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This is a powerful slogan in support of the democratisation of finance. In fact, its motto is “investing for everyone”. Robinhood, which first launched in 2013, makes it possible for its users to trade financial products without having to pay a commission or deposit a minimum sum. “There was no intention to be assigned this much and take this much risk, and I only thought that I was risking the money that I actually owned.” “How was a 20 year old with no income able to get assigned almost a million dollars worth of leverage?” the note left by Kearns to his family read. And even by his own admission, Kearns stated in his note that he had “no clue” what he was doing. It has been confirmed, however, that he was new to options trading and that there was little oversight of the transactions he was making. It remains unclear what exactly Kearns believed had happened nonetheless, the app’s display for his account made it seem as if he had incurred disastrous losses. As such, Kearns may have misunderstood how the app calculated his overall balance.
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But this may not have represented the amount he was due to repay rather, it was a temporary balance that had yet to account for the stocks underlying his options positions that had not settled in his account.
![robinhood app options trading robinhood app options trading](https://www.alphr.com/wp-content/uploads/2021/03/Screenshot-2021-04-05-114122.png)
On June 20, 2020, it was reported that 20-year-old Alexander Kearns, a student at the University of Nebraska, had taken his own life after believing he had racked up more than $700,000 in losses by trading options using the popular Robinhood investing app.Ī screenshot taken from Kearns’s mobile phone revealed that his account showed a negative balance of $730,165.