The GameStop logo was arranged on a laptop computer on the WallStreetBets forum on the Reddit Inc. website and on a smartphone on Friday, January 29, 2021 in Hastings-on-Hudson, New York, US.
Tiffany Hagler-Gear | Bloomberg Getty Images
Gametop shares had volatility in pre-market trading since Monday as reddit-fuel fractional trading continues.
Shares of the bricks-and-mortar video game retailer jumped 18% to $ 384.89 in prime trading. Shares were up nearly 2% to $ 333. The stock rose 1,625% in January.
According to data from S3 Partners, the astronomical rally has led to a mark-to-market loss of about $ 20 billion to hedge funds with lower positions than the stock. However, many short-sellers are in a slump.
Robinhood and other trading apps limit the purchase of Gametop stocks and option contracts, along with other heavy-handed names, after a week of extremely volatile trading due to a retail trading frenzy led by the 5 million-strong Reddread Thread “WallStreetBets”. “
The limits also apply to AMC Entertainment, Blackberry, Kos, Express, Nokia, Genius Brands International and Naked Brand Group.
Short selling is a strategy in which investors borrow shares of a stock at a fixed price in the hope that the market price will fall below the level when it is time to pay for the borrowed shares.
– Yun Li of CNBC contributed to this report.