Stock order routing
When you buy or sell stocks with Robinhood, Robinhood U.K. Ltd will receive and transmit your orders to Robinhood Securities, LLC who will send your orders in an agency capacity to market makers that typically offer better prices than public exchanges. For fractional share trading Robinhood Securities may act in a (riskless) principal capacity to enable you to trade fractional shares.
Order routing is the process of sending your order to a market maker. For further details on our order routing practices, refer to our Order Transmission Policy.
A market maker is a third-party institution that typically acts as a liquidity provider and executes orders.
Let’s say you want to buy 1 share of YOWL. To do so, you’d place a buy order in the app. Our order routing system uses an algorithm that would send your order to a market maker, based on historical performance.
We have relationships with several market makers, and our routing system is designed to automatically send orders to the market makers that are likely to give you the best execution, based on historical performance.
We pursue execution quality by striving for the best price that’s reasonably available for the orders you place.
The majority of our orders are filled at the National Best Bid and Offer (NBBO) or better, which means most customers are, at a minimum, receiving the best publicly available bid or ask price. We also perform regular, rigorous reviews of the execution quality our customers receive, looking at factors like execution price, speed, and price improvement.
Consistent with the US Securities and Exchange Commission (SEC) Rule 606, we disclose our routing practices and other relevant information required by SEC Rule 606(a) in the SEC Rule 606 and 607 Disclosures in our Disclosure Library.
No. We don’t share your order information with anyone before we send orders to market makers.