For Subscribers

Happy Robinhood IPO Day, Suckers! Alphacution Publishes “The Robinhood Effect”

In this 193-page, 272-exhibit, 30,800-word case study, “The Robinhood Effect,” Alphacution brings together data and modeling from 25 entities – 11 retail brokers and 14 wholesale market makers – to explain a new phenomenon that now lives at the center of the US capital markets ecosystem. Alphacution’s most ambitious research project to date, this report covers the governing liquidity economics framework that defines PFOF rates, the mechanics of Robinhood’s aggressive retail brokerage model, the transformation of the retail brokerage industry, the sophisticated strategy architectures of wholesale market makers, and the “retail flow factors” that impact all market actors in the ecosystem – among many other themes and avenues for future research. An executive summary is available for review and download by open subscribers (w/ free registration). The complete case study is available to premium subscribers or via individual report purchase.

By |2021-07-29T02:56:14-04:00July 29th, 2021|For Subscribers|

The Retail Flow Factor: Hiding in Plain Sight

In this introduction to the 17-page, 21-exhibit presentation – Part III of Alphacution’s case study on payment for order flow (PFOF) – we present our preliminary development of the “retail flow factor” for 2020 based largely on a reconciliation of 606 data (from 10 retail brokers / 11 entities) and 605 data (from 7 wholesale market makers). The results include estimated monthly penetration of retail order flow relative to the full U.S. cash equities market for 2020 – including estimated breakdowns of odd lots and round lots – as well as some hints on where we will need to look next to further refine this factor in preparation for extending this analysis throughout 2021 and beyond…

By |2021-06-03T01:03:27-04:00June 3rd, 2021|For Subscribers|