A day after the Wall Street regular slapped a $70 million penalty on Robinhood Markets Inc – the largest it has ever imposed in history – the financial services company filed with the U.S. SEC to go public.
Robinhood wants to list its shares on the Nasdaq Stock Exchange under the ticker HOOD. The U.S. firm expects to raise $100 million in capital from the initial public offering and is yet to disclose the exact date of its debut.
Thomas Peterffy’s remarks on CNBC’s “Squawk Box”
On CNBC’s “Squawk Box”, Interactive Brokers’ founder and chairman Thomas Peterffy acknowledged Robinhood’s contribution to the world of retail trading and welcomed the news of its potential IPO. Peterffy said:
“Bringing 80 million people into the marketplace who would otherwise not be here is a fantastic accomplishment. It’s a great service to the country, and I think more competition will be great for the future of our economy.”
Robinhood recently slashed its margin rates from 5% to 2.5%, but it’s still twice as much as Interactive Brokers charge.
Robinhood is growing at a very fast pace
Peterffy acknowledged that Robinhood has had a few missteps in recent months that led to regulatory challenges but disregarded them as inevitable for a company that is growing at such an aggressive pace. According to the IB chairman, Robinhood has the potential to “become the greatest meme stock in the future.”
“They have negative equity, roughly zero earnings, but they are growing very fast. And that’s the kind of thing that the market seems to like lately,” Peterffy added.
Peterffy fixated on how it’s a great thing that Robinhood is bringing more and more people to the market as that could benefit Interactive Brokers as well in the long run. He admitted that many of the new players don’t do well initially, but those who do eventually are in search of a ‘more serious broker’, and that’s where IB steps in.
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Wajeeh Khan
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