Democratizing finance for all. This is Robinhood’s app bio on Twitter. And today they made a mockery of themselves. Since Friday last week, retail investors are buying options in GameStop, AMC, Nokia, Blackberry. A lot of call options. Driving the price up of these heavily shorted stocks. This is in response to hedge-funds trying to collapse these good businesses. For their own financial interest of course. This tub of war between retail investors and Wall Street has resulted in massive volatility. And today without warning Robinhood investment app restricted trading with these assets. Positions can be closed. But not opened.
The Free Market
Let the people trade.
— Robinhood (@RobinhoodApp) March 23, 2016
Imagine Robinhood telling all Apple investors. You cannot buy any additional shares. Although, you can close your position. Oh and Google we’ve decided too. And Amazon. But have fun with the others.
Yes, Robinhood will point to the volatility and the alleged market manipulation. But those are baseless claims. Market manipulation is a few people shorting a stock and creating fake negative stories. It is not 2 million fans of a company buying the stock. And taking advantage of bad Wall Street investing decisions. Absolute despicable behavior from Robinhood. Not only have they killed their reputation and brand, but they also set themselves up for an interesting IPO. Make no mistake. Turning 2 million highly motivated, and now quite rich individuals with market know-how against you is a dumb idea. Especially when they are your most profitable clients. Use #deleterobinhood to spread the word.
Read the story on WallStreetBets vs Wall Street here.
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