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The Almighty Buck

Robinhood Launching 24-Hour Weekday Stock Trading (forbes.com) 43

Posted by BeauHD from the that's-a-first dept.
Robinhood announced Wednesday that it will soon allow users to engage in 24-hour trading of select exchange-traded funds and stocks. As Fortune notes, this "will make it the first U.S. brokerage to provide overnight weekday trading in individual stocks." From the report: The 24-hour trading service will allow round-the-clock trading in 43 securities between 8 p.m. ET Sunday and 8 p.m. ET Friday, with plans to add more securities at a later time, Robinhood CEO Vlad Tenev told the Wall Street Journal. The feature will roll out next week in a limited capacity and will be available by June to all users, according to the Journal.
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Robinhood Launching 24-Hour Weekday Stock Trading More

Robinhood Launching 24-Hour Weekday Stock Trading

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  • Why not? (Score:3, Interesting)

    by bradley13 ( 1118935 ) on Thursday May 11, 2023 @07:02AM (#63513539) Homepage
    Honestly, I don't understand why trading hasn't long since been 24/7. Be assured that the big boys trade whenever they want - and make their profits between market close and market open.

    • Re: (Score:3)

      by khchung ( 462899 )

      Honestly, I don't understand why trading hasn't long since been 24/7.

      Because

      1. In the wee hours during the night, the trading volume could get very low, making it easier to artificially push up or down the price to manipulate the market.

      2. Investment bankers also need to sleep, they started working before market opens and need to wrap up after it closes. Extending trading hours mean longer working hours for them. Exchanges do not want to piss off a significant portion of their customers.

      • Re:Why not? (Score:5, Informative)

        by tlhIngan ( 30335 ) <[ten.frow] [ta] [todhsals]> on Thursday May 11, 2023 @09:03AM (#63513753)

        Honestly, I don't understand why trading hasn't long since been 24/7.

        Because

        1. In the wee hours during the night, the trading volume could get very low, making it easier to artificially push up or down the price to manipulate the market.

        2. Investment bankers also need to sleep, they started working before market opens and need to wrap up after it closes. Extending trading hours mean longer working hours for them. Exchanges do not want to piss off a significant portion of their customers.

        Also #3 - to allow time for the market to process news. There are mandatory reports that companies must give - earnings and such. These are always held after hours because by law everyone has to get the same news at the same time and be given time to process it.

        It's why all earnings reports are held after the markets have closed (or before they open) so that by the time everyone hears the news, they can make their trades at the same time - i.e., when the market opens.

        Otherwise you'll have situations where companies may choose to release bad news at oddball hours to ensure a select few are able to cut their losses while other investors who weren't up at 2:38AM get creamed.

        So all news happens after hours, you can book your trades to execute when markets open next and let them happen because everyone queued them up. After hours trading is basically just finding contracts to trade after hours and having them executed at an agreed price when the market reopens.

        • Hmm that is incorrect. The big boys have had access to out of hours trading for a long time, so they can trade around earning calls even after the NYSE close. Liquidity is definitely not the same though.

          • You have the same access to after-hours trading as they do. Yes the US financial system is broken and corrupt but it's not because of secret trading markets exclusive to "the big boys" or naked shorts or any of the other boogieman excuses people parrot to rationalize their losses. It's because they were trying to participate in the broken corruption in the first place instead of trying to put a stop to it all.

            • No, the retail customer doesn't have access to all the after hours liquidity pools. I'm not saying they should, but it's a matter of fact that they don't. They might have access to some pools, definitely not all.

      • #1 is a HUGE deal. Fidelity will also let you place overnight orders and the trade book on them is super thin. If you place a market order (buy or sell at whatever the market price is) you can lose a fair amount of money.

        e.g. during the day if MSFT has a bid/ask of 312.30/312.31, there's probably only one share available "on the books" at that asking price. When you place an order to buy 100 shares, other shares *magically appear at that price. *It's not actually magic, it's pulling from books on other ex

        • Re: (Score:2)

          by EvilSS ( 557649 )

          PSA: Use limit orders for overnight trades, friends.

          I'm pretty sure Fidelity only allows limit trades after hours for retail customers for the reasons you outlined. I know when I've place after hours orders that's been my experience with them.

