Schwab clarifies ‘confusion’ over response to trading activity in stocks like GameStop, AMC and Express

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Charles Schwab Corp.
SCHW,
-4.09%
issued Friday a statement, to clarify actions it has taken related to the recent frenzied trading activity stocks, such as those of GameStop Corp.
GME,
+67.87%,
AMC Entertainment Holdings Inc.
AMC,
+53.65%
and Express Inc.
EXPR,
+27.66%,
that have resulted from so-called “short squeezes.” The discount broker said that given the “confusion” about what it and its recently acquired TD Ameritrade have done in response to the recent trading activity, Schwab said: “Neither Charles Schwab & Co. nor TD Ameritrade halted buying or selling of ANY stocks this week. Neither firm restricted buying or selling basic options. Both firms did adjust margin requirements on select stocks to ensure clients had sufficient assets to pay for stock purchases. Both firms also restricted certain advanced options strategies.” For example, Schwab said it began on Jan. 13 the process of changing the margin requirement for GameStop’s stock to 100%, which means Schwab’s clients were restricted from using GameStop shares as collateral for a margin loan. Schwab’s stock dropped 4.9% in morning trading Friday. It has lost 3.6% year to date, while the S&P 500
SPX,
-1.93%
has edged up 0.2%.

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