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Nasdaq CEO Suggests Halt to Trading to Allow Big Investors to
'Recalibrate Their Positions' to Combat Reddit Users

Mediaite logo Mediaite 1 day ago Rudy Takala

Nasdaq CEO Adena Friedman suggested Wednesday that her exchange could
halt trading activity for stocks to enable investors to "recalibrate"
in the event they were targeted by internet users.

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She made the comment in a Morning interview with CNBC's Joe Kernen, 
speaking in reference to price surges inspired by Reddit users.
Members of the website's "WallStreetBets" forum caused stock prices
to surge to obscene heights this week for companies including
GameStop and AMC Theatres.

"I think that, in general, when we evaluate how we would manage
through a situation where you see a significant run-up in a stock not
based on news, not based on fundamentals -- what we do is we do have
technology that evaluates social media chatter. If we see a
significant rise in the chatter on social media channels ... we also
match that up against unusual trading activity, [and] potentially
halt that stock to allow ourselves to investigate the situation, to
be able to engage with the company, and to give investors a chance to
recalibrate their positions."

GameStop, as well as AMC Theatres, appear on the New York Stock
Exchange (NYSE) rather than on the Nasdaq, leaving Friedman powerless
to influence this week's events. But some regulators have called on
the NYSE to halt trading for at least GameStop, including
Massachusetts' top securities regulator, who said the robust
investment activity wasn't "rational."

"I really think at this point it calls upon the regulators, in this
case, the New York Stock Exchange, to consider simply suspending it
for a month and stop trading it," Massachusetts Commonwealth
Secretary William Galvin said in a statement to Barron's. "These
small and unsophisticated investors are probably going to get hurt by
this.

"There's no rational basis for this run-up," he added. "And it's not
just a run-up, it's also run down. It's extremely erratic. Clearly,
there is a problem here with the way that options are being used in
this case. And it needs some regulatory intervention. And I think the
most prudent thing is if it's suspended trading for 30 days."

Watch above via CNBC.

The post Nasdaq CEO Suggests Halt to Trading to Allow Big Investors
to 'Recalibrate Their Positions' to Combat Reddit Users first
appeared on Mediaite.

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