    • Re:Why not? (Score:5, Informative)

      by DarkOx ( 621550 ) on Thursday May 11, 2023 @08:02AM (#63513629) Journal

      After hours trading has been available to relatively small players, think anyone with an account level beyond the brokers most basic offering and enough assets to clear the PDT rule, for at least select stocks and large funds.

      The issue is price discovery like you said the big boys trade whenever they want. While retail sleep the fund manager guys have even more weight to push prices around. Sometime they make big trades because they have to align to some composition requirement or other reason that have nothing much to do with a given position as far as any other news or analysis. Closing the window overnight is impart to keep cooler heads and prevent momentum trades.

      IE $MegaFund starts selling $Vertical because $MegaFunds published strategy says they have to be 85% invested in basic materials and $Vertical just bought processing business. Some people would see $MegaFund unloading ${former}Vertical and panic, OMG what does $MegaFund know! When in reality the merger should be seen as a great thing for $Vertical's share holders. By morning using the people stuck holding get a chance to look into why $MegaFund sold and realize they should take the opportunity to buy at open rather than panic sell.

      If you want to trade AH though, just ask your broker, chances are you can without switching to RH; but you might be restricted to some major widely held fund families and widely held blue chip stocks.

    • Liquidity . You get the best price on buying and selling when a market comes together at a set time, the best way to achieve this is have set market hours so you get all the buyers and sellers together at once. The more buyers and sellers the better the prices. How many people are buying and selling stock at 3am on a Sunday morning? Take a simple farmers market as an example, most farmers markets setup like Saturday morning 9am - 12pm. Buyers and sellers all come together and start buying and selling. If

  • That Fits (Score:5, Informative)

    by necro81 ( 917438 ) on Thursday May 11, 2023 @07:08AM (#63513545) Journal
    The casinos in Vegas are open 24/7, too.
    • That was my thought. As a professional, I'm torn between:
      • Freedom: the little guy should have access to the same stuff the big guy has access to
      • (Lack of) Education: it's difficult enough for professionals, not sure the little guy is doing himself a favor entering the big arena. Think Joe Sixpack entering the Indy 500 with his souped up Dodge Demon.

      • Re: (Score:3)

        by ranton ( 36917 )

        That was my thought. As a professional, I'm torn between:

        • Freedom: the little guy should have access to the same stuff the big guy has access to
        • (Lack of) Education: it's difficult enough for professionals, not sure the little guy is doing himself a favor entering the big arena. Think Joe Sixpack entering the Indy 500 with his souped up Dodge Demon.

        Vegas is a good analogy when considering how smart it is for regular guys to be playing the same games as the professionals. It is about as smart as taking your life savings to Vegas and sitting down with professional poker players.

        If you aren't a professional just stick your money in low fee index funds.

  • This is all just a scam. Mum and Dad investors will likely never come out of any RobinHood investment with any financial gain. Such companies exist only by taking money from the people who are not adequately financially informed. Robbers of Sherwood Forest will take your money at every turn in the forest.

    This isn't really news, it's spam targeting the vulnerable.

    • Bull, my Robinhood account has made profit over the life of the account since I opened it back in 2016.

      Anyone who knows how to trade should be able to go to the ALL timeline and see green, not red.

      • Something like 95% of all day traders end up losing. You're literally bragging about ripping those people off who don't know better. Congratulations I guess.

        • I thought the problem with the post was being happy with a net gain since 2016. Even after recent losses the S&P 500 has more than doubled from May 2016 to today.

    • Re:Scam (Score:4, Insightful)

      by timeOday ( 582209 ) on Thursday May 11, 2023 @09:11AM (#63513777)
      "Scam" is a strong word, but it's like those gyms (Planet Fitness) whose whole pitch is to people who don't go to the gym. On one level it's all warm and inviting, but it also happens to reach out to the most profitable, least-demanding of all customers - those most likely to end up with a recurring payment for something they never actually use.

      When I see a commercial for a brokerage pushing lots of cool-looking analytics and trading from a cellphone to "put you in control" what I see is Candy Crush with commissions. You cannot consistently time the market without inside information. You just can't.

      • I'm no investor, but I've paid off a car on stock profits.

        It can be done if you invest in things you believe in, keep it simple, follow those old golden rules, avoid options, etc.

  • I'm shocked (Score:4, Interesting)

    by JKanoock ( 6228864 ) on Thursday May 11, 2023 @08:29AM (#63513675)
    I'm shocked that Robinhood is still in use as a trading platform, I have not heard anything about them in months.
    • You haven't heard anything about them in months and that's a good thing.

