Anybody following the drama surrounding Robinhood is aware of simply how a lot of a large number it is change into. For these not conscious, the cell funding app has been below hearth after it halted buying and selling to quite a few firms after they noticed their shares surge. Many individuals weren’t pleased with the choice, calling it market manipulation, and even prompting a lawsuit against Robinhood. One other results of the drama is the app noticed its ranking drop on Google Play Retailer following a swarm of damaging opinions.
In keeping with 9to5Google, the Robinhood app was sitting fairly at 4 stars, which then tumbled all the way in which down to at least one star. Apparently, Google caught wind of what was occurring and ended up eradicating over 100,000 damaging opinions, which introduced the app again to its pre-WallStreetBets ranking.
The Reddit group /r/WallStreetBets is basically answerable for the surge in buying and selling for a number of firms, which included Nokia, AMC, Blackberry, and extra. For instance, GameStop, which has been struggling to survive the impact of the pandemic, went from $19 firstly of the yr to simply lower than $100 on January twenty sixth, and since then rose to a whopping $467 on the top of the buying and selling spree as we speak. The transfer was to drive a loop that may see the shares develop by squeezing out giant traders who have been short-selling these shares, which compelled them to purchase and drove the inventory larger.
The transfer to halt buying and selling was seen as market manipulation and a option to defend Wall Avenue hedge funds. Amid the backlash, Robinhood issued a statement about their choice:
Amid this week’s extraordinary circumstances out there, we made a troublesome choice as we speak to briefly restrict shopping for for sure securities. As a brokerage agency, we’ve many monetary necessities, together with SEC internet capital obligations and clearinghouse deposits. A few of these necessities fluctuate based mostly on volatility within the markets and might be substantial within the present surroundings. These necessities exist to guard traders and the markets and we take our duties to adjust to them critically, together with via the measures we’ve taken as we speak.
We might earn a fee for purchases utilizing our hyperlinks. Learn more.