Robinhood online brokerage company. Which offers stock trading services through a free application It was filed by users in more than 30 cases after the company blocked investors from acquiring GameStop shares last week. Amidst the fluctuations in stock prices
Part of Robinhood’s total of more than 13 million subscribers have filed lawsuits in federal courts in many states across the United States. Including California, New Jersey, Texas and Florida. The company’s actions violated a number of laws. Including contracts with customers
GameStop’s share price traded at $ 2.80 a share in April last year. At that time The company announced it would close more than 300 stores amid a massive debt crisis it faces.
Hedge funds saw GameStop’s financial problems and speculated that the company would close soon. Therefore short selling the said shares It is expected to be able to make a profit. If the company’s share price continues to fall
However, retail investors in the room WallStreetBets More than 7.6 million members on the Reddit forum express their displeasure at the hedge fund’s behavior. Together, they pushed GameStop’s share price higher to pressure the hedge fund to re-buy it at a high price. After selling short before
The synergy of such small investors This caused GameStop’s share price to jump 400% last week. While rising 1,700% since the beginning of this year As a result, the hedge fund suffered heavy losses. It is expected to be as high as 19,000 million dollars or about 570,000 million baht.
However, as GameStop’s share price was up, Robinhood announced that it blocked investors from buying GameStop shares on Jan. 28, allowing them to sell their holdings. But will not be able to buy new shares It has frustrated investors, saying Robinhood is stalking a spike in GameStop’s share price to help hedge funds from further losses. While GameStop’s share price plunged more than 60 percent in trading on the day.
Brendon Nelson, one of the plaintiffs who filed the lawsuit against Robinhood, said in the indictment: “Robinhood had deliberately blocked GameStop’s shares and intended to manipulate the market. It breached the contract by refusing to disclose that it was randomly removing profitable stocks from its trading platform.
Nelson claimed that Robinhood’s actions had cost him the opportunity to acquire GameStop shares as the stock price soared.
Robinhood said the measures were aimed at curbing market volatility. And protect investors The company complies with the regulations of the Stock Exchange. And risk management
Later on Feb. 1, Robinhood allowed investors to buy one GameStop share and buy five options contracts, while at the latest, Robinhood allowed investors to buy 500 such shares. share
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