A little-known intermediary in the process of buying and selling equities forced Robinhood and other brokers to restrict trading in several securities on Thursday , including Game. Stop, AMC Entertainment, Black. Berry, and Nokia.
Why did Robinhood stop trading in GameStop?
But by most indications, Robinhood and its peers halted trading in Game. Stop out of caution rather than corruption . Robinhood makes money by routing trades from its platform to large brokers, who compensate the company for its order flow. The larger the trading volume, the better for Robinhood .
From Robinhood, a company that claims to be “democratizing finance,” the decision smacks of hypocrisy. But by most indications, Robinhood and its peers halted trading in Game. Stop out of caution rather than corruption . Robinhood makes money by routing trades from its platform to large brokers, who compensate the company for its order flow.
Is the GameStop rally good for Robinhood investors?
From Robinhood’s perspective, the Game . Stop rally is beneficial insofar as it generates revenue from increased trading activity, but it is also extremely risky, because the brokerage platform is lending millions of dollars to retail investors buying a world-historically volatile stock.
You may be asking “What happened to Robinhood?”
Everything to Know. A little-known intermediary in the process of buying and selling equities forced Robinhood and other brokers to restrict trading in several securities on Thursday, including Game. Stop, AMC Entertainment, Black. Berry, and Nokia.
What brokers stopped buying GameStop stock?
Robinhood and Webull were two of the brokers to halt the purchase of Game. Stop stock on Thursday, along with the shares of other companies including AMC and Koss Corporation.
Still, while trading will resume on Friday, trading in Game. Stock remains a high-risk proposition , as the stock’s current share price is not justified by the underlying business activity of the company. If you are considering using Robinhood or another brokerage to buy Game. Stop shares, make sure you understand the dangers of this type of trade.