TD Ameritrade

Now You See Me: What The Bloomberg Opinion Guy Misses About Market Structure Mechanics

Leveraging numbers and narrative, Alphacution builds a higher-dimension analysis of market structure mechanics on top of Bloomberg Opinion's Matt Levine's recent manifesto on payment for order flow (PFOF). Disclaimer: No unsolicited elbows were thrown during the creation of this Feed post...

By |2021-03-04T19:37:16-05:00February 22nd, 2021|For Subscribers|

A Very Tasty Trade

"What's really happening here is that instead of people becoming engaged in finance when they're 40, 50, 60 or whatever, they're finally starting to learn that - hey - this is really cool. And so, we have an entire generation now which is not only going to support capitalism, it's going to accelerate the growth in free markets and [provide] massive amounts of liquidity so that everybody out there is going to benefit. This is the best thing to happen to the global economy in three or four decades. Getting millennials engaged in finance is transformational."Tom Sosnoff, co-founder, Tastytrade; on CNBC Squawk Box, January 29, 2021 in response to a question about the "democratization of finance" and the status of capitalism With all the craziness this week around GameStop, Robinhood and the whole STONKS meme, an event from last week is at risk of being swept under the rug. So, I wanted to add this one to the Feed as a marker before we lose the thread entirely. Here's the [...]

By |2021-07-27T17:41:45-04:00January 29th, 2021|For Subscribers|

Outlook 2021: The Drunk-on-Impunity Mania Arrives

"You cannot escape the responsibility of tomorrow by avoiding it today."Abraham Lincoln With protestors storming the U.S. Capital - some of which breaching the outer doors and freely strolling the U.S. Senate floor - as surreal and unprecedented backdrop, I sit down to organize a sketch of Alphacution's outlook for the year ahead, starting with a very wide lens: The U.S. economy - much like the rest of the other "developed world" economies - is naturally weaker than the meticulously curated employment and productivity numbers suggest. Technology adoption (from workflow automation to social media distraction), growing debt burdens, ossified resource allocation practices, cross-region labor arbitrage, deteriorating infrastructure, and other factors all converge to deteriorate "life, liberty and the pursuit of happiness" for a growing portion of the population. The COVID pandemic of 2020 - and however long it remains disruptive throughout 2021 as vaccines are being rolled out - acts as an accelerant of many of these factors. Ours is a deteriorating version of capitalism. Symptoms emblematic of the stage [...]

By |2021-01-06T23:36:37-05:00January 6th, 2021|Open|

Daily Average Fugazi’s: Robinhood Postures for IPO

“Name of the game? Move the money from your client’s pocket into your pocket. Number one rule of Wall Street: Nobody knows if the stock is going up, down, sideways or in … circles. It’s all a fugazi…“ – Mr. Hanna, Wolf of Wall Street On Monday, August 10 at exactly 11am EDT (you know, after the opening bell was safely in the rearview mirror), Robinhood Markets, Inc. – the anti-incumbency insurgent trading app platform and self-proclaimed democratizer of all things financial – set out to dominate the week’s financial news cycle by enticing media powerhouse, Bloomberg, to drop a news bomb into an ecosystem already negligently over-stimulated on the topic: “Robinhood Blows Past Rivals in Record Retail Trading Year.“ One piece of data was exclusively revealed to Bloomberg at the center of this story: 4.31 million daily average revenue trades – commonly known as DARTs (and generally defined as customer orders executed divided by trading days) – were recorded in June with the additional explanation that “the firm is revealing the data for the first time, [...]

By |2020-10-02T15:34:20-04:00August 13th, 2020|For Subscribers|

TD Ameritrade’s Q2 Update: To Infinity or Oblivion?

"Just when I thought I was out, they pull me back in." - Michael Corleone, The Godfather: Part III   Chicken or egg? For today's story, we know which one came first. However, we may never know for sure which one was the more prominent cause of the recent sustained spike in US stock volumes: A frictionless environment brought on by a zero-commission framework or a high-volatility market brought on by a once-in-a-century global pandemic? Granted, there may be additional factors at play here. Like the gamification of market interfaces as substitution for a sports apocalypse. People need something to do. And, when confined for extended periods, they will naturally choose paths of least resistance, especially those that entertain, are addictive and tickle financial desires... This is what one of those paths looks like; notably since March 2020: Now, I made a point last week, in "Robinhood's Trailing Stop Orders: Extreme Profitability, By Design," to say that we would try to avoid seeming redundant in our topical choices, at least [...]

By |2020-08-17T07:14:01-04:00July 23rd, 2020|For Subscribers|

Robinhood’s Trailing Stop Orders: Extreme Profitability, By Design

"They make it so easy." - Richard Dobatse, Robinhood user (via New York Times) "A fool and his money are soon parted." - Thomas Tusser, poet   Imagine if you knew, ahead of time, exactly what bait to use? Not only which bait to attract and influence the behavior of specific customers, but how to package the output of those behaviors - into an additional form of bait - in such a way as to leverage US listed market structure and maximize the probability of financial windfall. If so, chances are, you would share some of the vision that the founders of retail trading app and rising zeitgeist symbol, Robinhood, did circa 2013... Now, the fact that Alphacution has been beating this drum for four weeks in a row (starting here, here and then here) is unintentional and unrehearsed. Certainly, we much prefer that our riffs come with a level of variety - and we will return to that variety shortly. However, as we have been grinding the numbers around order [...]

By |2021-01-04T15:28:30-05:00July 15th, 2020|Open|

From Citadel Securities to Tastyworks: The New Economics of Liquidity, Part 1

"The real voyage of discovery consists, not in seeking new landscapes, but in having new eyes." - Marcel Proust   The data contained in the revised SEC Rule 606 reporting has landed like a transparency bomb for those few of us who try to make sense of complex - and historically opaque - market structure issues; perhaps even more so for those fewer of us that are able to triangulate on the strategic movements of the various players by weaving additional insight from multiple datasets. Add the moves of the largest retail brokerage platforms, in particular, to a zero-commission paradigm off the back of the controversially-successful Robinhood platform, and we have a potent cocktail made of disruption and intrigue. For those of you that have been following along recently, Alphacution has toggled widely between intense fixation on these themes - with our latest Robinhood-related Feed posts, "Phenomenon: On This Score, Robinhood Now Exceeds E*Trade, Others" and "Trick Shot: Robinhood Underwrites MEMX" and our recent contributions to the July 8 New York Times [...]

By |2020-10-14T21:46:52-04:00July 9th, 2020|For Subscribers|