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Drawing the attention of financial regulators, lawmakers and the White House to possible market manipulation, GameStop’s stock fell 81% just days after hitting an all-time high of $ 483. As the momentum boosted by traders on r / WallStreetBets slows down, the company’s stock now sits below $ 100.
The sharp drop reveals that the major hedge funds that suffered squeezing closed their short positions after the Reddit rally, and many investors who tried to make money from the recent surge suffered large losses. Other stocks that have seen highs recently have also fallen, with AMC Entertainment dropping from $ 20 per share to just $ 6.50 and Blackberry following to $ 11 from $ 28.
Mike Mullaney, director of global markets research at Boston Partners, said: “It was inevitable – it comes down to the age-old premise that the stock market, ultimately, at the margin, is driven by greed and greed. scared … I feel bad for anyone who jumped on this trade last week, especially on the buying side.
In case you missed it, the price of silver will climb to an eight-year high, but r / WallStreetBets says it’s not behind the rally.
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