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Matt Levine

Robinhood Had a Busy Week

Also silver, GameStop, the Problem of Twelve and Clubhouse/Clubhouse.

How much money has Robinhood Markets Inc. lost in the last week due to its retail customers’ frenzied trading of popular meme stocks like GameStop Corp.? I don’t know the answer, and I assume that with a large enough customer base it is not literally zero, but … I assume that it’s roughly zero? Probably someone somewhere got a margin call, couldn’t meet it, and left Robinhood holding stock that was worth less than the margin debt; that happens from time to time in volatile markets. But I have not seen any stories like that. Many of the meme stocks have performed surprisingly well so far, and Robinhood has raised margin requirements on some of the most volatile ones to limit its risk. (It’s still early, though, and the meme stocks are having a rough morning.) If the story here was, like, “thousands of Robinhood customers have lost everything in their account and more, leaving Robinhood to bear the excess losses,” you would probably have read sad interviews with some of them, and the tone on the WallStreetBets subreddit would be different.

Meanwhile how’s business