Tthe Robinhood logo is displayed on a smartphone screen.
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LONDON — Robinhood said Monday that it’s rolling out margin investing — the ability for investors to borrow cash to augment their trades — in the U.K.
The U.S. online investment platform said that the option would allow users in the U.K. to leverage their existing asset holdings as collateral to purchase additional securities.
The launch of margin trading follows the recent approval of the product, after Robinhood held conversations with Britain’s financial regulator, the Financial Conduct Authority (FCA).
Margin trading is a rarity in the U.K., where regulators see it as more controversial because of the risks involved to users. Some platforms in the country limit margin trading for only high-net-worth individuals or businesses. Other firms that offer margin investing in the U.K. include Interactive Brokers, IG and CMC Markets.
The stock trading app touted “competitive” interest rates with its margin loans offering. Rates offered by the platform range from 6.25% for margin loans of up to $50,000 to 5.2% for loans of $50 million and above.
Jordan Sinclair, president of Robinhood U.K., said that many customers feel they can’t access more advanced products like margin trading in Britain, as they’re typically reserved for a select few professional traders investing with the likes of heavyweight banks JPMorgan Chase, Goldman Sachs, Morgan Stanley and UBS.
“There’s so many barriers to entry,” Sinclair told CNBC in an interview. “Ultimately, that’s what we want to break down all those stigmas and barriers to just basic investing tools.”
He added, “For the right customer this is a great way to diversify and expand their portfolio.”
A risky business
Investing on borrowed cash can be a risky trading strategy. In the case of margin trading, investors can use borrowed money to increase the size of their trades.
Say you wanted to make a $10,000 investment in Tesla. Usually, you’d have to fork out $10,000 of your own cash to buy that stock. But by using a margin account, you can “leverage” your trade. With 10x leverage, you’d only need to have $1,000 upfront to make the trade, instead of $10,000.
That can be a lucrative strategy for professional traders, who can make even larger returns than on usual trades, if the value of the purchased asset rises significantly.
It’s a riskier path for retail traders. If the value of the asset you’re buying on borrowed cash drops significantly, your losses will be dramatic, too.
Robinhood announced it was launching in the U.K last November, opening up its app to Brits in March. At the time of launch, Robinhood was unable to offer U.K. users the option of margin trading, pending discussions with the FCA.
“I think with the regulator, it was just about getting them comfortable with our approach, giving them a history of our product in the U.S., what we’ve developed, and the eligibility,” Robinhood’s Sinclair told CNBC.
Sinclair said that Robinhood implemented robust guardrails to ensure that customers don’t invest more cash than they can afford to lose when margin investing.
The platform requires users seeking to trade on margin to have a minimum of $2,000 of cash deposited in their accounts. Customers also have to opt in to use the product — they’re not just automatically enrolled for a margin account.
“There are eligibility criteria. There is a way to review appropriateness of this product for the right customer,” Sinclair added. “Fundamentally, that’s a really important part of this product. We recognize it isn’t for the novice investor that’s just getting started on our customer.”
Robinhood says that its customers’ uninvested cash is protected to the tune of $2.5 million with the U.S.’ Federal Deposit Insurance Corporation, which the firm says adds another layer of protection for users.
The Exchange Square Complex, which houses the Hong Kong Stock Exchange, on Feb. 26, 2025.
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BEIJING — Chinese companies are jumping at a window of opportunity to go public in Hong Kong as global investors start to return to the region, following the news of DeepSeek’s artificial intelligence breakthrough in late January.
It’s a level of excitement that has not been felt for more than three years, despite the overhang of U.S. trade tensions. Initial public offerings are a lucrative way for early investors in startups to exit and reap a return.
“Everyone is working so perfectly together. IPO candidates, the investor and the regulators,” said George Chan, global IPO leader at EY. “All these three parties are working so perfectly at this moment to actually cultivate a healthy Hong Kong IPO market.”
“The U.S. long-term fund has returned. It shows investors are getting more confident [about] China,” he said, adding that post-IPO performance has also been encouraging.
News of China-based DeepSeek’s claims to rival OpenAI’s ChatGPT in reasoning capabilities at a lower cost — despite U.S. restrictions on Chinese access to advanced chips for training AI models — hit global tech stocks in late January, while spurring a rally in China. Hong Kong’s Hang Seng index surged to three-year highs.
Six initial public offerings in Hong Kong raised more than 1 billion Hong Kong dollars ($130 million) in the first quarter — a jump from just one listing of that size in the year-ago period — according to KPMG.
In all, the consultancy said, Hong Kong saw 15 IPOs in all of the first quarter which raised 17.7 billion HKD — the best start to a year since 2021.
There’s still a long way to go before recovering to that level. Hong Kong saw 32 IPOs in the first quarter of 2021 that raised a whopping 132.7 billion HKD, according to KPMG.
The Hong Kong stock exchange has adjusted its listing rules in the interim, including ones that support companies already listed in mainland China to offer shares in Hong Kong.
