Many individual investors are planning to shun the stock
market debut, and several posts in recent days urging users to not buy into the
IPO have received thousands of upvotes, discussions in online forums on Reddit
showed.
“Just ignore the Robinhood IPO entirely,” said a post on the
r/Superstonk subreddit, which also advised traders to transfer out to
Fidelity’s trading platform.
Robinhood, which has reserved shares in the IPO for retail
investors, declined to comment.
The company came under scrutiny after this year’s trading
frenzy in the so-called meme stocks such as GameStop. Its handling of the
frenzy, marred with glitches and followed by trading restrictions, attracted
the wrath of many of its users and U.S. lawmakers.
Since then, a number of threads on social media forums have
called for users to boycott the platform entirely.
“Just forget Robinhood altogether. Let them go down in
lawsuits and loss of customer base,” said another recent post with more than
7,000 upvotes.
Another Redditor said, “Robinhood has not even been able to
keep their app working properly, has not been able to fill orders promptly, has
consistently provided incorrect info to users about their trades.”
Robinhood experienced crypto trading and display issues on
its platform for about an hour late on Friday.
Last week, Robinhood filed for its widely anticipated market
flotation that revealed massive user growth while also flagging a number of
investigations by prosecutors and regulators.
Earlier this year, the trading app operator launched a new
platform to provide retail investors with the opportunity to buy shares in
IPOs. Robinhood is reserving 20 percent to 35 percent of its IPO shares for
such investors.
In its IPO filing, the company also warned investors that it
could become a meme stock, saying that large participation from retail
investors could trigger volatility in the trading price of its stock.
Robinhood came under scrutiny after the trading frenzy in
the so-called meme stocks such as GameStop.
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