Local broker survives billion-dollar stock surge amid GameStop frenzy

Low-cost broker Stake says its platform survived a major test on Monday evening as it dealt with an unprecedented volume of transactions that has seen more than $1 billion worth of US stocks traded on its platform in just over a month.

Stake, which allows local retail investors to buy US stocks, said its platform was “healthy” despite more than 54,000 trades being executed through its platform which suffered service problems last week amid the global trading frenzy around stocks like GameStop. The chaos was triggered by a day trader revolt against major Wall Street short-sellers.

“There was some isolated latency issues to downstream partners feeling some strain from the record-breaking volumes we’re seeing in the markets,” said Stake chief executive Matt Leibowitz of Monday’s trading performance.

GameStop has been at the centre of a trading frenzy as a chatroom-inspired army of retail investors took on hedge funds which were shorting the stock. Credit:Bloomberg

He said Stake worked through the weekend to try and fix performance issues and deal with the incredible surge in trading activity that saw $US813 million ($1 billion) worth of stocks traded through the platform in the first weeks of the new year.

As a platform to buy US stocks, Stake has been caught up in the international sharemarket frenzy surrounding struggling US video game retailer GameStop and other stocks such as AMC.

Stake is one of many brokers that have struggled under the unprecedented volume of transactions from customers. Major US brokers such as Charles Schwab, Vanguard Group and Fidelity Investments also reported service disruptions.

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