The saga of GameStop took a dramatic turn overnight as the brokerage app RobinHood resumed trading in the gaming retailer.
Shares of GME exploded higher to more than $400, doubling from Thursday’s close.
RobinHood’s co-founder, Vladimir Tenev attempted to quell the outrage of the firm cutting off trading in GME and a handful of other equity offerings by saying the soaring volatility caused regulatory and fiduciary concerns for the firm.
“We are in a historic situation where there is a lot of activity and a lot of buying concentrated in a relatively small number of symbols that are going viral on social media,” he said.
“So we haven’t really seen anything like this before and to prudently manage the risk and the deposit requirements we had to restrict buying in these 13 stocks,” Tenev told CNN.
However, this did not dampen the outrage of small investors who alleged RobinHood was protecting Wall Street firms caught on the wrong side of the deal by shorting these shares.
Tenev was trying placate some of his broker clients who brought lawsuits in Manhattan federal and state courts to force RobinHood to allow trading in GME and other companies.
Representative Alexandria Ocasio-Cortez, Jon Stewart and Barstool Sports founder Dave Portnoy all jumped into the fray on the side of the small investors taking on the big Wall St. firms.
Putting aside the ramifications caused by Reddit posters, who fostered the short squeeze, GME shares are now so overvalued that caution must be taken for those thinking of getting in. In my way of thinking, GME is not a position I would hold over the weekend. I’m not offering financial advice, just telling you what I would do.