In addition to CATL, other companies listed in mainland China — Hengrui Pharmaceuticals, Mabwell, Haitian Flavoring and Food, Fortior Tech and Sanhua Intelligent Controls — are “actively seeking Hong Kong listings,” said Tiger Brokers, an underwriter of many Chinese companies’ IPOs in the U.S. and Hong Kong.
“Chinese regulators are encouraging companies to list in Hong Kong to broaden financing channels and support the outbound merger and acquisition needs of Chinese enterprises,” the firm said.
Still not out of the woods
Back in the summer of 2021, the fallout over Chinese ride-hailing company Didi’s IPO in the U.S. prompted both countries’ regulators to scrutinize what was then a wave of Chinese companies listing in New York.
The major issues have since been resolved and Beijing has clarified rules for Chinese companies wanting to list outside the mainland. But the Trump administration indicated in its “America First Investment Policy” that it could increase scrutiny on U.S. capital flowing to China, on top of heightened tariffs.
The U.S. and China have yet to indicate when their two leaders might meet in an attempt to forge a deal. A surge of interest in AI and tech are also not yet enough to speed up a recovery in China’s economy.
“At this point in time, all we can see is the good indicators,” EY’s Chan said. But “there could be one single incident happening which could pretty much reverse the trend.”
“Things tend to have a pattern,” he said. “If things can keep on for three months, four months, it will likely continue for the rest of the year.”
Treasury Secretary Scott Bessent speaks to reporters outside the West Wing after doing a television interview on the North Lawn of the White House on March 13, 2025 in Washington, DC.
Andrew Harnik | Getty Images
Treasury Secretary Scott Bessent said Wednesday the sell-off in the stock market is due more to a sharp pullback in the biggest technology stocks instead of the protectionist policies coming from the Trump administration.
“I’m trying to be Secretary of Treasury, not a market commentator. What I would point out is that especially the Nasdaq peaked on DeepSeek day so that’s a Mag 7 problem, not a MAGA problem,” Bessent said on Bloomberg TV Wednesday evening.
Bessent was referring to Chinese AI startup DeepSeek, whose new language models sparked a rout in U.S. technology stocks in late January. The emergence of DeepSeek’s highly competitive and potentially much cheaper models stoked doubts about the billions that the big U.S. tech companies are spending on AI.
The so-called Magnificent 7 stocks — Apple, Amazon, Tesla, Alphabet, Microsoft, Meta and Nvidia — started selling off drastically, pulling the tech-heavy Nasdaq Composite into correction territory. The tech-heavy benchmark is down about 13% from its record high reached on December 16.
However, the secretary downplayed the impact from President Donald Trump’s steep tariffs, which caught many investors off guard and fueled fears of a re-acceleration in inflation, slower economic growth and even a recession. Many investors have blamed the tariff rollout for driving the S&P 500 briefly into correction territory from its record reached in late February. Wall Street defines a correction as a drop of 10% from a recent high.
S&P 500, YTD
Trump signed an aggressive “reciprocal tariff” policy at the White House Wednesday evening, slapping duties of at least 10% and even higher for some countries. The actions sparked a huge sell-off in the stock market overnight, with the S&P 500 futures declining nearly 4% and the blue-chip Dow Jones Industrial Average shedding 1,100 points. The losses will likely but the S&P 500 back into correction territory in Thursday’s session.
“It’s going to be fine if we put the best economic conditions in place,” Bessent said in a separate interview on Fox Wednesday evening. “If you go back and look, the stock market actually peaked on the [DeepSeek] Chinese AI announcement. So a lot of what we have seen has been just an idiosyncratic tech sell-off.”
A Newsmax booth broadcasts as attendees try out the guns on display at the National Rifle Association (NRA) annual convention in Houston, Texas, U.S. May 29, 2022.
Callaghan O’hare | Reuters
Shares of conservative news channel Newsmax plunged more than 70% on Wednesday as its meteoric rise as a new public company proved to be short-lived.
The stock tumbled a whopping 72% in afternoon trading, following a 2,230% surge in Newsmax’s first two days of trading after debuting on the New York Stock Exchange. At one point, the rally gave the company a market capitalization of nearly $30 billion — surpassing the market cap of legacy media companies like Warner Bros. Discovery and Fox Corp.
Newsmax was listed on the NYSE via a so-called Regulation A offering, instead of a traditional IPO. Such an offering allows small companies to raise capital without undergoing the full SEC registration process. The primary focus is to sell to retail investors, in this case It was sold to approximately 30,000 retail investors.
The public offering indeed garnered the attention from retail traders, some of whom touted the stock as the “New GME” in online chatrooms. GME refers to the meme stock GameStop, which made Wall Street history in 2021 by its speculative trading boom.
Newsmax has a small “float,” or shares available for trading. Less than 6% of Newsmax shares, or 7.5 million shares out of a total of 128 million fully diluted shares, are available for public trading.
The conservative TV news outlet has seen its ratings rise with the election of President Donald Trump and other prominent Republicans — although it still falls behind the dominant Fox News. Overall, Newsmax ranks in the top 20 among cable network average viewership in both prime time and daytime, Nielsen said.