Nuked Robinhood tells the verge that it did n’t sell off full shares of buzzy stocks without permission from its traders. Gamestop, AMC, and other buzzy stocks did n’t get permission from traders.
Robinhood users say the app unexpectedly sold off their stake in some of these companies. Users did n’t believe they had prompted the sales, and they were n’t aware of anything on their account that would have automatically triggered them.
Jett Flores said he was holding stock in GameStop and AMC through Robinhood. He said he would n’t have put the stock at $ 197 when it had just been almost $ 500.
A spokesperson for Robinhood said the small sellers are wrong about how their shares were sold.’I can confirm that claims that Robinhood proactively sold customers’ shares outside of our standard margin-related sellouts or options assignment procedures are false,’ he said.
Robinhood warned some investors with options in GameStop and AMC that it may automatically sell off their stakes to reduce risk. But these investors told the verge they did n’t have options in the GameStop or AMC and had n’t purchased the stocks on margin. They had purchased the shares outright, and were planning to hold onto them.
Margin orders occur when an investor borrows money to complete a sale. Brokers can call in those shares if they’re worried the investor ca n’t pay up. Most of its actions have been calling in options to purchase shares.
Six traders sent screenshots showing their stock in these companies had been sold. Four clearly indicated that they were sold today. The app displays a message saying,’we’ve received your order to sell [ # ] stock at the best available price’.
Gamestop’s stock was faltering from a nearly $ 500 high. The traders had been planning to keep the stock for longer.
‘it’s extremely dishonest trade on their part and unacceptable,’ says Ian q.. Robinhood unexpectedly sold his shares in GameStop this morning.
The surprise selloff is n’t happening to everyone – plenty of people on the r/wallstreetbets subreddit say they were n’t impacted. Robinhood’s terms of service grant it permission to close a trader’s position under a number of circumstances.
Robinhood blocked new purchases of stock from GameStop, AMC, BlackBerry, Nokia, and others that were spiking in large part. The company is now facing widespread backlash from users, celebrities, and politicians.
