Robinhood’s Trade Volume Record Surpasses $5B Amid Meme Stock Frenzy

Robinhood’s trade volume record surpasses $5B amid meme stock frenzy, driven by retail traders’ intense interest in GameStop. Robinhood, the trailblazer in the American brokerage industry, has once again taken center stage in a new meme stock frenzy. CEO Vlad Tenev announced that Tuesday marked one of the company’s “biggest days in the past 12 months,” with daily equities trading volume reaching $5 billion.

In contrast, Robinhood’s total monthly equities trading volume for April was $70.7 billion, down 17 percent from March’s $87.7 billion. Interestingly, in April 2023, the broker handled just $38.9 billion in equities trading volume. Tenev also announced plans to upgrade Robinhood’s infrastructure to accommodate an “even higher load.”

Retail traders’ renewed interest in GameStop shares sparked this week’s surge in equities trading. The gaming retailer’s stock price soared 74 percent on Monday, followed by another 60 percent on Tuesday, though it pulled back by 30 percent during Wednesday’s intraday trading session. In 2021, retail traders’ enthusiasm for GameStop led to a massive meme stock frenzy, culminating in a short squeeze that caused substantial losses for prominent hedge funds holding short positions. Retail traders, particularly on the subreddit WallStreetBets, drove this extraordinary market event, leaving hedge funds reeling.

Amateur retail investors, notably Keith Gill, known on social media as TheRoaringKitty, sparked the initial frenzy with detailed analyses of GameStop stock. Gill and others identified value in the heavily shorted stock by prominent hedge funds. In contrast, Gill’s return to social media with a cryptic post appears to have solely triggered the latest frenzy.

Surge in GameStop Shares Leads to Robinhood’s Trade Volume Record

Apart from Robinhood, other brokerage firms also experienced a surge in demand for meme stocks. According to data from Interactive Brokers, GameStop ranked as the third most traded stock, trailing only chip-maker Nvidia and electric car maker Tesla.

Similarly, Public, another retail brokerage, acknowledged the recent surge in demand for meme stocks such as GameStop and AMC. However, Nvidia and U.S. Treasurys remained the top-traded assets on the platform. A spokesperson from Public confirmed to MarketWatch that trading volume for GME and AMC surged by 300 percent week-over-week. Moomoo, an online trading platform, also acknowledged an increase in trading volume with meme stocks but did not disclose specific numbers.Meanwhile, eToro, an Israeli broker that is proceeding with a public listing, has temporarily suspended trading with GameStop and AMC.

“When the price of a stock, such as $GME and $AMC, experiences significant volatility, the market where the stock trades, NASDAQ in this case, implements a safety mechanism to temporarily halt pricing. This is to ensure the accuracy and validity of the pricing information,” eToro mentions in its announcement.

“Whilst the trading halts in this instance implements at the exchange level, eToro also adopts such safety mechanisms, meaning from time to time, we may take the decision to temporarily halt prices.”

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