A Signature Bank branch. Retail traders are on the outside looking in as they try to cash in on bets against the bank. (Photo by Andrew Lichtenstein/Corbis via Getty Images)
Retail options traders who thought they hit the jackpot with their wagers against the stock of Silicon Valley Bank and Signature Bank are now finding themselves in a world of hurt. Despite the collapse of the banks, the traders are unable to cash in on their put options after brokers halted trading in the stocks, leaving them with worthless contracts set to expire Friday.
Forbes first reported on Robinhood and Fidelity being among the brokers causing headaches for traders, but now it turns out that Charles Schwab, TD Ameritrade, Webull, E-Trade and Interactive Brokers are all making it difficult for traders to take their profits. Brokers are insisting that unless traders own the shares to satisfy the put contracts they’re basically out of luck unless the stocks start trading again before the options expire.
This has left a legion of retail traders to vent their outrage on Twitter. They’ve created SBNYPuts.com to track the responses they’ve received from brokers.