What are the odds of a flash crash in the next week as a result of this activity? The system of banks and market makers and clearing houses is a always way more coupled than the the owners let on... history shows they don't know how to risk manage these sorts of situations.
Statement of SEC Regarding Recent Market Volatility
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Re: Statement of SEC Regarding Recent Market Volatility
#12"The Commission will closely review actions taken by regulated entities that may disadvantage investors or otherwise unduly inhibit their ability to trade certain securities. In addition, we will act to protect retail investors when the facts demonstrate abusive or manipulative trading activity that is prohibited by the federal securities laws. Market participants should be careful to avoid such activity." This shoul…
And their investors...this could (not will, could) end up being a fairly easy case for piercing Robinhood's corporate veil.
Good on the SEC for stating they stand with retail investors, even if it ends up being hollow it sure is nice to hear them say it.
Re: Statement of SEC Regarding Recent Market Volatility
#13"The Commission will closely review actions taken by regulated entities that may disadvantage investors or otherwise unduly inhibit their ability to trade certain securities. In addition, we will act to protect retail investors when the facts demonstrate abusive or manipulative trading activity that is prohibited by the federal securities laws. Market participants should be careful to avoid such activity." This shoul…
It specifies trading activity . I read this as a warning to WSB, not their brokerages.
People who are anti-robinhood thinks it’s a message to RH.
Those who are anti-WSB thinks it a warning to WSB.
Re: Statement of SEC Regarding Recent Market Volatility
#14"The Commission will closely review actions taken by regulated entities that may disadvantage investors or otherwise unduly inhibit their ability to trade certain securities. In addition, we will act to protect retail investors when the facts demonstrate abusive or manipulative trading activity that is prohibited by the federal securities laws. Market participants should be careful to avoid such activity." This shoul…
It specifies trading activity . I read this as a warning to WSB, not their brokerages.
No. WSB is not "a regulated entit[y]" that "disadvantage[d] investors or otherwise unduly inhibit[ed] their ability to trade certain securities". Robinhood is and did.
Re: Statement of SEC Regarding Recent Market Volatility
#15"The Commission will closely review actions taken by regulated entities that may disadvantage investors or otherwise unduly inhibit their ability to trade certain securities. In addition, we will act to protect retail investors when the facts demonstrate abusive or manipulative trading activity that is prohibited by the federal securities laws. Market participants should be careful to avoid such activity." This shoul…
It specifies trading activity . I read this as a warning to WSB, not their brokerages.
> we will act to protect retail investors when the facts demonstrate abusive or manipulative trading activity
Specifically calls out retail investors (i.e. WSB). I read it the opposite way, but I can see how it could be interpreted as a warning to both.
Re: Statement of SEC Regarding Recent Market Volatility
#16Re: Statement of SEC Regarding Recent Market Volatility
#17"The Commission will closely review actions taken by regulated entities that may disadvantage investors or otherwise unduly inhibit their ability to trade certain securities. In addition, we will act to protect retail investors when the facts demonstrate abusive or manipulative trading activity that is prohibited by the federal securities laws. Market participants should be careful to avoid such activity." This shoul…
It specifies trading activity . I read this as a warning to WSB, not their brokerages.
> actions taken by regulated entities
WSB isn't regulated, that is companies like Robinhood
Re: Statement of SEC Regarding Recent Market Volatility
#18"The Commission will closely review actions taken by regulated entities that may disadvantage investors or otherwise unduly inhibit their ability to trade certain securities. In addition, we will act to protect retail investors when the facts demonstrate abusive or manipulative trading activity that is prohibited by the federal securities laws. Market participants should be careful to avoid such activity." This shoul…
It specifies trading activity . I read this as a warning to WSB, not their brokerages.
WSB is not a regulated entity, but presumably Robinhood is.
Re: Statement of SEC Regarding Recent Market Volatility
#19"Likewise, issuers must ensure compliance with the federal securities laws for any contemplated offers or sales of their own securities."
If GameStop management was thinking of selling some shares to the public (or directly to those who really need shares to cover their shorts) at some crazy price they'll have to be careful.
AMC was lucky to have a lot of convertible debt outstanding which has been converted without any action on their part.
Re: Statement of SEC Regarding Recent Market Volatility
#20What are the odds of a flash crash in the next week as a result of this activity? The system of banks and market makers and clearing houses is a always way more coupled than the the owners let on... history shows they don't know how to risk manage these sorts of situations.
From a distance, this is all a storm in a teacup. It's a small handful of stocks, and every single one in S&P500 is waaaay bigger, in terms of trading volumes and market cap.
Anything can happen, but in finance terms, this is tiny so far.