Re:Robinhood is limiting purchases of stocks: AMC, Blackberr...
by BoorishBears on Thursday January 28, 2021 @12:43PM
(#25945513)
Brokers are covering their asses. You're projecting a positive spin on this when I literally said "this is actively hurting investors"
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Something insane is happening, claims of market manipulation are flying, Congress is saying they're going to investigate, what started as a meme is suddenly picking up more daily volume than SPY...
There's going to be a bloodbath, and their options are:
- do absolutely nothing, watch people get slaughtered. This is what they normally do!
- start removing yourself from the blast radius and pop the bubble, watch people get slaughtered.
The second case still hurts people, it's not some benevolent thing they're doing! They're doing it because it covers their asses a bit.
Because this time with all the tricky stuff happening with claims of manipulation, the insane volatility, the insane publicity, and most importantly the insane volume, they're afraid they might be opening themselves up to some sort of liability.
sec.gov/rules/other/2013/34-69013.pdf
Broker-dealers aren't supposed to hold your hand, but there is guidance that they should provide some meaningful sort of hand rails for retail investors.
Usually they make money either way and sit back, but this time the same way the masses have been concentrated at a stock ticker, the masses (and Congress) could end up concentrated at their door step asking why they let this happen...
They'd rather have AOC threatening to ask why a stock that's been spiked %1,400 in a month was deemed too high volatility for clients than the SEC asking why they let so many people take a bath on a meme gone wild...
-
Something insane is happening, claims of market manipulation are flying, Congress is saying they're going to investigate, what started as a meme is suddenly picking up more daily volume than SPY...
There's going to be a bloodbath, and their options are:
- do absolutely nothing, watch people get slaughtered. This is what they normally do!
- start removing yourself from the blast radius and pop the bubble, watch people get slaughtered.
The second case still hurts people, it's not some benevolent thing they're doing! They're doing it because it covers their asses a bit.
Because this time with all the tricky stuff happening with claims of manipulation, the insane volatility, the insane publicity, and most importantly the insane volume, they're afraid they might be opening themselves up to some sort of liability.
sec.gov/rules/other/2013/34-69013.pdf
Broker-dealers aren't supposed to hold your hand, but there is guidance that they should provide some meaningful sort of hand rails for retail investors.
Usually they make money either way and sit back, but this time the same way the masses have been concentrated at a stock ticker, the masses (and Congress) could end up concentrated at their door step asking why they let this happen...
They'd rather have AOC threatening to ask why a stock that's been spiked %1,400 in a month was deemed too high volatility for clients than the SEC asking why they let so many people take a bath on a meme gone wild...