Xinhua News Agency, Beijing, January 30 (China Securities Journal reporter Zhou Lulu) US stock "retail investors" once again interpreted "unity is strength".
At the beginning of the US stock market on January 29, WSB concept stocks made a comeback, collectively violently rose, and GameStop once rose 112.3%. According to Wind data, as of 22:45 Beijing time, GameStop, Gauss Electronics, AMC Entertainment Holdings and BlackBerry rose by 85.84%, 27.38%, 62.80% and 11.60% respectively.
Source: Wind
Just before the opening of the US stock market, the "big short seller" Citron completely surrendered and announced that it would "stop short selling research and focus on long trading."
htmlOn January 29, an open letter written by an investor to short institutions on the WSB forum flooded the screen around the world. Subsequently, several brokerages, including Tiger Securities and Futu Securities, announced the lifting of trading restrictions on WSB concept stocks. The "short squeeze war" that has continued to ferment in recent days has also made the founder of WSB call it "unprecedented".On the evening of January 29, Beijing time, the US Securities and Exchange Commission issued a statement that it is closely monitoring extreme price fluctuations and will review entity behaviors that limit trading capabilities, and strive to protect investors to maintain market fairness and protect retail investors from the influence of manipulation of trading.
Citron announced that it would stop shorting research
The famous American short selling agency Citron completely surrendered.
On the evening of January 29, Beijing time, Citron announced on Twitter: "After focusing on short selling research for 20 years, it will stop short selling research and will focus on providing long trading opportunities for retail investors."
data shows that Citron was established in 2001 and is one of the influential short selling institutions in the United States. In recent years, Chinese stocks have been sniped many times. The methods commonly used by Citron are: First, thoroughly investigate the loopholes and gaps caused by the differences in financial audits between China and the United States, mainly including false reporting of sales revenue; second, check the misconduct of corporate executives; third, monitor whether the company complies with procedures and regularly report to regulatory agencies and public investors in accordance with regulations.
It is understood that Citron has shorted more than 20 Chinese companies including New Oriental, China Biologics, Qihoo 360, and China Evergrande since 2006.
Among them, Citron's "famous work" appeared in 2011, forcing Southeast Rongtong to delist within four months.
In April 2011, Citron released a short sale report on Southeast Rongtong, believing that the company's profit margin was fake. Southeast Rongtong's stock price fell 13% on the same day; in May 2011, Deloitte and Southeast Rongtong terminated their audit relationship; in August 2011, Southeast Rongtong retreated into the pink order market, with the stock price at that time of US$0.78, down 95.9% from before the suspension, and the market value of US$1.3 billion was wiped out.
However, Citron also fails. On June 21, 2012, Citron released a report saying that Evergrande Real Estate used accounting methods to cover up the problem of insolvency. Evergrande Real Estate denied and refuted these statements at the time, and issued an announcement saying that the content of Citron's report was incorrect and then called the police. In the end, the Hong Kong Securities Regulatory Commission ruled that Citron used exaggerated words and spread false information to short it in the report, and ruled that its founder Left was banned from entering the Hong Kong market within five years.
brokers lift trading restrictions
Before Citron announced its complete surrender, many brokers had chosen to let go and lifted the trading restrictions on related stocks before the opening of the US stock market on January 29.
Tiger Securities said that due to strong demand from investors, it supported GameStop, AMC Entertainment Holdings, and Gauss Electronics' underlying stock opening trading on the 29th. Robinhood, an American zero-commission online broker, known as the "U.S. retail investor base", said that customers encountered bank account connection problems in the early stage, and now they have been solved and all systems can operate normally. German broker Trade Republic lifted trading restrictions on GameStop and Nokia. Futu Securities said that the stock transactions between GameStop and AMC Entertainment Holdings have resumed.
However, the "drag-up" behavior of securities companies has become the focus of market attention and has also become the target of "strike" by WSB users.
Robinhood CEO Vlad Tenev shouted "injustly" in an interview with CNBC, saying that trading restrictions are not to help short sellers, but are restricted by funding requirements of brokers stipulated by the US Securities and Exchange Commission (SEC). He also said that the move to restrict some speculative transactions is in the best interest of the company and its millions of users, “We have to limit the purchase of these stocks to protect the company and our customers."
" Robinhood is a brokerage firm and we have many financial requirements. We have the SEC's net capital requirements and clearing house deposit requirements. Some of these requirements will change dramatically as markets fluctuate. Stocks that are stopped trading are highly unstable. "Vlad Tenev said.
Vlad Tenev also emphasized that Robinhood's decision was not instructed by market makers or hedge funds, "of course, Robinhood represents an ordinary trader. From the very beginning, we supported these average investors to enter the market. Having to impose these restrictions is also a painful thing for us. We will do our best to make these stocks trade as soon as possible. "Anthony Denier, CEO of
trading platform Webull, also gave a similar response: "This is not our subjective choice." The clearing house called us and said that we could no longer allow new positions in the stocks of AMC, GameStop and Gauss Electronics. This is just a result of high volatility and is not a political decision, but unfortunately, it still involves political influence. ”
Interactive Brokers Chairman and Founder Thomas Peterffy responded in an interview with CNBC: “Simply put, we are worried about the integrity of the market and the system. "The founder of
WSB spoke out: unprecedented
WSB forum has been completely popular all over the world. Its founder Jaime Rogozinski also accepted an interview with CNN on January 28 local time and spoke out for the first time on this matter.
Jaime Rogozinski said, "This incident happened too quickly, and many people followed, commented, and looked for precedents. But it was found that this incident was unprecedented, and many people and technology intervened at the same time, which had become a conflict between some kind of system. "
" This is obviously an abnormal situation," Jaime Rogozinski said, "but at the regulatory level, government level or forum, it is not ready to handle it properly." He also said that he would not intervene in the skyrocketing gameStop stock price and enjoy the role of being a bystander.
In addition, Jaime Rogozinski also said that the original intention of WSB forum was to be "fun". He said that traditional financial forums and professional investment bank analysts are often too rational and restrained, and they focus on net present value, cash flow and price-to-earnings ratio. Therefore, Jaime Rogozinski decided to create a sub-forum on Reddit to bring like-minded people together to discuss the types of transactions that will make financial advisers tremble. Their motto is “YOLO”, which is “You Only Live Once”.
In addition, for this matter, Social Capital CEO Chamath Palihapitiya said, “What you need to understand is that retail investors and institutions are playing fairly, and that’s what’s happening, and institutional investors in the United States must accept the fact that this is where the market is going. ”
[Error Correction] [Editor in charge: Nie Chenjing]
