Robinhood’s Dirty Little Secret
Alphacution makes its case for where new market structure rules should, at the very least, be successful - as well as a clue for how our research influenced (and altered) Robinhood's business model...
The Mother of All PFOF Charts – Q3 2022 Edition, Part II
Part II - Equity PFOF Volumes / Wholesaler Market Shares: Alphacution organizes and distills 33 months of payment for order flow (PFOF) data from 14 retail brokers and 13 wholesale market makers to place a wide-angle frame around the US Securities and Exchange Commission's upcoming proposals for a major equities market structure overhaul...
The Mother of All PFOF Charts – Q3 2022 Edition, Part I
Alphacution organizes and distills 33 months of payment for order flow (PFOF) data from 14 retail brokers and 13 wholesale market makers to place a wide-angle frame around the US Securities and Exchange Commission's upcoming proposals for a major equities market structure overhaul...
Fork It! UBS Securities Exiting Retail Wholesaling
We've seen it coming for a long time. There were many clues along the way from which to anchor a prediction. Now, the evidence is too dramatic to ignore: UBS Securities is exiting the retail equity wholesale market making business. Alphacution rolls out its case, along with other key findings...
Robinhood’s Anniversaries: Buying Rumors, Selling News
Late January 2022 coincided with Robinhood's Q4 2021 earnings release and two very important anniversaries. Alphacution commemorates these milestones with the following analysis...
Retail Equity Option Flows: Finding a New Limit?
Alphacution updates its "retail option flow factor" analysis, in part, as preparation for Robinhood's upcoming Q3 2021 earnings release...
Pulling Your Strings: How Retail Brokers Influence Trading Behavior (Or Not), By Design
Alphacution adds to its library of evidence that retail brokerage platforms specifically decide how, when, and if to influence the trading behavior of their clients...
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...
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 [...]
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 [...]
