With the rise of retail investing apps like Robinhood, more individual investors are trading volatile meme stocks like BBBY. Apps make it easy to quickly buy and sell shares, but many newcomers may not fully understand the risks. This article looks at key insights retail investors should know when using investing apps to trade BBBY stock specifically.
Volatility and risk are very high for BBBY currently
As a heavily shorted meme stock, BBBY price swings have been extreme recently, with wild gaps up and down. This makes timing entries and exits precarious. Retail traders should size positions small enough to stomach 50%+ drawdowns.
Beware emotional decision-making biases
Checking portfolio value minute-by-minute on investing apps can lead to impulsive, emotion-driven trading. Have a plan for entries/exits before buying shares.
Understand share borrowing/short selling mechanics
If short selling BBBY, know the associated borrowing costs and risks of forced buy-ins. Monitor short interest levels regularly.
Apps themselves pose certain risks too
Trading outages have occurred on several platforms during recent volatility. And some brokers sell customer order flow data to firms like Citadel.
Retail investors using easy-to-use investing apps to trade speculative stocks like BBBY should exercise caution and educate themselves on the risks involved before putting capital at stake.