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They're not reasonable. Just because someone has a short position doesn't mean you can stake a position deliberately to trigger a squeeze and profit from the re
by fnimick 6y ago
They're not reasonable. Just because someone has a short position doesn't mean you can stake a position deliberately to trigger a squeeze and profit from the result. That's exactly what the GME swarm has been doing.
"Although some short squeezes may occur naturally in the market, a scheme to manipulate the price or availability of stock in order to cause a short squeeze is illegal." - https://www.sec.gov/investor/pubs/regsho.htm https://www.sec.gov/investor/pubs/regsho.htm
I wouldn't be surprised if Robinhood and other brokers' compliance teams made the decision that the penalty for shutting down trading was less than the potential fallout for enabling illegal market manipulation behavior. Just because it's coordinated online between individuals doesn't mean that it's not illegal market manipulation.