Matador App

(Big Boss) #1

Recently coming out of stealth is a new zero commission broker in the US called Matador. It’s differentiation from Robinhood is that there is a social feed so you can see what your friends are trading and “to encourage conversation and learning”. Also, pretty high cash rates of 2.5% up to $10k. Only on iOS at the moment and Android is coming soon/waitlist.

https://www.matadorapp.com/

As part of the unveiling, the company also announced a fundraise of $9m from Accel and Greylock.

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#2

I like their mission, which is to make investing less scary but social sounds risky. Although it’s good to see they have tried to counter some of the issues with

”Matador has a No Day Trading Policy so tread lightly in the day trading zone to avoid getting your account restricted.” - Source

I wonder how they do the social element. Whether that is like a Twitter where anyone can follow anyone else? Or whether it’s limited to your contacts list?

I also like that they show losses in the social feed, for instance it says “Joshua sold IBM and lost 7.5%”.

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#3

The idea sounds very good, I think it will be very successful. Their mission sounds very similar to Freetrade. Interested to hear the thoughts on someone from Freetrade’s team on whether there could be any plans on implementing that social element on their platform as well.

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(Emma) #4

Social could be risky depending who you are communicating with. There’s always self appointed experts and that’s the main danger but I know there’s a few of us on slack who discuss what investments we have chosen and it’s fun. Normally it’s what has fallen dramatically though :grin:

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#5

Yes that is definitely truth. Can be a double- edged sword for sure, interested to see how that turns out though.

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(#18 414) #6

I find hard to reconcile the idea of following your mates investments and the idea of do your own research.

In a winning spree it can feel great, but when prices start to fall without mercy I fear the chances of making self damaging decisions may be exacerbated with unrealized losses becoming realized ones because someone else did the same.

Also, both entry and exit points are different for different people, hence timing must be different too.

Making buy or sell decision based on what someone else did may not be totally bad if one understands the rationale behind it. If that’s not the case then I can’t think that’s something to be made available nor encouraged. If one doesn’t understand the reasons that led to a decision, then it shouldn’t copy that decision. Deciding to buy into an asset just because my mate just bought it isn’t a criteria I can classify as sound. And it seems to me that’s exactly what that sort of social feed encourages to do.

I personally prefer a community forum where each one decides what to share or reveal to the other members. And each one takes the full responsibility for the consequences of it’s own decisions, good or bad

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(Emma) #7

Just because you can see what others are investing in or selling doesn’t mean you will copy it, although I agree I’d like to select what information is shared

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#8

My idea was also that social aspect to be more of a discussion based rather than blindly following people, but when I give it more thought it can get ugly used the wrong way. I don’t want to imagine all the people from Robinhood’s community or r/wallstreetbets at one place having the chance to share their trades live.

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(#18 414) #9

Of course not, but the risk is there.
Take a look at my imaginary friend. Let me call him John.
Jonh is a smart guy. He’s funny. Everybody likes him and everybody listens to what he says. He’s a self confident dude.
I like John and I think he’s reliable. He starts buying into this company and in the other one, and then the other. I don’t copy he’s trades. Not straight away at least. Time goes by. He’s results are better than mine. I give in and start copying some of his decisions. Some dreadful event send those investments towards the gutter and I don’t know what to do…

I simply fear something like this may happen

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(Emma) #10

isn’t that the same risk you take if you talk to imaginary John in the imaginary pub?

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(Aris David) #11

Sounds like eToro only difference is they do real equities eToro does synthetic securities such as spread bets and CFDs.

“Toro” - Spanish for Bull
“Matador” - Spanish for bullfighter

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(#18 414) #12

I think I see your point. At a fundamental level it’s not different at all. And if we were to add our phones in the pub with the app opened…

I don’t like it. Maybe I’m old fashioned

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(Big Boss) #13

I think what’s interesting is the amount of money they’ve managed to raise from pretty prominent investors with little market traction (so far).

It could prove useful for benchmarking Freetrade’s next round. Assuming a sensible amount of dilution for the new money, e.g. 20% to 30%, Matador could be worth around $30m to $45m post money. All this with only an iOS app and no meaningful user count, as they’ve just come out of stealth.

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#14

eToro announced last week that they will soon offer commission free stock trading in the UK.

Somewhat more interesting is they acquired “Firmo” which will “operate as an internal R&D arm within eToro focused on developing blockchain-oriented trade execution and the infrastructure behind the digital representation of tokenized assets.”.

(Louis Otto) #15

Although I loved my time on eToro, there were a lot of drawbacks and hidden costs. Also the system was quite buggy. If Freetrade had their wealth of offerings, I’d never look back.

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