Matt Levine is my favorite source of insight into the nitty-gritty of financial markets. He has an uncanny ability to take what would be the most boring minutiae and turn it into a fascinating and well told story.

I don’t see a problem with what Robinhood is doing. I don’t trade stocks all day. I’m not worried about 10 cents price improvement. By the time I enter my limit price and click buy or sell the price has already ticked up or down.

I buy the stocks that I think will go up over time.

There’s a psychological impact of commissions. When you click the button you have immediately lost money. Now you have to make it up!

I don’t want to be reminding myself “ah, but I paid the $2.34 commission and got my 10 cents price improvement so I came ahead by $1 on a $1000 trade”. Or whatever the actual numbers add up to be.

If the price was $58.10 and I put $58.50 limit (so it doesn’t tick away from me before I click) and the order gets executed at my limit or less and I pay no commission, it seems like I would’ve gotten what I wanted.