Reddit short squeeze1/31/2024 There is also a renewed focus on the issue of more trading regulations, with the SEC to investigate certain platforms that have blocked the purchase of these stocks. The concern many have is that this spectacle will kick off market gamification, with many people trying to play with their money when they could very well lose it. The current Reddit situation paints the picture of a morality tale, with the common people taking a stand against a system that tends to shut them out. There has been a discussion over financial inclusion for quite some time the stock market has been the stomping grounds for a privileged few until now. This battle of Wall Street is bringing up a great deal of questions regarding the future of financial markets. The Reddit community has been bidding up prices, causing the hedge funds to lose money. As seen in last month, names touted on Reddit’s r/WallStreetBets as names ripe for a squeeze. This is known as a “short squeeze”, and this is what has happened with this small group of stocks. Since the end of the late May/early June meme stock wave, short squeeze stocks remain out of favor. Artificial Intelligence ( A) innovator C3.ai ( AI) may be the market’s next big short squeeze. ![]() The risk in this is that there may be a limited amount of stock to borrow prices may go up when you try to get it back. Short interest in C3.ai is high and r/WallStreetBets has taken notice. To short sell is to borrow a stock then sell it if the price of the stock falls, you can buy it back at a lower price and return it to the lender. Several managers of hedge funds got wind of these comments, and decided it would be profitable for them to short sell GME stocks. It all started when the Reddit community WallStreetBets commented about how investing in Gamestop (GME) would help turn the company’s declining fortunes around. It turns out the source of this unexpected boom was a community on the social website Reddit, and the result is a “short squeeze” that could change how we approach stock market trading. If the first eight months of this ordeal have taught us anything, it is that there might not be an end to this battle in the immediate future.Last week, the world of stock market trading was abuzz with the rise of Gamestop, AMC, and other companies that many considered to be icons of the past. ![]() Gensler made it a point to avoid commenting on any specific scenario or company, but his words do seem to indicate his friendly position towards investors who remain bullish on Gamestop in their plight against the hedge funds with short positions. That’s, that’s sort of, that’s not only free speech but it’s part of what makes our capital markets robust that people can disagree and disagree using the medium of the day.” But I think that people come into your, your show and they advocate either to buy or sell a security before we had television, people did it on radio and now we have various social media platforms. Gensler explained, “I’m not going to speak to one specific company or issuer and so forth. While the conversation about the Gamestop ordeal was only a short portion of Cramer’s overall interview with Gensler, the SEC Chair made a point to stick up for the collection of retail investors that have spent months in a battle with hedge funds that placed bets against the future value of the video game retailer.Ĭramer grilled Gensler about what limits should be set against individual retail investors working as a group via social media. When asked by Cramer if packs of investors on social media should be allowed to target specific positions, particularly funds in extreme short positions, Gensler chose to defend the retail investor. CNBC’s Jim Cramer has been beating the drum against retail investors in the battle of Gamestop and was joined for an interview by SEC Chairman Gary Gensler, the nation’s top dog in regards to financial rule enforcement. ![]() Those who’d taken the negative position then have to buy back the stock at a higher price to prevent further losses. Much like at the start of the ordeal, traditional finance media outlets continue to ruffle their own feathers about the outlandishness of a social media community working together against established funds. Short squeeze definition A short squeeze happens when a stock sees a rapid increase in price even though investors had previously bet on its decline. ![]() In what has become the finance sector’s drama that won’t die, the Gamestop (GME) stock saga has endured into its ninth month.
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