“I could hardly believe it, what I saw on Reddit today,” he sang. “Was hoping I could get it straight from you. They told me ’bout order flow, so I Googled, now I know. I think I gotta find somebody new.”
Bolton goes on, “So tell me all about it. Tell me who you sell my trades to.”
The pop-culture critique underscores the enormous attention being paid to how Robinhood and other brokers have adopted commission-free business models. Critics say trading isn’t really free and that high-speed trading firms on Wall Street are getting the better end of the deal.
During the introduction to his song, Bolton pointed out that Public.com says it doesn’t sell trades to third parties.
“I know a thing or two about breakups. And I’m here to help,” Bolton said.
Robinhood has consistently defended its use of payment for order flow, which makes up more than half the company’s revenue.
During the first half of 2020 alone, Robinhood estimated that its customers received more than $1 billion in price improvement — the price they received compared with the best price on a public exchange.
Citadel Securities, the high-speed trading firm that Robinhood sends much of its orders to, has similarly defended the practice.
“It is a key reason why retail investors are able to trade for free or low commissions today,” Citadel Securities founder Ken Griffin said during the hearing.