Brokerage Firm Siebert Soars as Reddit Feed Targets Another Short Squeeze

Brokerage firm Siebert Financial's stock quintuples after amateur investors who are part of a Reddit message board target another short squeeze.
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Shares of Siebert Financial  (SIEB) - Get Report spiked Friday after the brokerage firm became the latest stock to attract the attention of ordinary investors prompted by a Reddit message board called WallStreetBets.

Shares of Siebert at last check traded at $9.92, more than 2 1/2 times Thursday's close at $3.71. At the high of Friday's trading, the stock had quintupled to $18.50. 

Siebert, which does retail brokerage business through its Muriel Siebert subsidiary, said that it has not released any news on Friday, Dow Jones reported.

The frenzied trading that started on Jan. 25 has catapulted valuations of companies like videogame retailer GameStop  (GME) - Get Report, theater chain AMC Entertainment  (AMC) - Get Report and security-solutions provider Blackberry  (BB) - Get Report, among others.

WallStreetBets has been trying to collectively push shares of these companies higher in a bid to force hedge funds and other large investors to abandon their short positions -- bets that stock prices will decline -- in those companies. 

Siebert's most recent news release came on Nov. 16, when the company hired Anthony Palmeri from JPMorgan Chase  (JPM) - Get Report and Jerry Losurdo from TD Prime Services to lead Siebert’s securities-finance group.

On the same day last year, Siebert also filed its earnings for the quarter ended Sept. 30 to the Securities and Exchange Commission.

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GameStop and other heavily shorted names have soared after the chief executive of online brokerage Robinhood said restrictions on buying the stocks could be lifted Friday.

The Securities and Exchange Commission said it was 'closely monitoring and evaluating the extreme price volatility of certain stocks’ trading prices over the past several days. 

"Our core market infrastructure has proven resilient under the weight of this week’s extraordinary trading volumes. Nevertheless, extreme stock price volatility has the potential to expose investors to rapid and severe losses and undermine market confidence."

Sen. Sherrod Brown (D-Ohio), the incoming chairman of the Senate Banking Committee, said on Thursday that the panel would be looking into the situation.

“People on Wall Street only care about the rules when they’re the ones getting hurt. American workers have known for years the Wall Street system is broken – they’ve been paying the price,” Brown said in a statement quoted by the news service.

“It’s time for the SEC and Congress to make the economy work for everyone not just Wall Street. That’s why, as incoming Chair of the Senate Banking and Housing Committee, I plan to hold a hearing to do that important work.” 

House Speaker Nancy Pelosi (D-California) on Thursday also said that Congress would look at what's happening with GameStop and many other companies that had been targeted by short sellers, or investors who bet that stocks will decline.