Robinhood (Nasdaq: HOOD) on Monday temporarily suspended its overnight trading service due to issues with its execution partner, Blue Ocean ATS. The announcement came through Robinhood’s social media channels, informing users that the 24-hour market would be unavailable.
Blue Ocean ATS, the third-party firm responsible for facilitating Robinhood’s round-the-clock trading, has halted its overnight operations. As a result, any open orders placed after 8 p.m. ET will be processed starting at approximately 4 a.m. ET the following day.
Robinhood has assured its customers that they can cancel existing orders or place new ones for future trading sessions.
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A spokesperson for Blue Ocean ATS revealed that the suspension was prompted by capacity issues experienced the previous night, which led to the cancellation of a small percentage of trades. The firm plans to migrate to a new technology system within the next two weeks to address these concerns.
This disruption comes at a time when global markets are experiencing significant volatility. Monday saw a steep sell-off, with major indices such as the Dow Jones Industrial Average and the S&P 500 recording substantial losses.
Notably, it wasn’t just Robinhood having problems. Nearly 14,500 Schwab users and over 3,600 Fidelity users reported problems, according to outage tracking website Downdetector.com. Charles Schwab acknowledged the issue on its X account, apologizing for login difficulties. The firm later announced at 12:38 p.m. ET that the issue had been resolved.
The Securities and Exchange Commission (SEC) said it was actively monitoring the situation for orderly market functioning. These technical problems, often triggered by extreme market volatility, have raised concerns about brokerages’ capacity to handle high volumes and have frustrated retail investors looking to adjust their positions.
As X user TheUltimator5 points out, the disruption has underlined “how flawed the system is and that 24h overnight trading should NOT exist under the current regulations since there is a big gap.”
Robinhood introduced its “24/5 trading” feature in May 2023, allowing users to trade from Sunday evening to Friday evening. The service primarily focuses on highly liquid stocks and ETFs.
Information for this story was found via the sources and companies mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
