In the past few days, the U.S. stock market on the other side has staged a legendary story of “cutting vegetables and cutting sickles”.
The boom of Game Post (NYSE:GME) continued with shorts being hit hard as young and enthusiastic American retail investors bought heavily.
As of Wednesday’s closing, Game Station rose 133.13% to the latest share price of $344.99.
On January 12, its closing price was only $19.95, up 1630% in just 10 trading days!
In addition to the game post station, crazy retail investors also focused on a number of seriously shorted stocks.
Wang Jianlin’s AMC theaters closed up more than 300%, up 568% in four trading days; BlackBerry soared 31.71%, up more than 50% in intraday trading, and a cumulative increase of 278% this year; Nokia closed. The increase is 40.17%.
This also attracted the attention of the White House. Psaki, a White House press spokesman, said that U.S. Treasury Secretary Yellen and Biden’s economic team are closely monitoring the activities of GameStop and other companies whose stocks have been heavily shorted.
“Demon Stock” game post station soared 16 times in 10 trading days
Recently, the U.S. market staged a crazy “group” of retail investors to fight against the “short war” of institutions.
It all starts with GameStop, a game retailer. Gamestop (Game Post Station) (GME for short).
Many people in the United States grew up shopping for game disks at game stations. Before Christmas, parents lined up and carried games home, which was full of memories and atmosphere.
However, in the current situation of technological development, fewer and fewer people will go to physical stores to buy physical games.
In the past few years, most people have not been optimistic about game stations. Share prices fell all the way from 28 in 2016 to more than 3 yuan at the end of 2019.
Last year, Game Post became the stock that shorted the most in the United States. According to FactSet data, the net short of game station is 138% of stock circulation.
And just as the game station was forced to go bankrupt and faced with delisting, the netizens of the American forum reddit saw these short institutions that held strong positions, and some people began to encourage everyone to buy the shares and options of the game stations.
WallStreetBets, a reddit division, is similar to China’s stock bar, abbreviated as WSB.
Many of the stocks that have been seriously shorted in the recent surge have been seen, so they are also known as “WSB concept stocks”.
On Tuesday, local time, Musk, the richest man in the world, posted a tweet shouting “Gamestonk!” with a link to the WallStreetBets section.
Shares of the company closed up 92.71% at $147.98 on Tuesday.
Wednesday closed again up 133.13%, with the latest share price of $344.99. On January 12, it closed at only $19.95, up more than 16 times in just 10 trading days.
As of Tuesday, the short losses at GamePost exceeded $5 billion (about 32.3 billion yuan), including $917 million and $1.6 million on Monday and Friday, respectively, according to S3 Partners.
Since the low point in March last year, the game station has soared 108 times.
Gabe Plotkin, fund manager of Melvin Capital, a 10 billion hedge fund, told CNBC on Wednesday that the company had cleared its short position in the game station on Tuesday afternoon after experiencing a huge loss.
Plotkin also clarified rumors that Melvin Capital was about to be liquidated, saying that speculation that the company would file for bankruptcy was wrong. The specific loss amount of Melvin Capital’s short-selling behavior in response to the game station is not yet known.
At present, the U.S. government has paid attention to the game station with abnormal stock price trends.
Psaki, a White House press spokesman, said that U.S. Treasury Secretary Yellen and Biden’s economic team are closely monitoring the activities of GameStop and other companies whose stocks have been heavily shorted.
Psaki said that the unusual trading of game stations “is a good reminder that the stock market is not the only measure of our economic health.”
According to the Financial Union, Massachusetts Secretary of State William Galvin said: “I am very worried because the current situation shows that there are systemic problems in the trading of options for this stock.”
Calvin has been active in regulating securities trading activities.
At the end of 2020, he sued Robinhood, the most popular trading platform for retail investors in the United States, alleging that the company encouraged investors to make high-risk bets.
Amy Lynch, a former regulator of the Securities and Exchange Commission (SEC), also said that regulators, including the SEC, will monitor transactions and look for signs of market manipulation.
They sometimes pay attention to what people say about stocks in public forums. “I’m pretty sure the market regulator is already paying attention to this issue,” she said.
Regarding the recent abnormal fluctuations in the stock price of Game Station, Adena Friedman, CEO of Nasdaq Exchange, said in an interview with CNBC on Wednesday local time that we will monitor the comments on social media and suspend stock transactions if it is found to be related to the abnormal performance of stocks. Easy.
What other stocks are American retail investors focusing on?
The popularity of the game post station is “high fever”, and at the same time, other stocks that have been shorted have also risen.
Film and television theater stock AMC rose by more than 310% in intraday trading, which once triggered a trading meltdown and closed up more than 300.81%, and the stock price reached its highest since October 2018. The company said that it had completed the plan to issue 63.3 million additional common shares “at current market prices” and raised $305 million.
According to the analysis, in addition to short-selling institutions, AMC can avoid bankruptcy and stimulate the enthusiasm of U.S. retail investors.
Fashion clothing retailer Express rose nearly 360% in intraday trading, triggering a meltdown and closed up more than 215%, a new high in more than two years. This year, it rose more than 14 times. The stock also participated in the epic shorting of retail duel institutions.
This drove the collective rise of textile and clothing and luxury goods stocks in the United States. Naked Brand Group soared by 252%, Fossil rose 126% at one time, and Canadian goose rose by more than 8% at one time.
U.S. communication equipment stocks rose together.
Nokia closed up more than 40%, up 86% in intraday trading and suspended trading several times; BlackBerry rose 52%, closing up 31%, the highest since September 2011, more than tripled in less than a month; Ericsson rose more than 27% and suspended trading for a time.
No one can accurately predict when the short market will subside, but market participants have warned about this batch of stocks.
Michael Burry, an investor in the game station and the prototype of Big Short, said that the recent rise of the stock was “irregular, crazy and dangerous”.
It is worth mentioning that Barry’s own Sain Asset Management Company held 1.7 million shares of Game Station as of the end of September last year, and the value of these shares will soar to $586 million from about $17 million at that time as of Wednesday’s closing!
The United States has produced several “tenfold shares” so far this year.
Game Station has increased by 1731% this year, AMC theaters have increased 838% this year, Express has increased 952%, and Naked Brand Group has increased 619%. Gaussian Electronics rose 1586%.