About GameStop and Why American Gaming Company GameStop Shares Gone Wildly?

 

About GameStop and Why American Gaming Company GameStop Shares Gone Wildly?

 

Shares of GameStop, an American gaming company, have gained more than 1900 percent so far this year. With no fundamentals, questions have been raised about the rise in the shares of GameStop. Let us tell you that GameStop is a video game retailer company. Since January 4, its shares have registered a jump of over 1900 per cent. On the online forum Reddit, a group of investors worked together to fight the Wall Street Fund, after which its price was reduced.

For about 6 months, the stock whose price was 3 dollars i.e. about 200 rupees, in just 20 days, it became $ 325, i.e. 23,694 thousand rupees. Since January 4, its shares have registered a jump of over 1900%.

 

This is a rebellion of the American boys against the powerful feudatories of the American stock market. Culture wise in a way. Reddit users said that we want to bring democracy to Wall Street. Reddit users traded a lot in GameStop shares through the Robinhood app and implicated the hedge funds. Now there is unusual activity in the market, then the regulators have awakened. The latest incident is that Robin Hood App has to collect $ 1 billion and deposit it as margin money. Robinhood App's co-founder is an Indian Baiju Bhatt.

 

How the story started!

 

Wallstreet bets is a forum on the social media website Reddit. There are 4 million members on this forum. Their job is to unite against big fund houses and beat them in the stock market. So, it happened that big fund houses like 'Melvin Capital' and 'Citron Research' target such stocks that are overvalued and their price is likely to fall in the future. In such a situation, they take short positions by borrowing a large number of stocks and earn profits by short selling when the price falls further.

 

A similar game was also happening with GameStop's stock. While these big hedge funds were waiting for the stock price to fall by taking short positions, then millions of members of the Reddit Forum started investing in GameStop shares together to teach them a lesson. If the demand increased due to heavy investment in the stock, then its price also started going up and in this way the stock price skyrocketed in the last 15 days.

 

Why GameStop shares rose!

 

Actually, Elon Musk, the founder of electric car maker company Tesla, tweeted a tweet. After this GameStop shares rose. Musk tweeted a word Gamestonk !!, which turned the Trader chat room into GameStop the biggest stock story of the retail era. Stonks is a term for shares widely used on social media. Hardly anyone would have imagined such a jump in the company's stock. Also, investors have benefited greatly from this.

 

 

Market cap crossed $ 22 billion

 

GameStop's market cap has crossed $ 22 billion, due to a sharp rise in stocks. As the value of the company increases, more than 10 percent of the total value of companies like Under Armor and American Airlines Group in S&P 500 has been GameStop alone.

 

Loss to fund house

 

Due to the rise in the stock of GameStop, trading was stopped 7 times on Monday and 5 times on Tuesday. The stock has jumped seven and a half times in 15 days. But in this game of GameStop, the game of big fund house got spoiled. According to Business Insider, so far the short-sellers have lost 19 billion dollars or 1.38 lakh crore rupees. However, American hedge funds 'Melvin Capital' and 'Citron Research' have not disclosed their losses.