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- Members of the Robinhood subreddit are roasting the brokerage after Fidelity debuted its fractional trading program on Wednesday.
- Robinhood announced its fractional trading program in mid-December, but the service has a waitlist of more than 1.2 million users.
- Fidelity said it opened its service to some clients the day of its announcement and would continue the rollout “over the next several weeks.”
- “Robinhood, if you’re looking at this: this is what happens if you delay and waitlist everything,” one forum member wrote. “It’s not gonna generate hype, just cause us to move to other platforms.”
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Some of Robinhood’s biggest fans lambasted the discount brokerage online on Wednesday after the legacy firm Fidelity was quicker to release fractional trading.
Members of the Robinhood subreddit decried Robinhood’s slow rollout of the buzzy new feature. The company announced its fractional trading service on December 12, though its app said the program was in “early access” with more than 1.2 million users on its waitlist. The product rollout will continue through early 2020, a Robinhood representative previously told Business Insider.
Fidelity unveiled its fractional trading program on Wednesday, allowing some clients to immediately trade slivers of shares and saying it would continue the rollout “over the next several weeks.”
Members of the Robinhood subreddit said Fidelity’s quick response could prompt a mass exodus from the younger brokerage.
“Never forget that it was Robinhood’s success that pushed Fidelity, Merril, etc to implement no-fee trading and fractional shares,” a Redditor with the username Flufflebuns commented on a post on Wednesday addressing Fidelity’s new service. “Unfortunately Robinhood’s watch has ended now that the big guys have implemented these excellent trading policies.”
“Robinhood, if you’re looking at this: this is what happens if you delay and waitlist everything. It’s not gonna generate hype, just cause us to move to other platforms,” another user wrote.
Robinhood said in a tweet on Friday that fractional trading “is rolling out to more customers.”
Robinhood rose to fame by undercutting major brokerages on costs typically associated with stock trading. The platform began by offering commission-free trading through a smartphone app in 2015 and later introduced cryptocurrency trading, options contracts, and high-yield savings accounts to its millions of users.
The company took on an early-mover reputation as older firms rushed to offer similar products. But as many brokers cut trading fees in the last quarter of 2019, Robinhood has faced new competition from the services it sought to replace.
“Robinhood is smaller and was supposed to be the disrupter since they’re so nimble,” a forum member with the username Synthecid3 wrote, adding: “It’s clear to me that RH isnt as hungry as one would expect. Honestly, why even stick around on an inferior platform.”
The discount broker faced similar online backlash in early November when members of the WallStreetBets subreddit exploited a glitch to leverage seemingly infinite amounts of cash. Posts detailing the glitch prompted copycats to borrow massive amounts of capital, with one saying they turned a $3,000 deposit into a stake worth $1.7 million through the options-trading hack. Another Reddit user compiled a hall-of-fame list of traders using the glitch “to celebrate our new Infinite Money Cheat Code.”
“The only reason I stay with Robinhood is because of the glitches, lagging and general nonsense this company offers,” one Reddit user commented on Wednesday. “It makes gambling investing more entertaining.”
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