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Wall Street is about to see its biggest trading change in years
Buying or selling a stock is about to get a lot snappier starting next Tuesday. But that doesn’t mean it’ll get smoother – and some financial firms are preparing to handle any possible bumpiness.
The shortened settlement cycle is partly in response to the 2021 meme stock frenzy, when investors on Reddit sent shares of GameStop and AMC Entertainment soaring to eye-popping heights in a short span of time. “The existing two-day period to settle trades exposes investors and the industry to unnecessary risk and is ripe for change,” Robinhood CEO Vlad Tenev said in a February 2021 release. The plan was ordered up by the Federal Aviation Administration in late February after a hole blew open in the side of an airborne 737 Max a month earlier, reports my colleague Gregory Wallace.
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