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 $AMC, $BB, $BBBY, $EXPR, $GME, $KOSS, $NAKD and $NOK. We also raised margin requirements for certain securities.’
According to our friends at The Verge, Robinhood aren’t the only app based trading company to restrict trading on GameStop; with traditional brokerages such as TD Ameritrade, Charles Schwab also imposing similar restrictions.
The actions come 24 hours after it emerged that GameStop had surpassed Apple, Tesla, Amazon and Microsoft to become the most traded stock yesterday.
The rise of GameStop has taken Wall Street by storm in recent days, after a group of tech-savvy Reddit users joined forces to increase the video game retailer’s share price tenfold in a matter of weeks.
Redditors became aware that Melvin Capital had shorted GameStop’s shares thus betting against its success; meaning that they stood to gain if GameStop value went down and lose if it went up.
Noticing irregularities too detailed for the scope of this article, Reddit members quickly started to flip the script and pile into Gamestop so Melvin Capital would be hit by the huge losses and the money they had invested would be redistributed to them.
The latests developments have come with backlash from the core WallStreetBets members; who originially initiated the GameStop short squeeze.
‘Individual investors are being stripped of their ability to trade on @RobinhoodApp,’ the group’s moderator wrote on Twitter today.
‘Meanwhile, hedge funds and institutional investors can continue to trade as normal. What do you call a market that removes retail investors ability to buy to save institutional investors shorts?’ the tweet said.
Yesterday Discord also banned the group from its platform, but claimed the suspension was due to ‘hateful and discriminatory content after repeated warnings’ and nothing to do with the recent stock market activity.
WallStreetBets, which propsitions itself a ‘platform for the people to speak truth to power in the financial world’, released a statement on Twitter that it is ‘tired of being run over by the big guys’ of Wall Street.