Robinhood, Interactive Brokers restrict trading in GameStop, BlackBerry, and other stocks

Online trading platforms Robinhood.com and Interactive Brokers announced Thursday that they had restricted trading in shares of GameStop, BlackBerry and other companies that posted hefty gains this week on a social media-fueled trading frenzy.

Individual investors who trade on online brokerage apps like Robinhood and discuss stocks on anonymous social media messaging boards have seen a dramatic surge in the share price of companies like GameStop, BlackBerry, and AMC Corp. triggered.

The oversized gains have forced some hedge funds that had bet against the stocks to fold their positions and demanded regulatory scrutiny from commentators.

READ MORE: GameStop, BlackBerry, and AMC stocks see trading disruptions as social media hype drives volatility

The battle between small traders and hedge funds rocked the US and European stock markets and moved to Asia on Thursday. Several Australian companies have joined a list of social media hyped moves that have cost financial institutions billions of dollars.

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The sharply shortened Australian stocks, including Webjet and Tassal Group, rose more than five percent, despite the ASX 200 benchmark index falling two percent in Sydney.

Reddit discussion threads were buzzing again with chatter about the stocks Thursday as members of the merchant-focused group WallStreetBets raced over four million.

In a discussion, thousands of attendees responded to a post calling for more purchases from GameStop and cast retailers as Iron Man versus a hedge fund Thanos, alluding to the superhero movie Avengers: Endgame.

The war started last week when Citron Capital’s famous short seller Andrew Left bet against GameStop and encountered a spate of retailers betting the other way.

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He said on Wednesday that he had given up the bet.

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Regarded as “stupid money” by market professionals, the group of traders – some of them former bankers who work for themselves – has grown into an increasingly powerful force over the past year, worth 20 percent of stock orders, according to data from the Swiss bank UBS showed.

The only way to take advantage of the stock markets over the past decade, fueled by the constant flow of newly created money from major central banks, has also made it less risky to bet on rising stocks.

READ MORE: How COVID-19 is attracting Canadians to the stock market

The US Federal Reserve firmly opened these taps at its last meeting on Wednesday.

This week’s turmoil caught the White House’s attention as President Joe Biden’s economic team – including Treasury Secretary Janet Yellen on her first full day on Wednesday – « monitored the situation. »

William Galvin, the Massachusetts state regulator, has asked the NYSE to suspend GameStop trading for 30 days to allow for a cooling off period.

« The prospect of intervention here is clearly high, but it will only shake the (WallStreetBets) community as it only creates a feeling of inequality in the financial markets, » said Chris Weston, chief research officer at broker Pepperstone in Melbourne.

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« It’s okay to have Fed action backing zombie companies. However, if retailers follow a path that skews asset prices by targeting short sellers, that will stop. »

Reddit said Wednesday that it had not been contacted by authorities about the surges.

– With files from Global News’ money reporter Erica Alini

What if a stock is unsupported by Robinhood?

What if a stock is unsupported by Robinhood?

Stocks may not be searchable or may be marked as non-tradable for several reasons: The exchange has suspended trading. The stock has been delisted from major exchanges and stores in the OTC market. It is a foreign security that we do not support.

Can you buy more stocks on Robinhood?

Stay Up to Date Robinhood, a popular investor app, has prevented customers from buying more shares in multiple companies but allows « limited purchases ». from Friday.

Do I lose my money if a share is delisted?

« While some investors may be willing to buy the company’s stock, they will only do so at significantly lower prices, » says the SEC. … If a company is delisted from a stock exchange, the shares will continue to trade over the counter and ownership of the shares will not be affected.

What if I own a share that is being delisted?

As a shareholder, not much changes if a stock you own is delisted from a major exchange. However, depending on your broker, your ability to actively trade stocks in that company may be limited. You should be able to sell at least the stocks that you owned before the stock was delisted.

Can you transfer Robinhood shares to another broker?

Can you transfer Robinhood shares to another broker?

You can transfer stocks and cash to other brokers through Automated Customer Account Transfer Service (ACATS) wire transfer. If you want to keep your Robinhood account, you can initiate a partial transfer. Otherwise, you can initiate a full transfer and we will close your account once the process is complete.

Does Robinhood charge a fee to withdraw funds?

How do I get my money from Robinhood? You can withdraw your funds to your bank account, up to $ 50,000 per business day. Simply select « Transfer » from your account options. and then « transfer to your bank ». to initiate the withdrawal. There is no withdrawal fee.

Can I move stocks from one broker to another?

You can transfer an entire brokerage account or certain securities from one brokerage to another. … For tax reasons, it is often better to transfer shares from one broker to another than to sell them and buy them back from a new broker.

How do I get my money from Robinhood?

Withdraw money from Robinhood

  • Tap the account icon in the lower right corner.
  • Tap Transfers.
  • Tap Transfer to your bank.
  • Select the bank account you want to transfer to.
  • Enter the amount you would like to transfer to your bank.
  • Tap Submit.

Is It Legal For Robinhood To Restrict Trade?

Is It Legal For Robinhood To Restrict Trade?

While Robinhood’s customer agreement clearly states that trading can be suspended at any time, it does raise questions about whether the platform treats some users differently than others, particularly after cases in the past decade of market manipulation by short sellers that penalized retail investors, Mitts said , …

Is there a class action lawsuit against Robinhood?

Thousands of investors are using a consumer-facing online service called DoNotPay.com to automatically join a class action lawsuit against the Robinhood trading platform. The lawsuit was filed in the southern borough of New York on Thursday after Robinhood temporarily restricted GameStop trading on its platform.

Why was Robinhood closed?

There is, of course, an explanation for the stock buying frenzy that led to Robinhood’s decision to cease trading. Users of a Reddit sub-forum called r / WallStreetBets have decided to capitalize on the fact that GameStop is a popular stock for hedge funds that are falling short.

How Long Can Robinhood Restrict Trading?

If you do not cover your daily business call within the 5 day window, you will not be able to trade the daily business for 90 days.

Can I trade with 25k on Robinhood?

As long as you have a $ 25,000 cash account, you can trade during the day. With a Robinhood Cash account, you can place commission-free trades both during regular and after-hours. You don’t have access to instant deposits or instant billing.

What’s the catch with Robinhood?

The U.S. Securities and Exchange Commission on Thursday accused the fast-growing online broker Robinhood Financial of misleading customers about how it made money for several years, causing deals to go so badly that customers are also considering the company’s free commissions fared worse.

Can you trade without 25k?

If you do not have $ 25,000 in your brokerage account prior to day trading activities, you will not be allowed to make day trading activities. The money must be in your account before you start day trading and you must have a minimum balance of $ 25,000 in your brokerage account at all times during day trading.

Robinhood, Interactive Brokers restrict trading in GameStop, BlackBerry, and other stocks
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