Shares of Robinhood and Webull rose after the Securities and Exchange Commission approved a plan removing a key restriction on day-trading.
Robinhood rose 7.4% in premarket trading, while Webull gained 9.3%.
The plan will eliminate the current minimum equity requirement of $25,000 for traders to make more than four day-trades in a five-day period and replace that restriction with intraday margin requirements.
The Financial Industry Regulatory Authority, which proposed the changes, said the current requirements are largely in place due to the rationale that commission costs would undermine returns when investors over-traded in their accounts. But since customers today have access to zero commission trading, that rationale no longer applies, FINRA said.
FINRA said that with the removal of restrictions, more retail investors may participate in the markets.
Write to Nicholas G. Miller at nicholas.miller@wsj.com.
Robinhood Markets, Inc. specializes in the operation of mobile investment and financial services platforms for institutional investors and individuals. The group operates an online investment platform that allows clients to invest commission-free in stocks, Exchange Traded Funds (ETF), underlying assets, American Depository Receipts (ADRs), and to purchase shares in an initial public offering (IPO). At the same time, through its platform, the group offers automated transfer services of financial securities from a third-party trading account to the Robinhood trading venue. In addition, Robinhood Markets, Inc. operates a cryptocurrency trading platform (Bitcoin, Bitcoin Cash, Bitcoin SV, Dogecoin, Ethereum, Ethereum Classic and Litecoin) taking charge of real-time market data for 8 crypto-currencies. In addition, the group has a premium subscription platform allowing subscribers to access additional features (instant access to deposits, in-depth research reports on approximately 1,000 stocks via Morningstar, Nasdaq stock data, margin investing, securities lending, etc.), and a cash management platform. Net sales break down by type of income as follows:
- revenue from transactions (58.8%): primarily transactions in trading stock options (42.7% of revenues), cryptocurrencies (34.3%) and equities (11.5%);
- net interest income (37.6%): including interest income on securities lending operations, margin lending, margin loans, and cash and securities under separate management;
- other (7.4%).
At the end of 2025, Robinhood Markets, Inc. had USD 322.1 billion of assets under custody on behalf of 27 million monthly active users.
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