Robinhood stock plunged by over 10% after its initial public offering didn’t go as planned.
The brokerage and exchange platform reserved 20-35% of the available shares for its users before it was offered to the general public.
But it seems they were not exactly fascinated by the opportunity as Robinhood was only able to raise $2 billion, a long haul lesser than the projected $35 billion valuations.
Reasons for the snub reportedly include the risk of regulators’ crackdown on its operations and the lagging investors’ anger from when the brokerage firm restricted trading on some popular stocks back in January.
Last month, Robinhood agreed on a settlement deal worth around $70 million with the Financial Industry Regulatory Authority for “systematic” negligence, providing “false or misleading” information and vulnerable options trading controls.