Reddit people shoot short-selling hedge funds, triple the share price of the world's largest game retail chain in five days
The stock price of
GameStop (GME) Stock Price Surge Defies Analysts as Reddit Gets Last Laugh --Bloomberg
https://www.bloomberg.com/news/articles/2021-01-25/gamestop-melt-up-leaves-wall-street-price-analysis-in-shambles
How Reddit's WallStreetBets Pushed GameStop (GME) Shares to the Moon --Bloomberg
https://www.bloomberg.com/news/articles/2021-01-25/how-wallstreetbets-pushed-gamestop-shares-to-the-moon
How Reddit and WallStreetBets blew up GameStop's stock --Vox
https://www.vox.com/the-goods/22249458/gamestop-stock-wallstreetbets-reddit-citron
Why Has GameStop's Stock Gone Up So High Recently? | Time
https://time.com/5933242/gamestop-stock-gme/
GameStop was the world's largest video game sales chain with more than 5,000 physical stores in the United States and EU, but in recent years sales have declined due to the appearance of online games and game download sales. Furthermore, from the beginning of 2020, the epidemic of COVID-19 accelerated the decline in demand at physical stores, and it was said to be 'bankruptcy countdown' rather than management difficulties.
The turning point for GameStop's stock price came in September 2020. Ryan Cohen, co-founder of pet food retail giant Chewy, has acquired 5.8 million shares of GameStop, and GameStock's share price suddenly jumped 24%. There was no noticeable movement after this surge, but r / Wall Street Bets , a community on stock prices and options trading within Reddit, said that the prediction that 'GameStop's stock price will rise soon ' became predominant.
The next big move in GameStop's stock price was in early January 2021. Around the same time that Cohen was fully appointed CEO of GameStop, Reddit said, 'Hedge funds are short selling GameStop shares, according to publicly available information.' Information has spread. Short selling is the act of 'selling stocks in advance and buying them later', and is mainly executed in anticipation of a decline in stock prices. As a result, many institutional investors at this point saw that 'GameStop's stock price surge was temporary and will definitely fall later.'
The opinion of this institutional investor is represented by the report of Citron Research, which specializes in stock commentary. The company has doubled its share price in just one week since the dawn of 2021. 'I will tell you five reasons why people who buy GameStop shares are not good at it. The stock price will soon return to normal. It will be ', and gave a detailed explanation in the live streaming.
Tomorrow am at 11:30 EST Citron will livestream the 5 reasons GameStop $ GME buyers at these levels are the suckers at this poker game. Stock back to $ 20 fast. We understand short interest better than you and will explain. Thank you to viewers for pos feedback on last live tweet
— Citron Research (@CitronResearch) January 19, 2021
Immediately before this announcement, Citron Research was ridiculing the movement on Reddit, so Reddit users were repulsed. In anticipation of a decline in value, he made a fierce 'buy' in opposition to Citron Research, which recommended 'selling.' Thus, after the announcement of Citron Research, millions of GameStop shares were bought and sold in minutes and trading stopped four times. In response to the soaring turmoil, a ' short squeeze ' occurred in which short- selling investors repurchased loss cuts caused a further rise in stock prices, and the rise in stock prices accelerated like a snowball. In the end, it showed a record surge of 'triple in 5 days'.
GameStop stocks are called ' meme stocks', which refer to stocks that are both economical and have cultural and social implications, and earned $ 300,000 (about 31 million yen) on Reddit through a series of turmoil. Even users who said that they did it appeared. There is a festive ruckus that pleases the tears of hedge funds that were expecting GameStop's stock price to fall.
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