praguepride:
I know that story is circulating but it seems far more likely that they were margin stocks, not owned stocks. I am not an expert in any of this stuff but the internet is saying make sure you set your brokerage accounts to "no margins" because otherwise you can basically let your broker sell your stock for you for (reasons).
That's because margin stock isn't actually ownership, it's purchasing into a "percentage" of a stock that the
company owns, they're just letting you ride their coattails on that stock. (basically)
quote:
There is almost zero chance that stock was legit owned in hand and Robinhood just went up and took it.
Some sources are saying that
if it is true, it would have been to cover their own positions, which would be legal purely because of the TOS of the platform, but would now go to arbitration to determine how much Robinhood owed (above and beyond sale price) the customer for selling out from under them.
Which
if true will suck for those customers.
But I agree with you, which is more likely? A whole bunch of Joe Sixpack customers failed to understand their own stock positions and the type of buyer accounts they had with Robinhood (etc) and are now making outrageous claims and pissing up the wind, or that Robinhood (etc) had to sell out customers to cover themselves in the short, and cost themselves money, prestige, and trust in the long.
The first disrupts those companies right now*, the second could cause them to shut their doors for good.
* And breeds slightly savvier Joe Sixpack investors. At the least some people got 'burned and learned' to read user agreements and account settings. But I know how people operate, so maybe 1 in 5 learned something yesterday... the rest are reaching right back into the fire.