Brokers Restricting US Trading on GME, BB, AMC and Many More

[Deactivated] on 29/01/2021 - 14:49
Last edited 29/01/2021 - 15:03

Robinhood, TD Ameritrade, Webull all made moves to suspend buying of GME(Gamestop), AMC, BB(Blackberry) and other commonly WSB traded stocks. Traders can now only sell or close positions, not open new ones.

“We continuously monitor the markets and make changes where necessary. In light of recent volatility, we are restricting transactions for certain securities to position closing only, including $AAL, $AMC, $BB, $BBBY, $CTRM, $EXPR, $GME, $KOSS, $NAKD, $NOK, $SNDL, $TR and $TRVG. We also raised margin requirements for certain securities,” Robinhood said in a statement.

As a result, Congress has made moves to hold a hearing involving Robinhood.

Poll Options

  • 138
    Brokers do not have the right to restrict trading stocks
  • 3
    Brokers have the right to restrict trading of stocks
Financial

Comments

  • Drakesy on 29/01/2021 - 14:57
    +9

    Yeah i think Robinhood will have a bit of a case to answer when it comes to the class actions that are about to be opened up.

  • [Deactivated] on 29/01/2021 - 15:01
    +13

    The whole directional aspect is so wrong. If they KNOW their friends are trying to close short positions and they block people buying, that is daylight robbery.

    Robinhood have some form of excuse of having to comply with a high capital requirement, but if they block a stock, it absolutely has to be selling as well.

    Even worse, their biggest client Citadel had likely been tipped off and he started shorting the stock on the knowledge that the Robinhood buying restriction would send the price lower.

    • DashCam AKA Rolts on 29/01/2021 - 17:25
      +2

      My understanding is Citadel has financial interests in both Robinhood (having supplied 40% of its start up capital) and the hedge fund that shorted Gamestop to 140% of possible stock. Dodgy moves alround.

      • cloudy on 29/01/2021 - 17:34

        But both hedgefunds in action has closed out of positions as of yesterday

        • [Deactivated] on 29/01/2021 - 17:40
          +3

          They both claimed they did, but monitoring short volume shows there is no way they fully covered their positions.

          • cloudy on 30/01/2021 - 05:00

            @[Deactivated]: Monitoring short volumes??
            They’ve covered their positions not by buying back stock. They’re gone to derivatives to cover themselves. Or OTC.

  • dust on 29/01/2021 - 15:44
    +22

    Robinhood, steal from the poor to give to the rich.

  • iNeed2Pee on 29/01/2021 - 16:15
    +4

    Makes me sick.

    They should make a movie about this similar to Trading Places.

  • Loot N Plunder on 29/01/2021 - 17:04
    +5

    I have always said "the higher up the food chain the bigger the crook"

    Just look at our history of wage theft in Australia and the punishment they receive

  • cloudy on 29/01/2021 - 17:35
    +1

    I dunno why they are banning people from buying, but it’s probably gonna stop a lot of people losing loads of money when this thing busts.

    • [Deactivated] on 29/01/2021 - 17:42

      Citadel have a controlling interest in both Robinhood and Melvin Capital which benefit greatly as they both have large short positions.

      • cloudy on 29/01/2021 - 18:48
        +4

        Let’s be honest, how much does RH control of the brokerage market?

        I dunno the answer, but unless they control most of it it’s not gonna stop anyone starting an account somewhere else to buy the stock. I’d hazard a guess and say RH makes less than 1% of all stock trades, and say there’s probably a hundred of other brokers who can execute a buy GME if a client desired.

        I should add, I think it’s stupid to ban the trade and wrong. Like I said, someone else can execute the trade anyway.

        • whooah1979 on 29/01/2021 - 18:54

          13m is a substantial amount of users.

          • cloudy on 29/01/2021 - 18:56

            @whooah1979: Relevance?

            • whooah1979 on 29/01/2021 - 19:03

              @cloudy: They’re one of the few retail brokers that allow fractional orders. Any Joe or Jane can hold 1/1000000 of a share which makes them appealing for small traders and perfect for WSB.

              • cloudy on 29/01/2021 - 20:14

                @whooah1979: Yea ok, so a few thousand people can’t afford to pay $200-$300, For a whole share, to join the party and wants to invest half a share or whatever.

                But that’s not the driver of this run.
                Even looking on reddit it’s clear most people are throwing a (few) grand+

                • dcep on 30/01/2021 - 00:03

                  @cloudy: they bought shit tonnes of call options, not buying the shares …
                  and insto that sell those call options had to cover the calls aka buying the shares unless they got balls selling it naked

                  • cloudy on 30/01/2021 - 04:57

                    @dcep: They can cover calls by buying calls back. Most instos only engage in covered calls strats.

  • mskeggs on 29/01/2021 - 17:36

    This is disgraceful.
    There will be repurcussions that will erode trust in markets, very short sighted.

  • [Deactivated] on 29/01/2021 - 18:13

    Citadel responds https://youtu.be/D6wN16vVqtM

    • [Deactivated] on 29/01/2021 - 18:18

      I'd want to see phone records and emails before I believed Citadel.

  • poboy on 29/01/2021 - 18:15

    It's their platform, so they have the right to. But they must now deal with the consequences.

    • orangetrain on 29/01/2021 - 21:53

      They hope so. Fines are a bargain.

  • holdenmg on 29/01/2021 - 20:34
    +1

    I never had a problem with https://www.robinhood.com.au/ Rangehoods. lol

  • orangetrain on 29/01/2021 - 21:47
    +3

    Robinhood and hedge funds are doing illegal crimes because they rather pay millions in fines than billions or even trillions.

    Wolves of wall street are about to get eaten by sheep.

  • T-man on 29/01/2021 - 23:31
    -4

    Miss Trump yet?

  • [Deactivated] on 30/01/2021 - 10:04
    -2

    At the end of the day people have to sell their shares. No matter how high the price goes people will have to close their long positions eventually. When they do they will increase liquidity and the price will go down.

    When home investors start cashing out there will be a drop in price and this will initiate panic selling.

    Those who don't get out early will be left carrying the bag. There's no denying it.

    Those magical unrealised virtual gains might feel good but they don't translate into cold hard cash.

    So what could/should industry do to protect these potential bag holders?

    We don't want banks lending mortgages to people who can't afford them… but should people be allowed to throw away their own money?

    • whooah1979 on 30/01/2021 - 11:02
      -1

      Legacy banks are the dodgiest crooks around. Should they be allowed to lend 💵 to people that they don't have?

      Let the people do what they want with their 💵.

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