What happened

GameStop's (NYSE:GME) stock price fell more than 30% on Monday, as Robinhood and other trading platforms limited investors' ability to buy the video game retailer's shares.

So what

Amid volatile trading that drove the prices of GameStop and other heavily shorted stocks up sharply in recent weeks, popular millennial-focused trading platform Robinhood imposed severe restrictions on its users' ability to buy these and other stocks. On Monday, investors were able to buy only 20 shares of GameStop, a total that included any shares they already owned. They could, however, freely sell their shares. 

A downwardly sloping digital stock chart.

As brokerages imposed trading restrictions, GameStop's stock shed 30% of its value. Image source: Getty Images.

Robinhood claimed it was forced to impose buying limits on GameStop and other volatile stocks in order to comply with clearinghouse deposit requirements. Robinhood CEO Vlad Tenev said the brokerage "had to conform to our regulatory capital requirements." 

Now what 

Financial pundits such as Jim Cramer have urged individual investors to take profits in GameStop in recent days. With its stock price still up more than 1,000%  since the beginning of the year, many analysts see GameStop's shares as grossly overvalued. 

"Take the home run," Cramer said on Friday. "You've already won." 

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.