Robinhood extends trading restrictions to 50 shares

Robinhood has expanded its trading restrictions from 13 securities on Thursday to 50 by Friday afternoon.

Securities on the restricted list range from Starbucks to Rolls Royce as the mobile brokerage app faces higher trading volumes over the weekend than last weekend.

Ticker Security The last change change %
SBUX STARBUCKS Corporation 96.81 -1.34 -1.37%
RR No No No No

Robinhood did not immediately respond to an investigation by Fox Business, but its website points users to a Thursday blog post for more context about the restrictions.

“As a brokerage firm, we have several financial requirements, including SEC net capital obligations and clearinghouse deposits,” the post reads. “… these requirements exist to protect investors and markets, and whatever measures we have today, we take their responsibility seriously.”

ROBINHOOD RIVAL APPS AMATEUR To facilitate mobile business for investors

The mobile brokerage app came under scrutiny on Thursday as it was initially announced that it was “restricting transactions to only close certain securities in a position,” including Gamestop, AMC, Nokia and 10 others.

Robinhood App on a smartphone in New York. (AP Photo / Patrick Sesan)

In a Thursday evening statement, Robinhood founder Vladimir Tenev said the limited purchase of limited securities will be allowed in the app starting Friday and “will continue to monitor the situation and make adjustments as necessary.”

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Users can purchase a maximum of one share for the majority of securities on Robinhood’s restricted list and five shares for other securities on the list, such as Rolls-Royce. The company’s website notes that “limits may be subject to change throughout the day.”

“We cannot control … the rapid spread of information and misinformation on social media and for this I deeply regret my customers and employees,” Tenev said on Thursday.

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The sanctions were reduced amid an unexpected rise in share prices that short-sellers were expecting to fall. Retail investors conducted by online Reddit forum WallStreetBets piled into stocks ranging from GameStop to Blackberry and Bed Bath and Beyond, creating a surge in trading volume this week.

Ticker Security The last change change %
GME GAMESTOP CORP 325.00 is +131.40 + 67.87%
Bibi Blackberry Limited 14.10 From -0.55 -3.75%
BBBY Bed & Beyond INC Inc 35.33 +1.69 + 5.02%

Some users of the app have joined a class-action lawsuit against Robinhood accusing the company of knowingly and voluntarily restricting certain securities transactions, which puts investors at risk of using the app at a disadvantage.

Read more on Fox Business

Several celebrities and politicians from both sides of the political spectrum condemned Robinhood’s decision to ban trade, and New York Attorney General Letitia James announced Thursday that she was investigating the move.

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