestly surprised they
haven't taken money from the Vision Fund yet.

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dopamean
that'll be for when they raise a billion and a 20 billion valuation

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AznHisoka
I've been using Robinhood for the past year, and I hope they add basic
features such as:

\- The ability to short a stock, which I still can't believe isn't available.

\- Price Alerts

Everything else is gravy, IMO, especially if they keep the same basic, sleek
interface, which I actually like.

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throwaway5752
Is there a way to allow shorts without having to manage margin and having to
carry risk on the balance sheet? They have to deal with two counterparties
(you, and whomever is lending you the shares). I am not sure how they could
economically offer free short trades.

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stephengoodwin
Not that I'm aware of. The only alternative would be to permit shorting if the
user has a Long Put for defined risk protection.

You could always to a synthetic short through buying a Long Put, but time (and
often volatility) decay become a factor (for shorter term trades).

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stephengoodwin
Correction: Should be Long Call for the first scenario: defined risk
protection (for shorting), not Long Put.

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gigatexal
This is great! Now I wish they would open up trading for IRAs

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elamje
I am confident that everyone’s IRA would be better kept by Acorns.

Robinhood encourages getting in and out of positions to frequently.

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MuffinFlavored
I'm confident that everyone's IRA would be better kept in a low-cost mutual
fund that tracks a popular index.

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elamje
That’s exactly what Acorns does. Only uses Vangaurd popular indexes.

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MuffinFlavored
but they charge a fee on top :) it's small, but it basically abstracts away
the underlying investment vehicles. it causes Acorns to be a blackbox.

"welp, I don't know where my money is going, it's just going into the Acorns!
They handle it all for me!"

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elamje
I don’t mind it. Personally I find that it gives an incredible amount of
dollar cost averaging, since as little as $5 gets invested at a time. All
transaction fees are included with the $1-$2 a month.

Additionally it’s not a black box because you get to select from 5 options
that explicitly show the exact allocation and which ETF it goes to.

To each his own, but I find that it takes away a lot of the psychological
thought of investing in a cost effective way. But the $1-2 a month can end up
being a large fee if you don’t have more than $10 or $20k invested.

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SergeAx
DST Global is a pocket of Russian oligarch Alisher Usmanov, alleged criminal,
Putin's sidekick, owner of Russian social network VK, which committed numerous
acts of personal information disclosure to police and FSB without court order,
led to prosecution of political activists and common people. Good luck, Robin
Hood (

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rolltiide
well the money is clean now and Sequoia followed the lead, so nobody important
cares about that, lets stop spending resources on whitelisting monetary
transactions to begin with.

the audacity to try to limit capital flows based on owner behavior was always
misguided. if you disagree with something Alisher did, then you have to indict
the people that actually did it. vilifying money is just lazy.

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SergeAx
Of course the money is clean now, that's the sole purpose of DST Global.

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rolltiide
and how many six figure salaries has that provided for? how much contribution
to FOSS by for-profit company employee participation?

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dang
Url changed from [https://www.theblockcrypto.com/tiny/robinhood-raises-
valuati...](https://www.theblockcrypto.com/tiny/robinhood-raises-valuation-
to-7-6-billion-receives-323-million-in-funding/), which points to this.

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QuackingJimbo
Robinhood is a predatory lending scheme. The vast majority of its users should
not be trading anything other than indexes.

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almost_usual
It's everyone's right to shoot themselves in the foot with dumb financial
decisions. Robinhood isn't doing anything egregious here, they're only
reducing friction and fees.

I've used the app sparingly in the past with "fun money" but haven't done
serious investing with it.

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elliekelly
> It's everyone's right to shoot themselves in the foot with dumb financial
> decisions.

The industry regulations would indicate otherwise. Generally, the “dumber” the
money, the more regulatory protections that will apply. At their core,
financial regulators are consumer protection entities.

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almost_usual
Nothing is stopping anyone from putting their life savings into a legal dumb
investment. Regulators and the government sure won't stop you from liquidating
your 401k early. At some point common sense comes into play and you need to be
smart with your money.

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mywittyname
The US SEC has accredited investor requirements specifically to keep people
from being fooled into making "dumb" investments.

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almost_usual
>US SEC has accredited investor requirements specifically to keep people from
being fooled into making "dumb" investments

What stops me from liquidating my 401k and investing all of my money into a
company that misses their earning goals this week? Where does the US SEC come
into play here?

