"In a recent survey of those with trading accounts, E-Trade discovered that 40% of millennials that were surveyed traded options at least once a month, making them 60% more likely to trade options than their Generation X counterparts." While I'm still not planning to trade options, it sounds like a lot of dumb money is entering the market...making it more attractive. I imagine most are just buying options to gamble on FB, Amazon, etc. making a big move.
The surprise here is not so much that they are trading options, as that they are doing it at E-Trade.
There is just tooooo many fintech companies now. Everyone is entering into this market, it started about 4-5 years ago but just recently over the last year this scene has just skyrocketed. Everyone is fighting for your money. Yesterday it was announced that greendot was offering 3% on your money which is now higher than betterments promotional rate of 2.69%. and wealthfronts at 2.57%. these are extremely high interest bearing accounts compared to Traditional banks which are offering no more than 0.10%% aside from all this it seems they keep one upping each other. As for Gatsby and their free options trading platform how will they make their money? They need to offer more than just options and the only reason why this options market situation is taking off is because of the millennials getting a taste for it on Robinhood. Bull market the last decade is getting lots of new investors in especially into the options market However once this market goes into a bear market most will lose interest in these markets. These free trading companies are doing very well with raising capital and creating euphoria over trading for free. But let's see what happens during the next downturn..
Its great there is more competition but we need that in futures so we can finally get free commission future brokers
How will they make money? Oh, selling the order flow for Citadel so they can front run your trades and make mad bucks.. EDIT: BTW I'd love a commission free options trading, hope we'll get that and a good platform with it along with a good order execution, don't mind the front running at all, saves me a ton of money anyways..