How GameStop Stock Became Hedge Fund’s Worst Nightmare After a Reddit-Driven Frenzy

GameStop may well be a nondescript struggling chain of video game retail stores in the US, but if its stock price is anything to go by, then it is definitely more in demand than the hugely popular Facebook, Apple, Amazon, Netflix and Google group of stocks that has even made Indians look at the US stock market for investment opportunities. Shares of GameStop have surged from $19 on December 31, 2020, to $197.84 on January 27 – a gain of nearly 1,900 per cent. It all started when well-known hedge funds like Melvin Capital and Citron Research got interested in GameStock shares. These funds are known to target stocks that they feel are overvalued by going short on the shares.

RELATED: Robinhood to allow ‘limited buys’ on GameStop, AMC on Friday

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s