GameStop share price: What’s behind the 8,000% run?
‘If I had never been involved in GameStop and came to this right now, would I still be short this stock? 100 percent.’
Information about GME and AMC
In order to prioritise the service we give our existing clients, IG is not allowing any new positions to be opened on the US stocks GameStop and AMC Entertainment. Clients are still able to close existing positions.
GameStop share price reaches new highs
The GameStop-WallStreetBets-Citron saga continued overnight, with the stock surging 92.61% or $71.15, to finish out Tuesday's session at $147.98 per share.
The hyper-bullish price action didn’t stop there. Traders continued to pile into GameStop (GME) at a rapid click in after-hours trade, sending the stock up another 41%, to $209 per share, at the time of writing.
From the company’s 52-week low of $2.57 per share to that after-hours price, the stock has gained in excess of 8,000% in under a year.
WallStreetBet’s recipe for success
This all comes as traders from the popular but controversial subreddit, WallStreetBets (WSB), have piled into GME over the last month – buying both the underlying stock while simultaneously snapping up call options at a rapid click.
This has seen many from the subreddit post screenshots of dizzying gains, often accompanied with brash language and a nihilistic tone. For example, one recent post boasted that a WSB user had turned a mere $50 thousand bet into over $22 million trading GME.
But it’s not just users from WSB piling into the stock or poking fun at GME’s meteoric run. Controversial billionaire investor, Chamath Palihapitiya on Tuesday revealed he too was taking a punt on GME, tweeting out an image showing that he had bought 50 call options on GME. He did this at the behest of his Twitter followers, saying:
‘Tell me what to buy tomorrow and if you convince me I’ll throw a few 100 k’s at it to start.’
Even Elon Musk – another billionaire who has courted controversy for his tweets in the past – threw his opinion into the ring, tweeting ‘Gamestonk!!’ and providing a link to the WSB subreddit.
Shorts remain short
Despite the feverish atmosphere that continues to build around GME, some, such as the well-known short-seller Andrew Left, remain bearish on the stock.
Left’s Citron Research last week tweeted that ‘GameStop buyers at these levels are the suckers at this poker game’ while adding that ‘$GME going to $20 buy at your own risk.’
After being derided and threatened for this view, Left said he would no longer comment on GME.
He seems to have revised this commitment to a media blackout somewhat, telling Reuters on Tuesday that he was still short GME (despite the colossal run up in price); while adding that:
‘Had never been involved in GameStop and came to this right now, would I still be short this stock? 100 percent.’
‘This is an old school, failing mall-based video retailer and investors can’t change the perception of that,’ Mr Left added.
This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.
Act on share opportunities today
Go long or short on thousands of international stocks with spread bets and CFDs.
- Get full exposure for a comparatively small deposit
- Trade on spreads from just 0.1%
- Get greater order book visibility with direct market access
See opportunity on a stock?
Try a risk-free trade in your demo account, and see whether you’re on to something.
- Log in to your demo
- Take your position
- See whether your hunch pays off
See opportunity on a stock?
Don’t miss your chance – upgrade to a live account to take advantage.
- Trade a huge range of popular stocks
- Analyse and deal seamlessly on fast, intuitive charts
- See and react to breaking news in-platform
See opportunity on a stock?
Don’t miss your chance. Log in to take advantage while conditions prevail.
Live prices on most popular markets
- Equities
- Indices
- Forex
- Commodities
Prices above are subject to our website terms and agreements. Prices are indicative only. All share prices are delayed by at least 15 minutes.
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.
