Robinhood Surges as a ‘Meme Stock’ – But Reddit’s r/WallStreetBets Says ‘Not to Buy’
Robinhood, which started its NASDAQ listing last week under the ticker HOOD in one of the most anticipated and unusual IPOs of the year, and which saw its stock halted several times due to volatility a few days later, is dealing with some backlash from Reddit’s wallstreetbets army.
“I don’t recall seeing any positive post about RH IPO. I only saw negative comments about it on WSB,” one person posted on Reddit.
“I am positively telling anyone i know not to buy $HOOD,” another one replied.
Robinhood was one of the most commented stocks during its IPO week on WallStreetBets, according to The Street.
Some investors are still angry at the fact that earlier this year, Robinhood halted trading of some stocks popular on the Reddit subthread r/WallStreetBets. Retail traders, who were intent on taking down hedge-fund short sellers by buying shares of stocks that didn’t seem to have much of a chance of success, were unable to trade stocks including GameStop, AMC Entertainment and Bed Bath & Beyond. Robinhood said last week that it continuously monitors the markets and makes changes where necessary. “In light of recent volatility, we restricted transactions for certain securities to position closing only,” according to a statement on its website at the time. The company also raised margin requirements for certain securities.
A Reddit user posted simply wrote “Jan 28 #neverforget,” a reference to that day, according to CNN.
In addition, people are angry at the platform’s multiple outages, which let them unable to trade, which prompted several posters suggesting shorting Robinhood stock, CNN reports.
Jonathan Anastas, Board Chair at Alpha Esports Tech, tells GOBankingRates that “there is quite a bit of irony here.”
“Robinhood – the platform for “meme stock” trading, itself became a meme stock, both on upside news of activist investors and on the downside of insider sale intent being filed. Meaning, Robinhood itself is finding high share price volatility like many of the meme stock trades of which the platform found favor on, meaning, end of the day “you can live by the meme, but also die by it.”
Anastas adds that the person who has an active Robinhood account “is the same person who games 7 hours a day and trades alternative currencies and NFTs based on their passions, be it an influencer, an athlete, an artist or a brand.”
“We’re in a generational shift where enthusiast platforms are investments and marketplaces as much as they are places to express one’s passions.
Despite the anger, the stock was up 65% last Wednesday, at $77. HOOD, which had a dismal beginning on its first day on the NASDAQ, had quite the turnaround: the stock was up 120% for the week, according to CNBC.
So far today, HOOD is up 3.7%, at $57.
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