Securities regulators said Friday they plan to closely review the actions of some brokerage firms [Editor’s note: the link may be paywalled; alternative source] that restricted investors’ ability to trade volatile stocks such as GameStop this week. From a report: The Securities and Exchange Commission’s statement on Friday is the clearest indication yet that regulators are examining potential misconduct around the trading mania that swamped stocks such as GameStop, AMC Entertainment and Novavax. Robinhood Markets restricted investors’ ability to purchase shares in GameStop and 12 other companies on Thursday as it dealt with the impact on its financial requirements of a surge in trading. Robinhood raised $1 billion to shore up its ability to clear and execute trades in those popular and volatile stocks, which the broker on Friday allowed clients to resume trading. Regulators also said they are on the lookout for potentially manipulative trading. This week’s sharp price swings have been aided by bullish individual traders communicating on websites such as Reddit’s WallStreetBets about which shares to buy. Traders drove up demand for stocks that other investors such as hedge funds had bet against, resulting in a “short squeeze” that ramped up the prices of GameStop more than 10-fold.
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Source:: Slashdot