• Why could customers sell but not buy?

  • Sources:

    When customers are allowed to sell but not buy, it typically occurs due to compliance and regulatory issues, as explained by during a discussion on the . , the CEO of Robinhood, clarified that the decision is based on a few key reasons:

    1. Regulatory Compliance: Ensuring that the firm remains compliant with laws to avoid more severe consequences, such as halting all trading activity, which would badly affect customers 1.
    2. Customer Protection: Allowing customers to sell but not buy helps prevent scenarios in which customers might be unable to close their positions during volatile market events. This prevents potential financial loss at critical times 1.

    This approach helps manage risks and maintain stability during unexpected market fluctuations, ensuring a degree of customer protection and regulatory adherence.

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