This article was first published on Statista. And while it’s yet unclear how the story will play out in the long term, it is almost certain to serve as a cautionary tale for years to come as it exposed the holes in a financial system usually dominated by big Wall Street firms. After a public outcry, several brokers, most prominently Robinhood, reversed their decision after market close on Thursday, announcing that they’ll allow limited trade of the targeted companies on Friday. On Thursday, after calls for help from Wall Street had grown louder, several online brokers used by retail investors blocked the trade of the affected stocks, allowing users only to sell their shares, which subsequently tumbled. By Wednesday, January 27, the stock had gained more than 700% over the course of four trading days, while the savvy Redditors started targeting other heavily-shorted stocks. Word spread quickly and GameStop’s share price exploded over the next few days, as individual investors drove up the price enough for mighty hedge funds to abandon their positions and lose billions of dollars. GameStop’s stock rallied, forcing short-sellers, who had bet against the retailer, to cover their positions and buy more GameStop shares.Ī few days later, after things had calmed down a bit, users on the Reddit board r/wallstreetbets noted that GameStop stock was still heavily-shorted and decided to buy up shares of the company to further drive up the price and force the hand of short-sellers. Reddit is a social network with something for everyone: trending topics, diverse discussions, and engaging. For beginner advice, brokerage info, book recommendations, even advanced topics and more, please read our Wiki here. Welcome to Reddit, the heart of the internet. Cohen, GameStop’s second-largest shareholder, had long been pushing for a transformation of the struggling brick-and-mortar retailer, which is why his addition to the board fueled hopes of better times to come. Welcome to r/stocks For stock recommendations please see our portfolio sticky, sort by hot, it's the first sticky, or see past portfolio stickies here. Earlier this month, activist investor Ryan Cohen, founder of, joined the board of video game retailer GameStop along with two former Chewy colleagues. In what could have been a relatively quiet post-inauguration week, a breathtaking story of David vs Goliath played out on the world stage, turning financial markets upside down and wreaking havoc on Wall Street.īut let’s start from the beginning.
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