Ocasio-Cortez Questions If Trading on Robinhood Is Really Free

The video discusses the concept of payment for order flow and its impact on the perception of free trading on platforms like Robin Hood. It highlights the hidden costs associated with trading, such as poor execution and loss rebates. The video also explains Robin Hood's business model as a for-profit entity that needs to generate revenue. Despite initial skepticism, the payment for order flow model has become a standard in the brokerage industry, proving its success.

What is the main concern about payment for order flow in relation to free trading?

• It increases the number of trades.

• It makes trading more transparent.

• It hides the true cost of trading.

• It reduces the number of available stocks.

Why does Robinhood need to generate revenue?

• To invest in new technologies.

• To cover operational costs.

• To pay for advertising.

• To expand its user base.

What was the initial skepticism about Robinhood's model?

• It would require too much regulation.

• It would be too complex to implement.

• It would not be profitable.

• It would not attract enough users.

How has the payment for order flow model impacted brokerage operations?

• It has reduced the number of trades.

• It has led to increased fees.

• It has been largely abandoned.

• It has become the standard model.

What does the success of the payment for order flow model suggest?

• It can be a viable business model.

• It is not sustainable long-term.

• It is only suitable for large brokerages.

• It requires government intervention.