A longer-term Engineering solution to the ‘Robinhood’ Problem

From Wall Street to K-Street, everyone is up in arms about Robinhood, as a Financial Services Technologist, I believe we need to find a longer-term solution for this ‘problem’.

I also strongly believe, engineering can solve it for the industry!

I hate to single out, Robinhood, I love Robinhood, but it was just flashier news, so you know, several other brokers put restrictions on these trades as well.

Robinhood, however, should have done better damage control.

Photo by Clay Banks on Unsplash

Let me recap the problem first, I would recommend you to read these 3 articles from Barrons, DailyMail & Yahoo Finance articles, I cannot write any better.

Here is the summary of the longer-term solutions, you can skip the details if you like -

1. FINRA needs to expedite ACATS transfers from 10 business days to hours
2. Brokerages need to implement better segregation of trades/strategies and not block the entire TICKER
3. Exchange and Market level protection to smaller brokers, like Robinhood. But, brokers need to protect themselves. Be resilient.

FINRA needs to expedite ACATS transfers from 10 business days to hours