      They've managed to stay out of the news (out of trouble) lately

  • The current market rules already too much for retail. Lots of pre-market and after hours activity happens now that can create substantial risk for people who just like to be value investors. Set a stop loss and suddenly a minimal volume environment pre-market results in a massive dump that triggers the stop loss on open. Stuff like that.

    Traders don't need most of the PM and AH trading time. The big boys can easily arrange direct transfers outside of the exchanges for lots of shares.

    • Re: (Score:3)

      by GBH ( 142968 )

      Not just that.

      It has been proven that in hours trading has absolutely ZERO impact on price and that every single long term shift in price has been a consequence of after or before hours trading.

      We'll also ignore the fact that as much as 90% of *ALL* retail trades are "off exchange" and/or internalised so CAN'T actually affect price discovery too...

      It's all a total and utter scam

      • Not just that.

        It has been proven that in hours trading has absolutely ZERO impact on price and that every single long term shift in price has been a consequence of after or before hours trading.

        Where has that been proven?

        • Re: (Score:2)

          by GBH ( 142968 )

          Not just that.

          It has been proven that in hours trading has absolutely ZERO impact on price and that every single long term shift in price has been a consequence of after or before hours trading.

          Where has that been proven?

          https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3705017

          https://www.bespokepremium.com/interactive/posts/think-big-blog/intraday-selling

          • Re: (Score:2)

            by micheas ( 231635 )

            Considering a few factors this isn't surprising:

            • News is always released after trading hours. Or trading is halted for news.
            • Dividends are always paid outside of trading hours.
            • Exchange traded options always expire on Saturdays

            So much of what happens during the day is a zero-sum game. That doesn't mean that it is a scam. (Someone claiming that you'll make money day trading without being one of a Market Maker, a Specialist, or a Quant is very misleading, as the rules are rigged for Market Makers and Special

            • Re: (Score:2)

              by GBH ( 142968 )

              I think you're misunderstanding what's being said.

              *NO* indraday trades of any kind have any impact whatsoever on price discovery. Think about that for a second - the entirety of all retail trades (approx 23% of all Intraday trades) and *ALL* of the other trading during those core hours has no impact on price. Considering the volumes are orders of magnitude greater AND contain the entirety of retail sentiment how can you possibly suggest it's not a scam?

              It means by definition that price is controlled by the

  • In related news - RobinHood is under ivestigation by SEC: https://finance.yahoo.com/news/robinhood-faces-regulatory-probes-over-212550548.html

    As an aside, I always thought that their brokerage name is a bit too much irony for their average user to understand.

  • He's out to suck the blood out of your body and the marrow out of your bones, day and night.

  • Meme stock lock-outs (Score:5, Interesting)

    by Vandil X ( 636030 ) on Thursday May 11, 2023 @08:48AM (#63513701)
    And when a meme stock is active, they will lock you out of trading it 24/7. GME, BBY, AMC...

    • And when a meme stock is active, they will lock you out of trading it 24/7. GME, BBY, AMC...

      Evidence that the world isn't completely insane.

  • Dark pools. (Score:4, Interesting)

    by Gravis Zero ( 934156 ) on Thursday May 11, 2023 @09:30AM (#63513827)

    What they are doing is allowing you trade within their own dark pool [wikipedia.org] which is actually how the entire Robinhood system is setup. The reason the gamestop stock thing became a problem is because you were pulling from outside a dark pool AND it was hurting their parent company.

  • Robinhood does not exist without the FOMO.

  • In a news release posted Wednesday, notorious mugger Tom "the slapper" Harrison has announced a new 24-hour mugging schedule for the convenience of all citizens. The release, which was sent out to local news outlets, stated that the mugger has decided to change his ways and make mugging more accessible for those with busy schedules.

    According to the release, the mugger will now be available to rob individuals at any time of the day or night, making it easier for people to get mugged on their way to work, du
  • Saying 'pray we don't alter the deal futher"'.

  • Sorry, Robinhood has been an enemy to independent investors since the whole GameStop fiasco.

  • How does it works when exchange is closed ad night? I understand they can build a local exchange with only Robinhood clients, but what happens at the time the real exchange re-opens, with possibly very different prices?

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