Robinhood imposed restrictions Thursday that prevent users of the free-trading app from buying shares of GameStop, AMC and other stocks targeted by Reddit traders.
Citing “recent volatility,” Robinhood said it will only allow users to close out their positions in those stocks, which include Best Buy, Bed Bath & Beyond, Express and Nokia.
Following the move by Robinhood, shares of GameStop (GME) lost all of their premarket gains and turned sharply negative.
Robinhood said that it also raised margin requirements for certain securities, a move that can protect the startup from losing money should some of these stocks plunge.
“We’re committed to helping our customers navigate this uncertainty,” the company said in a statement. “We fundamentally believe that everyone should have access to financial markets.”