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During the post-trade time interval (“T+
x”) while the instructed trade is executed, cleared and settled, those market participants involved are subject to interim risk (both market and counter-party credit risk). Those interim risks are greater during periods of market stress and high volatility. To protect against those risks, participants in the process require their downstream counter-parties to post cash deposits (“margin”).
DTCC’s subsidiary, National Securities Clearing Corp. (“NSCC”) is an SEC-regulated entity that provides
“clearing, settlement, risk management, central counterparty services and a guarantee of completion for certain transactions for virtually all broker-to-broker trades involving equities, corporate and municipal debt, American depositary receipts, exchange-traded funds, and unit investment trusts.
Exchange Repeatedly Halts Gamestop Trading as Price Surges Past $100 theepochtimes.com - get the latest breaking news, showbiz & celebrity photos, sport news & rumours, viral videos and top stories from theepochtimes.com Daily Mail and Mail on Sunday newspapers.
Robinhood Blocked GameStop Buys After Clearinghouse Threatened $2.2 Billion Charge, CEO Says
Online stock trading platform Robinhood made the decision to ban its users from buying certain stocks last month after the company that clears stock transactions imposed a $2.2 billion special charge on Robinhood. After the ban, the clearinghouse lifted the charge.
Robinhood was popular among the small investors who organized online to buy the stock of GameStop, a struggling computer game retailer. The run was partly motivated by a belief that hedge funds that borrowed and short-sold the stock would be forced to buy it back, thus increasing its price.
Robinhood Lifts Trading Limitations Put on Volatile Stocks Like GameStop
Feb 5 2021 · 13:28 UTC | Updated
Feb 5 2021 · 13:31 by Steve Muchoki · 3 min read
Photo: Depositphotos
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Robinhood had earlier put buy limitations on approximately 13 equities including GameStop, Koss, Express, Nokia, Blackberry and others.
After limiting buy orders from retail traders at the tail end of last week, stock trading platform Robinhood has removed buy limitations put on highly volatile stocks including GameStop Corp (NYSE: GME) and AMC Entertainment Holdings Inc (NYSE: AMC). The company issued an update on its website late on Thursday, saying:
“There are currently no temporary limits to increasing your positions.”