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(Bloomberg) -- A bevy of retail trading platforms have warned users that they could face disruptions on Tuesday as the US election roils markets.
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eToro warned extreme conditions could trigger circuit breakers. Trading 212 — one of the biggest day trading apps in Europe — cautioned users that some trading venues may impose temporary trading suspensions to stabilize markets. Freetrade, a London-based trading platform, is also planning to send users warnings about the expected volatility.
With polls not closing in some states until well into the New York night, it’s likely that the volatility will bleed into overnight sessions and last through the trading day on Wednesday, some firms warned. That comes as markets brace for another surprise, with the Federal Reserve and the Bank of England both poised to make rate announcements on Thursday.
“Investors should be prepared to expect sharp market movements up and down and difficulties executing trades,” said Alexander Campbell, a spokesman for Freetrade. “For retail investors feeling caught up in a whirlwind of geopolitical and economic noise, it’s essential that they stick to their investment strategy.”
Still, such warnings are often standard cautionary notes that brokerages send at times of expected volatility, according to two people who work at trading firms. Those market-making firms aren’t seeing significant trading disruptions currently, they said, asking not to be identified discussing the information publicly.
Charles Schwab Corp. and Interactive Brokers Group Inc. both said they had not sent out any warning messages.
“We don’t expect to have any issues at this point in time,” a spokesperson for Greenwich, Connecticut-based Interactive Brokers said. “We’ve seen heavy trading volumes on the exchange with over 50 million presidential contracts traded today.”
The rise of commission-free trading apps has given way to a whole new class of day traders that have become an important force in markets around the world. For instance, retail investors make up more than a quarter of the volume in the booming world of zero-day stock options.
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