WTF GUISE, THIS IS INSANE, LETS CHANGE ALL THE RULES BECAUSE LITTLE PEOPLE ARE TRYING TO RUIN OUR MONEY STEALING
Trading Platforms Curb Movements in Volatile Shares After Retail-Driven Run-Up in GameStop, AMC
BY MT Newswires
— 11:44 AM ET 01/28/2021
11:44 AM EST, 01/28/2021 (MT Newswires) – Electronic brokerages took steps to restrict trading in shares that have seen a surge in activity driven by retail traders fueled by online chat group Reddit in recent days, including GameStop ( GME
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) , AMC Entertainment ( AMC
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) and BlackBerry (BB).
"We continuously monitor the markets and make changes where necessary," closely held stock trading app Robinhood said in a statement on Thursday. "In light of recent volatility, we are restricting transactions for certain securities to position closing only."
Robinhood said the move also includes retailers Bed Bath & Beyond ( BBBY
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) and Express (EXPR), headphones and speakers maker Koss ( KOSS
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) , intimate apparel and swimwear maker Naked Brand ( NAKD
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) and communications equipment maker Nokia ( NOK
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) .
Members of Reddit's Wallstreetbets board rallied around GameStop ( GME
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), a Grapevine, Texas-based retailer of video games and consoles, sending shares up more than 1,300% over the past month. GameStop ( GME
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) sank more than 60% on Thursday after closing above $347 on Wednesday. Movie-theater chain AMC also sank 60% in morning trading, but was still up more than 300% over the past month.
Interactive Brokers Group ( IBKR
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) said Thursday that it put AMC, BlackBerry, Express, GameStop ( GME
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) and Koss ( KOSS
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) option trading "into liquidation only due to the extraordinary volatility in the markets," according to a statement.
"Long stock positions will require 100% margin and short stock positions will require 300% margin until further notice," the trading platform said."We do not believe this situation will subside until the exchanges and regulators halt or put certain symbols into liquidation only."
The companies that have been the focus of the retail traders were said to be heavily shorted, where investors take positions in shares on expectations that the price will later decline. In a note on Wednesday, Dan Wantrobski, technical strategist at Janney Montgomery Scott, said the run-up in heavily shorted consumer names pushed the SPDR S&P Retail (XRT) exchange-traded fund "into parabolic mode" recently. The ETF was down 11% on Wednesday.
"It would appear, in looking at the research that breaks down generational participation, that the pandemic-induced lockdown has pushed many younger cohorts (such as Millennial and GenZ) into 'gaming mode,' where online market conduits such as Robinhood and Reddit are seeing their daily traffic increase exponentially," Wantrobski said. "Perhaps just as swiftly though are the number of naysayers (Boomer bears) mobilizing to label what they now see as a pending bubble in equity prices."