8 ms·

Robinhood shuts down option buying on $GME and $AMC

4 points by eruleman 6y ago

cable2600 6y ago
Reddit really shook the market.
arcticbull 6y ago
Nah, that's not what happened. This pertains only to the options chain expiring January 29th, i.e. in two days. You can still trade the stock, and you can still close positions you already have open, and you can still open and close positions expiring next Friday or any time after that. RobinHood already doesn't allow you to open new options positions on the day they expire (0DTE). They would have suspended opening positions on the chain on the 29th anyways. All they did way move that date up to the 28th, one day earlier. This is because trading options that close to expiry has a much higher likelihood of assignment (aka pin risk). This is a risk management strategy on their part, nothing more. Generally if you want to trade high-risk stuff like 0DTEs or 1DTEs on GME and AMC you should use a real broker, like InteractiveBrokers.
- Av8or1ab 6y ago
  There is no buy button on the page. I cannot purchase the stock. "This stock is not supported on Robinhood".
  - Av8or1ab 6y ago
    I'm seeing that on BB, BBBY, NOK, NAKD, AMC, and GME.
  - arcticbull 6y ago
    Yep, that's a new development. It looks like APEX Clearing, which Robinhood used to use - and probably still does, though they've been developing their own clearing system at home - has blocked all transactions in these shares.
    - rglullis 6y ago
      Interactive Brokers also stopped trading, Chairman goes on TV to say "will resume when market goes back to normal and GME is again at $17." "Why? Honestly, to protect ourselves." The foxes are guarding the henhouse. They always were, at least now is getting easier and easier for people to see it. But please, continue bashing crypto and those working on it...
      - arcticbull 6y ago
        Yep, I just noticed, oof. This has nothing to do with my opinions on crypto. The level of scamming, stealing and corruption in the crypto market is orders of magnitude higher than anything Peterffy admitted to on CNBC. You know this. Bitfinex literally stole 36% of everyone's assets on deposit when they got hacked in 2016. [1] Not just the asset class that was hacked. All assets. Then they issued "tokens" redeemable for equity in Bitfinex valued at $1 each, which turned a $72 million dollar loss into a $72 million dollar valuation for Bitfinex. Then one of their clowns [Giancarlo Devasini IIRC] is recorded saying "the best way to get your money back is to sell your Bitfinex equity tokens to someone else before they realize what's going on." Of course, Coinbase is widely rumored to have told Bitfinex to get stuffed, and didn't take a 36% haircut at all (an institutional leaving you hanging?! in crypto?! gasp). Why no haircut for Coinbase you might you ask? Because it's fraud, a type of fraud called fraudulent conversion [2]. That behavior is the essence of the crypto space. Peterffy is saying you're welcome to close your position but don't open anything new right now. Do I agree with that? No. Does it hold a candle to anything in the crypto space? Not a chance. I don't criticize most people who are genuinely looking to improve crypto, I think they're misguided and wasting everyone's time, but that's not the same thing. They're free to spend their time how they wish. [1] https://www.reuters.com/article/us-bitfinex-hacked-hongkong/bitfinex-exchange-customers-to-get-36-percent-haircut-debt-token-idUSKCN10I06H https://www.reuters.com/article/us-bitfinex-hacked-hongkong/... [2] https://definitions.uslegal.com/f/fraudulent-conversion/#:~:text=Fraudulent%20conversion%20means%20the%20action,or%20money%20does%20not%20belong https://definitions.uslegal.com/f/fraudulent-conversion/#:~:....
        rglullis 6y ago

4 points by eruleman 6y ago

Reddit really shook the market.

Nah, that's not what happened. This pertains only to the options chain expiring January 29th, i.e. in two days. You can still trade the stock, and you can still close positions you already have open, and you can still open and close positions expiring next Friday or any time after that. RobinHood already doesn't allow you to open new options positions on the day they expire (0DTE). They would have suspended opening positions on the chain on the 29th anyways. All they did way move that date up to the 28th, one day earlier. This is because trading options that close to expiry has a much higher likelihood of assignment (aka pin risk). This is a risk management strategy on their part, nothing more. Generally if you want to trade high-risk stuff like 0DTEs or 1DTEs on GME and AMC you should use a real broker, like InteractiveBrokers.

Av8or1ab 6y ago
There is no buy button on the page. I cannot purchase the stock. "This stock is not supported on Robinhood".
- Av8or1ab 6y ago
  I'm seeing that on BB, BBBY, NOK, NAKD, AMC, and GME.
- arcticbull 6y ago
  Yep, that's a new development. It looks like APEX Clearing, which Robinhood used to use - and probably still does, though they've been developing their own clearing system at home - has blocked all transactions in these shares.
  - rglullis 6y ago
    Interactive Brokers also stopped trading, Chairman goes on TV to say "will resume when market goes back to normal and GME is again at $17." "Why? Honestly, to protect ourselves." The foxes are guarding the henhouse. They always were, at least now is getting easier and easier for people to see it. But please, continue bashing crypto and those working on it...
    - arcticbull 6y ago
      Yep, I just noticed, oof. This has nothing to do with my opinions on crypto. The level of scamming, stealing and corruption in the crypto market is orders of magnitude higher than anything Peterffy admitted to on CNBC. You know this. Bitfinex literally stole 36% of everyone's assets on deposit when they got hacked in 2016. [1] Not just the asset class that was hacked. All assets. Then they issued "tokens" redeemable for equity in Bitfinex valued at $1 each, which turned a $72 million dollar loss into a $72 million dollar valuation for Bitfinex. Then one of their clowns [Giancarlo Devasini IIRC] is recorded saying "the best way to get your money back is to sell your Bitfinex equity tokens to someone else before they realize what's going on." Of course, Coinbase is widely rumored to have told Bitfinex to get stuffed, and didn't take a 36% haircut at all (an institutional leaving you hanging?! in crypto?! gasp). Why no haircut for Coinbase you might you ask? Because it's fraud, a type of fraud called fraudulent conversion [2]. That behavior is the essence of the crypto space. Peterffy is saying you're welcome to close your position but don't open anything new right now. Do I agree with that? No. Does it hold a candle to anything in the crypto space? Not a chance. I don't criticize most people who are genuinely looking to improve crypto, I think they're misguided and wasting everyone's time, but that's not the same thing. They're free to spend their time how they wish. [1] https://www.reuters.com/article/us-bitfinex-hacked-hongkong/bitfinex-exchange-customers-to-get-36-percent-haircut-debt-token-idUSKCN10I06H https://www.reuters.com/article/us-bitfinex-hacked-hongkong/... [2] https://definitions.uslegal.com/f/fraudulent-conversion/#:~:text=Fraudulent%20conversion%20means%20the%20action,or%20money%20does%20not%20belong https://definitions.uslegal.com/f/fraudulent-conversion/#:~:....
      - rglullis 6y ago