• Media type: E-Book
  • Title: When Brokerages Restrict Retail Investors, Does the Game Stop?
  • Contributor: Jones, Charles M. [Author]; Reed, Adam V. [Author]; Waller, William [Author]
  • Published: [S.l.]: SSRN, [2021]
  • Published in: Columbia Business School Research Paper
  • Extent: 1 Online-Ressource (68 p)
  • Language: English
  • DOI: 10.2139/ssrn.3804446
  • Identifier:
  • Origination:
  • Footnote: Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments June 30, 2021 erstellt
  • Description: We study a set of trading restrictions imposed by Robinhood and other retail-oriented broker-dealers in 38 stocks, including GameStop. Restrictions limit equity and/or options positions. Stock price effects are large, with CARs averaging -13.54% within two hours after a stock’s first trading restrictions and -51.97% after five trading days. When restrictions are lifted, share prices do not rebound. Traders substitute from equities to options. Options volume and open interest spike, as do implied volatilities, which rise more than realized volatilities. Options purchasers overpay, creating large transfers to option sellers and market-makers. Margin increases show similarities and differences versus trading restrictions
  • Access State: Open Access