On Thursday, heavily traded “squeeze-stocks” tumbled after being banned for purchase by major online brokerage firms. Broker services, such as Robinhood, Webull, Interactive Brokers, and other major providers restricted trading of specific shares due to “to protect the firm and protect [its] customers..
Affected Shares include Gamestop (GME), AMC Entertainment (AMC), BlackBerry (BB) and Express Inc. (EXPR) amongst others. After various hedge funds shorted the shares, they were heavily bought by private investors, causing a series of remarkable short-squeezes.
The decision to halt trading drew attacks from across the political divide, with lawmakers including Ted Cruz, Elizabeth Warren, and Alexandria Ocasio Cortez attacking the decision and some calling for hearings. Heavy criticism also comes from social media, where users felt betrayed by Robinhood for not upholding their pledge to “democratize” investing.
However, after the close of trading, Robinhood announced a limited resumption of trading for these names, causing the shares to once again skyrocket after hours. GameStop was already up over 61% following the announcement.
What are your thoughts? Was Robinhood right or wrong? Share your thoughts below!