“We are the new home for everyone who wants to take their money into their own hands.” This is how the neobroker Trade Republic advertises its business model on its website.
State-of-the-art technologies for convenient mobile trading, inexpensive transactions and a hip start-up image - this is how the young company rolled out the market since it was founded in autumn 2015.
The timing was good: there was a widespread understanding that there is no way around stocks for adequate private retirement provision, large stock indices benefited from the run of a few technology high flyers and gave buyers of the corresponding ETFs considerable success.
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“Everything on shares” is the daily stock market shot from the WELT business editorial team. Every morning from 7 a.m. with the financial journalists Moritz Seyffarth and Holger Zschäpitz. For stock market experts and beginners. Subscribe to the podcast on Spotify, Apple Podcast, Amazon Music and Deezer. Or directly via RSS feed.
“Everything on shares” is the daily stock market shot from the WELT business editorial team.
Every morning from 7 a.m. with the financial journalists Moritz Seyffarth and Holger Zschäpitz.
For stock market experts and beginners.
Subscribe to the podcast on Spotify, Apple Podcast, Amazon Music and Deezer.
Or directly via RSS feed.
But now the success story has gotten rid of a flaw, and Trade Republic is - rightly - facing the charge of arbitrariness.
The broker's undoing was the hype surrounding the US company Gamestop, a seller of PC games and other electronics that is fighting the trend that gamers are now more likely to order their games on the Internet or play them directly there.
Accordingly, the company was considered a bankruptcy candidate among stock exchange traders, and its share price was recently correspondingly low.
But then a bizarre hype set in around the paper, its price rose from the equivalent of 14 euros on January 4th to 323 euros on Friday morning - an increase of more than 2000 percent.
In Germany, too, many investors jumped on the hype, and because it is so easy, many of the traders used Trade Republic for their transactions.
On Thursday, however, the company turned to its customers with an astonishing message: “No further acceptance of buy orders for certain stocks” was the message in an email in which customers were verbally asked to understand that they are no longer free to choose are allowed to choose which stocks to buy.
In addition to Gamestop, other values that had come into the focus of gamers were also affected.
"Customers who have purchased the above stocks should be advised that the price of these stocks can change or fall rapidly," continues Trade Republic.
"We want to protect our customers"
The anger of the investors, who had previously been prevented from trading due to technical problems, was great.
They wrote their frustration off their hearts on all portals, the average rating of the company on the Trustpilot portal fell overnight from 4.4 out of 5 possible stars to 2.8.
On Thursday evening, the board tried to limit the damage: “We want to protect our customers”, assured co-founder Christian Hecker to Spiegel Online.
Even if the trade restrictions were lifted again on Friday: The reason given by the board of directors for interfering with customers' trading behavior raises questions.
The restriction does not suit a company that is committed to the democratization of investment.
Anyone who goes to Trade Republic instead of doing their securities business at the local savings bank should also be trusted with the Berlin company that they know what they are doing.
He chose a neo broker and not a nanny broker.
The statement by the board of directors becomes even more questionable, however, when one realizes that Trade Republic was - and is - able to trade multiple leveraged warrants and knockout certificates on all possible underlyings at any time without further ado and without interruption.
Many small investors will burn their fingers while gambling with Gamestop and other stocks, that much already seems clear.
However, taking up the cause of investor protection and banning trading in these stocks on the basis of this, while at the same time offering warrant trading, is anything but convincing argumentation.
The investors concerned deserve an explanation for this.
A run on GameStop shares paralyzes platforms
The run on shares in the video game retailer GameStop is now pushing Internet trading platforms to their limits.
More and more small investors are trying to harm large hedge funds by buying stocks.
They tried to bet on falling prices by buying short.