The shares of the video game retailer GameStop nearly doubled on Monday when the day trader linked to the meme stock mania in January 2021 appeared on X, the first time in 3 years.
Keith Gill (also known as Roaring Kitty and DeepF***ingValue) posted a drawing showing a man in a chair leaning backwards. This meme is often used to indicate volatile times and the possibility of making money or losing it.
It was enough for the post to trigger a surge of buying in GameStop, even though it did not contain any text. Social media was ablaze with memes and messages celebrating the revival in the GameStop stock price.
One person said, “It feels exactly like it’s 2021 again.” “We’re here, baby,” said a second. “The Kitty roared once again,” said another.
Home traders united by slogans such as “Apes together Strong” and “Diamond Hands” placed buy orders which sent shares skyrocketing 21-fold. The same thing happened to other shares that were previously not loved.
Hedge funds suffered heavy losses in 2021 after hedge funds bought shares of GameStop from home traders, whose orders sent them up 21-fold.
The episode was characterized as an ordinary American sticking it to Wall Street, but the majority of securities targeted fell back down to earth soon. Early traders made money. Some traders lost money. The Securities and Exchange Commission did not find any evidence of market manipulation in its report of October 2021. dumb money was a Hollywood film that chronicled this saga.
On Monday, other shares that were part of the excitement from three years ago rose as well. AMC Entertainment, a cinema company, soared up to 37 percent and Koss Corp, a headphone manufacturer jumped 30 percent. Hertz Global Holdings, the car rental group, rose by 12 per cent.
Keith Gill is a GameStop shareholder who is also known as Roaring Kitty in social media forums.
The excitement spread to Reddit – the social media platform most closely linked with meme-stock trader – and Robinhood Markets – the trading platform preferred by Gen Z – whose shares rose by 12 and 9 percent respectively.
Art Hogan said that Roaring Kitty was “the most likely suspect” for the renewed interest. However, he cautioned against referring to the participants as investors. “There is no fundamental difference in the companies that have become popularised by this phenomenon.”
In testimony at a hearing on the meme stock craze in 2021, Gill described himself as a casual trader. He said that he didn’t set out to stoke up the frenzy, but rather believed the stock offered an opportunity to investors.
Gill wrote in a written statement that the idea I used social media as a way to promote GameStop stocks to unaware investors was absurd. “It was clear to me that I was using my channel for educational purposes only. Whether or not other investors purchased the stock was irrelevant to this thesis.”
Last time, the price of GameStop rocketed because hedge funds were trapped in a “short squeeze”, forced to buy at any price so they could close their positions and honor contracts. The short positions at GameStop, which appeared to be a repetition of this mistake, were equal to 24 percent of the publicly traded shares. According to CNBC, an expert from the data group SP3 Partners said that short sellers were now facing losses of $1.02bn on paper.
GameStop’s shares rose 71.25 percent during afternoon trading, valuing it at $9.5 billion.
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