Gamestop share price (GME) doubled in price… Again?!
On the 24th of February 2021, the Gamestop share price had another flurry of investors piling in on an unconfirmed ‘short squeeze’. This is just weeks after Reddit’s wallstreetbets fuelled share gain; that saw the share price rise 2816% from a low of $17.15 to a high of $483 in a matter of 2 weeks.
Following the Great Squeeze at the end of January, many made their fortunes by exploiting a once-in-a-decade event, known as a huge ‘short squeeze’. Last seen with Volkswagen in 2008, these events occur when big investors, usually hedge funds, ‘short’ shares beyond their market availability.
Whilst we will look into exactly how shorting works in a further article in the coming days, it’s important to note that joining these ‘meme share’ hypes is incredibly risky business. This is due to their volatility, with GME dropping to as low as 60 from 150, before reaching 320 in a mere day and half. Many expected this to be the end of the story…
The reason for yesterday’s gain is unconfirmed presently, but various sources are saying that it’s another short squeeze, while others are suggesting it’s due to an executive move around.
Gamestop share price stats as of 24/02/2021
Average Volume traded:
Is the GME / Gamestop worth trading?
Now you may now be thinking to yourself; ‘I want to join the action’, however, we strongly suggest you stay well clear of this share. While there are hundreds of success stories out there for people that quite literally ‘made bank’, there are also thousands of unheard stories about investors that are in huge amounts of debt, due to irresponsibly using leverage on their positions.
While the point of Reddit’s Wallstreetbets is valid and strong, unfortunately playing one or many hedge funds at their own game is only ever going to lose in the long run, as they have a multiple of millions… or billions to play with, while private investors are all limited by quite often hundreds/thousands.
Should you play them at their own game anyway, please act with extreme caution as you may find the bullish trend reversing just as quickly as it was formed.
If you’d like to see a list of fundamental qualities a successful trader displays, please see our ‘The Trading Mindset’ article! These are qualities you should most definitely be comparing yourself to before committing to a trade.