Isabelle Lee, 01 March 2021
A survey by data analytics firm Invisibly found that 77% of people believe Robinhood’s restriction of certain stocks at the peak of the Reddit-fueled frenzy amounts to market manipulation.
Commission-free trading app Robinhood has faced significant backlash and scrutiny in the weeks since January’s Reddit-fueled short squeeze, with CEO Vlad Tenev grilled by legislators at February’s congressional hearing over the company’s decision to restrict buying of many of the “meme stocks” at the heart of the saga.
The move took the wind out of the momentum trade, and marked the end of January’s retail trader phenomenon.
Now, a recent study by data analytics from Invisibly found that a majority of people surveyed believe Robinhood’s restriction of meme stocks was market manipulation.
The study, which surveyed 1,300 people during the first week of February, also revealed that 39% felt the market mania was “exciting and good” for investors, while 17% felt it was “exciting but a bad investment.”
28% said the trading phenomenon was a positive event, and “shaking things up from time to time is a good thing”, while 15% felt it was detrimental to markets. Meanwhile, 40% of respondents believe that Robinhood and other retail trading services restricted some stocks to help hedge funds.
The survey paints a stark picture of the public’s perception of what transpired in late January, despite Robinhood stating that it restricted trading of some stocks due to clearinghouse requirements.
Keith Patrick Gill (born June 8, 1986) is an American financial analyst and investor known for his posts on the subreddit r/wallstreetbets
At the House Financial Services Committee hearing last week on the GameStop debacle, there was an elephant in the room: naked short selling.
One of the most outspoken retail traders on Reddit’s WallStreetBets discussion board has been targeted in a proposed class-action lawsuit alleging the 34-year-old securities broker behind the widely followed “Roaring Kitty” persona committed securities fraud for misrepresenting himself as an amateur trader online while pumping up GameStop stock prices.
Lawsuits related to the Gamestop Corporation GME 0.1% short squeeze have been stacking up following the volatile trading in the stock in January. 