Interactive Brokers abandons options trading restrictions
Electronic trading major Interactive Brokers Group, Inc. (NASDAQ:IBKR) has beaten retreat on the restrictions on trading in certain securities it introduced on Thursday, January 28, 2021.
In a brief notice disseminated by the online trading company via social media channels late on Friday, the company said:
“All previously announced options trading restrictions have been removed”.
On January 28, 2021, Interactive Brokers put AMC, BB, EXPR, GME, and KOSS option trading into liquidation only due to the extraordinary volatility in the markets. In addition, the company said that long stock positions would require 100% margin and short stock positions will require 300% margin until further notice.
Interactive Brokers said back then it does not believe that the situation will stabilize until the regulators and exchanges intervene.
The change of Interactive Brokers’ stance regarding stock options restrictions occurred several hours after the United States Securities and Exchange Commission (SEC) issued a statement regarding the recent market volatility spike.
The Commission said it will closely review actions taken by regulated entities that may disadvantage investors or otherwise unduly inhibit their ability to trade certain securities. In addition, the SEC said it will act to protect retail investors when the facts demonstrate abusive or manipulative trading activity that is prohibited by the federal securities laws. Market participants should be careful to avoid such activity, the regulator warned.