During the pandemic, ordinary people piled into stock markets, many for the first time in their lives. Between January and September, big US retail brokerages E Trade, TD Ameritrade and Charles Schwab saw the total number of average daily trades increase by three quarters to six million, according to Sundial Capital Research.
Lockdown boredom is one explanation for this trading surge. Another is the relative lack of sports betting opportunities and the hunt for returns amid record-low interest rates.
As newcomers flooded into trading, they were drawn to one platform in particular. Robinhood, one of the most high-profile trading apps, reported three million new accounts in the first quarter of 2020. Half of these were first-time traders.
Froth in retail options now dwarfs level of August boom and bust bnnbloomberg.ca - get the latest breaking news, showbiz & celebrity photos, sport news & rumours, viral videos and top stories from bnnbloomberg.ca Daily Mail and Mail on Sunday newspapers.
The ‘ice is cracking’ on the bull market, one stock-market analyst warns MarketWatch 1/30/2021
THE TELL
U.S. stocks have been hanging around record highs recently amid broader participation by individual investors, but now cracks are starting to form in the foundation of the bull market, according to technical analysts at SentimenTrader.
The biggest breakdowns in the positive trend for markets tend to come when fewer stocks are helping to drag benchmarks toward fresh records, the analysts say
“The biggest issues have come when underlying momentum wanes and we see cracks under the surface,” wrote Jason Goepfert, head of SentimentTrader and founder of independent investment research firm Sundial Capital Research, in a research note published Tuesday.
Penny stock Reddit thread cracks down on shills as users surge
Sarah Ponczek, Bloomberg News BC-Penny-Stock-Reddit-Thread-Cracks-Down-on-Shills-as-Users-Surge , via Bloomberg
The explosion in penny stock trading has been so abrupt that a Reddit thread devoted to it has been forced to update regulations to curb user shilling.
âTHE RULES HAVE BEEN UPDATED! TAKE NOTE!,â blared a post in r/pennystocks Wednesday night. Among the tweaks were changes to the type of content permitted in the thread and the official banning of cryptocurrency-related chatter.
Social media platforms and websites such as Reddit have become must-reads for the Wall Street stock set these days. A forum called r/wallstreetbets, which boasts 1.9 million users, has shown an astonishing ability to move prices. In less than a year, 1 million new users have joined. Now, with penny stocks surging last month, more than 1 trillion shares of tiny,
Market newbies discover penny stocks, and 1 trillion shares get traded
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By Sarah Ponczek and Elena Popina
January 15, 2021 1.28pm
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In New York, there s Broadway, off Broadway, and off-off Broadway. A similar hierarchy exists in the modern equity market, and it s in the third category of way-off-exchange trading where today s retail speculator is really going to work.
While there have been many examples of trading volume explosions in low-priced NYSE and Nasdaq stocks in the last few months, a whole other ecosystem of speculation exists outside the regulatory reach of these venues and it s been booming. Out past the broker-operated venues where Robinhood trades get executed, it s lightly regulated quotation systems run by firms like OTC Markets, where more than 1 trillion shares in some of the riskiest companies changed hands last month.