Webull Corporation shares experienced a sharp rally on Wednesday, climbing 11.9% to $6.16 in late-afternoon trading on the Nasdaq. The stock opened at $5.41 and reached an intraday high of $6.24, with volume surging to 15.26 million shares—well above its 12.86 million daily average. The move was not driven by any new earnings release or acquisition speculation but rather by a significant uptick in short-term call options activity.
According to data from The Fly via TipRanks, traders bought 57,626 Webull call options during the session, roughly three times the normal volume. Implied volatility on the stock rose more than four points to 66.97%, reflecting heightened expectations for further price swings. The bulk of the activity was concentrated in weekly June 12 contracts with strike prices of $6 and $6.50. Call options profit when the underlying stock rises, and dealers often hedge by purchasing shares, which can amplify upward momentum. However, if the stock fails to breach key strike levels, the same trades can unwind rapidly, leading to a sharp reversal.
FINRA Rule Change Fuels Optimism
The options flurry comes less than a week after a new Financial Industry Regulatory Authority (FINRA) rule took effect on June 4, eliminating the so-called pattern day trader restrictions. The previous rule required traders with margin accounts under $25,000 to limit themselves to three day trades within a five-business-day window. The updated intraday margin rules remove both the equity minimum and the trade-count limit for small accounts, allowing more frequent trading. FINRA has granted some brokers until October 20, 2027, to fully phase in the changes.
Webull has actively promoted the rule change, with its customer page now stating: “No more $25k minimum” and “No more day trade limits.” In April, Anthony Denier, Webull’s group president and U.S. CEO, described the update as “a meaningful evolution in how active traders can participate in the markets.” The shift is seen as a potential catalyst for retail brokers like Webull, Robinhood, and Interactive Brokers, as it removes a long-standing barrier to frequent trading in small accounts.
Financial Performance and Costs
Webull’s first-quarter results showed strong growth but also rising costs. Customer assets surged 90% year-over-year to $24 billion, while registered users increased 15% to 27.6 million and funded accounts reached 5.1 million. Equity notional volume jumped 104% to $261 billion, and option-contract volume rose 31% to 159 million. Daily average revenue trades (DARTs) climbed 42% to 1.3 million.
Revenue for the quarter came in at $159.9 million, up 36% from a year earlier. However, total operating expenses rose even faster—68%—driven by higher marketing, brokerage and transaction costs, product expansion, and share-based compensation. The company reported a net loss of $21.7 million for the quarter, compared to net income in the prior-year period. Adjusted net income was $9.2 million.
Insider Activity and Buyback Plan
A recent SEC filing showed that director Walter A. Bishop received 12,500 Class A ordinary shares through restricted share units on June 9, along with 29,584 additional RSUs that vest on June 8, 2027. Settlement is deferred until his departure from the company. The filing did not involve any open-market purchase. Separately, Webull has authorized up to $100 million in share buybacks, which may be executed on the open market or through other approved methods, though the company is not obligated to purchase any specific number of shares and may modify or suspend the program at any time.
Risks and Outlook
Webull’s rally is heavily driven by options activity, but the company’s fundamentals remain a concern. In its risk disclosures, Webull warns that trading volumes are volatile and that its revenue is heavily dependent on trading-related income, including payment for order flow. Other risks include competition, regulatory scrutiny, global expansion, cybersecurity threats, and potential dilution from securities activity.
The key question for investors is whether the FINRA rule change will lead to sustained increases in customer activity and transaction revenue, and whether that will be enough to offset rising operational costs. Webull’s next quarterly report will provide a clearer picture of whether the new trading rules are translating into improved operating leverage.
