Robinhood shares halted after massive spike, looming short squeeze

Robinhood’s surging shares were halted on Wednesday after a massive spike, with some investors speculating that its dizzying rally is being driven by fears of a short squeeze.

Moments after the opening bell on Wednesday, the stock climbed as high as $85 — up a staggering 81 percent from Tuesday’s closing price of $46.80 and briefly giving the company a market capitalization of more than $65 billion. But even as ‘HOOD’ reaches fresh highs, experts say all signs point to Robinhood being one of the most popular targets for short sellers. The stock borrow rate — how much it costs to borrow a stock and short it — is trading at unusually high levels. Typically, the borrow rates to short a stock is 0.5 percent. For Robinhood, the rate is 40 percent to 90 percent.