- The share price of Robinhood marked the high of 11% on September 22, 2022 and then fell around 2.7% at the time of closing.
- This sudden change in the price was due to the report published by the SEC.
- According to the SEC report, the regulatory will not ban the payment for order flow.
Stock Price Gain of Robinhood
According to the Bloomberg News report on September 22, 2022, the U.S. regulatory will stop short of banning payment for order flow. This report can seem like positive news for the brokerage firms like Robinhood, Virtu Financial, and Citadel Securities.
Ian Katz, Managing Director of Capital Alpha, shared the information and added “That will be a relief to brokerages — particularly Robinhood — but not a surprise. Also, as we’ve noted since late last year, the much-feared ban probably won’t materialise at all, and if it ever did it would be after several other market structure steps are taken first.
On September 23, 2022, a SEC spokesperson said in a statement, “Chair Gensler said in his recent Congressional testimony that he believes that it’s appropriate to look at ways to freshen up the SEC’s rules to make our equity markets as fair, efficient, and competitive as possible for investors, particularly for retail investors.”
Furthermore, he added “Staff is considering possible recommendations related to best execution; disclosure of order execution quality; the National Best Bid and Offer; minimum price increments (‘tick size’); exchange access fees and rebates; payment for order flow; and order-by-order competition.”
However, on September 21, 2022, Gary Gensler, Chairperson of the U.S. SEC, shared the Tweet as-
The Chief Legal Officer at Robinhood, Dan Gallagher, expressed in a statement “a ban, or other unnecessary, overly complicated market structure rule changes, will only harm the millions of Americans who are now participating in the stock market for the first time.”
Nancy J. Allen is a crypto enthusiast, with a major in macroeconomics and minor in business statistics. She believes that cryptocurrencies inspire people to be their own banks, and step aside from traditional monetary exchange systems. She is also intrigued by blockchain technology and its functioning. She frequently researches, and posts content on the top altcoins, their theoretical working principles and technical price predictions.