Brokerages and other trading platforms took matters into their own hands Thursday amid unprecedented volatility in certain stocks.
GameStop Corp. GME, AMC Entertainment Holdings Inc AMC and other high-flyers were among the stocks blocked on certain brokerages. Here’s a breakdown of who did what.
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Robinhood said in a statement “In light of recent volatility, we are restricting transactions for certain securities to position closing only, including $AAL, $AMC, $BB, $BBBY, $CTRM, $EXPR, $GME, $KOSS, $NAKD, $NOK, $SNDL, $TR, and $TRVG. We also raised margin requirements for certain securities.”
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A statement from Interactive Brokers said: “As of midday yesterday, Interactive Brokers has put AMC, BB, EXPR, GME, and KOSS option trading into liquidation only due to the extraordinary volatility in the markets. In addition, long stock positions will require 100% margin and short stock positions will require 300% margin until further notice. We do not believe this situation will subside until the exchanges and regulators halt or put certain symbols into liquidation only. We will continue to monitor market conditions and may add or remove symbols as may be warranted.
Go to Interactive Brokers.
A spokeswoman for TD Ameritrade, recently acquired by Charles Schwab, told Marketwatch “In the interest of mitigating risk for our company and clients, we have put in place several restrictions on some transactions in $GME, $AMC and other securities. We made these decisions out of an abundance of caution amid unprecedented market conditions and other factors.”
Meanwhile, a Charles Schwab spokesman told the outlet it had “restrictions in place on certain transactions in GME and other securities.”
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As of early Thursday afternoon, it did not appear as if E*TRADE or WeBull had made formal announcements. Webull CEO Anthony Denier told the Benzinga Power Hour however that the firm was told Thursday morning that its clearing firm would not be able to clear trades in GME, AMC, and KOSS.
"The reason why our clearing firm is not able to support clearance in those specific symbols is simple," he told Benzinga. "When we're talking about GameStop at $250, $300, billions of shares trading, we're talking about hundreds of billions of dollars, physically, has to send in cash to hold there for two whole business days. And to be frank, the clearing firms are not that well-capitalized, they cannot do that. So in order to stop the clearing firm from going out of business, they stop the settlement of those shares, resulting in firms like Webull not being able to allow customers to trade those stocks. It's a market dynamic."
Watch the full conversation with Anthony Denier below.
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