REUTERS: A typical soldier in the army of retail traders upending Wall Street is a 31-year-old who checks their smartphone seven times a day to examine the assets in their first-ever brokerage account, which may or may not contain a significant amount of cryptocurrency in addition to stocks. The nuggets contained in the July 1 filing by online trading firm Robinhood Markets, which is seeking for an IPO worth over US$40 billion, include those broad strokes defining retail traders.
The company included information about its more than 18 million customers in its file, as well as some of the possible hazards of investing in the company, which grew its headcount from 289 in December 2018 to more than 2,100 in March this year as retail trading took off.
Individual traders gathered in online forums such as Reddit’s WallStreetBets, whose activity has helped fuel wild rides in shares of video game retailer GameStop, movie theater chain AMC Entertainment Holdings, and a slew of other so-called meme stocks, according to the detailed breakdown of Robinhood’s user base.
The following are some of the highlights from the filing:
– The median age of clients on the company’s platform was 31 as of March 31, 2021.
– From January 1, 2015, to March 31, 2021, more than half of those who funded accounts on the site claimed it was their first brokerage account.
– In 2020, customers used the app an average of roughly seven times per day, a year marked by violent market swings in the aftermath of the coronavirus outbreak.
– According to the company, nearly half of all new retail-funded accounts opened in the United States between 2016 and 2021 were formed on Robinhood. At the end of the first quarter of 2021, Robinhood had around US$65 billion in equities, US$2 billion in options, US$11.6 billion in cryptocurrencies, and US$7.6 billion in cash under custody.
– Cryptocurrencies have been really beneficial to the organization. Over 9.5 million consumers traded over US$88 billion in bitcoin on Robinhood in the first quarter. Between March 31, 2020 and the end of the first quarter of this year, crypto assets grew 23-fold. – Dogecoin transactions account for a significant amount of Robinhood’s recent net revenue growth, according to the business. According to Coingecko.com, the price of Dogecoin, which has been endorsed by billionaire entrepreneur Elon Musk, has increased by more than 10,000% in the last year. “Our company, financial condition, and results of operations might be negatively affected if demand for Dogecoin transactions drops and is not replaced by fresh demand for other cryptocurrencies accessible for trade on our platform,” according to the petition. – The majority of Robinhood clients are buy-and-hold investors, according to the business, repeating a common mantra on WallStreetBets, where users push each other to stick onto their favorite joke stocks despite sky-high volatility. (David Randall and Sinead Carew contributed reporting; Ira Iosebashvili contributed further reporting; Stephen Coates edited the piece.)/n
