Investing
Robinhood Crisis Reveals Hidden Costs in Zero-Fee Trading Model
For all its benefits, the “democratization” of the stock market can quickly devolve into recklessness.
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Turns out, no-fee stock trades can exact a very high price after all.
Not only for the retail traders sitting on deep losses speculating on meme stocks, or for Robinhood, which faces recriminations for “gamifying” the frenzy that spun out of control and was forced to scramble for billions in fresh cash, but also for the stock market itself, which must reckon with the wild swings that have little bearing on fundamental value.