American amateur retail traders aren’t the only ones jumping in to invest in stocks that have been promoted on a popular Reddit board.
A bunch of retail investors is converging on historically not-so-loved stocks such as GameStop and Bed Bath & Beyond. Inspired by the Reddit board r/WallStreetBets, traders have jacked up the share price of these companies, with GameStop climbing over 1,000 percent in just two weeks. And their actions are no different from any other stock buyers in that they wanted to buy a stock and they did, all 100 percent legally and within the system’s rules.
This buoyant market action ended up giving heavy losses for some hedge funds, you know, the investors who make money by destroying a company by talking it down publicly only so that they can sell the stock shot and make a windfall. We reported on one of the most high profile cases which was Melvin Capital, the hedge fund firm that closed out its short position on GameStop after taking a gigantic loss.
This stock trading fever seems to be spreading overseas. The Finnish telecoms company Nokia on Wednesday was sucked into the frenzy of the market activity going on when it saw its US-listed shares jump up to 40 percent. Then on Thursday, the stock went down to about 23 percent in New York and about 13 percent for its Finland-listed shares.
Nokia gave a statement on Wednesday where the company said it doesn’t know of any recent corporate programs or developments “that would account for the recent increase in the market price or trading volume of its shares.” That makes sense because the increase in activity for its stock is because of a bunch of retail amateur investors who targeted the stock so that more of their own kind of people would buy it and thus cause the value to go up. There is nothing illegal about this, but the elite trader class on Wall St don’t like the phenomenon, because they and only they are allowed to manipulate the market and who cares if the hedge fund guys destroy a few companies in the practice of their selling short, right?
Trading 212 warned of disruption to its service due to an “unprecedented increase in demand” on Wednesday. The platform informed users Thursday that it was halting new positions in GameStop and AMC, another stock featured on r/WallStreetBets, “as highly unusual volumes have led to an unprecedented market environment.” In a tweet Thursday, the London-based firm said it had temporarily stopped onboarding new clients due to “unprecedented demand.”
Many other trading platforms saw stronger demand for stocks that were made prominent on the popular subReddit which now can boast 4.4 million users.
The popular instant messaging and chat site Discord banned r/WallStreetBets for “hate speech, glorifying violence, and spreading misinformation”, a spokesperson for Discord said. “To be clear, we did not ban this server due to financial fraud related to GameStop or other stocks” Right, it’s all just a perfectly understandable coincidence. They used the Woke Supremacy terms for cancel culture attacks, so now you know you shouldn’t use Discord anymore, because they do not have your best interests at heart. They are a part of the Supremacy. It’s ironic too because the term discord means a disagreement between people. So now all of these amateur traders are what, white supremacists? This is insanity!
The British firms Freetrade and Hargreaves Lansdown are said to be monitoring the situation, while an Israeli trading service called eToro told CNBC it will continue to urge their customers “to be mindful of their actions and protective of their capital.”
“In today’s highly volatile market conditions, we have been urging our users to stick to the basics of investing: diversify, avoid leverage, and only invest in markets and instruments with which you are familiar,” the eToro spokesperson said. “We have been working to remind our users that regardless of whether or not some stocks are in bubble territory, such a strong bull rally should be approached with caution.”
Some of the great unwashed European amateur investors told CNBC they bought shares that were recommended on the r/WallStreetBets subreddit.
A trader who wished to remain anonymous from Dublin said she put money into AMC and Blackberry because they were recommended by a Reddit user and that her investment is now up.
Richard Forde, a 31-year-old communications professional in Dublin, bought up shares of Nokia, BlackBerry, and AMC on recommendations from the r/WallStreetBets group on Reddit, and according to Forde, he’s up 25 percent all across his shares in GameStop, Nokia, BlackBerry, and AMC.
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Idiots Twerk On Ambulance After Shooting In Oakland, CAWhat’s going on is a fairly large amount of people have been turned on to trading online during the COVID-19 lockdowns. The Reddit users got sick and tired of hedge fund guys screwing over their stock investments by selling short. It’s not just that the hedge fund elites used strategies to sell stocks short, many of which the Reddit users owned shares, but it was the fact that they would then go on CNBC and other platforms like YouTube channels and whatnot and trash talk the stock to force the price to go down as skittish investors who didn’t wanna lose their money when they heard the so-called “experts” telling them to dump the stock. So, the amateur retail investors did the exact opposite and started buying targeted stocks to make the value go up. But the elites didn’t like it when they took a bath for once. The difference is that unlike the great unwashed amateur investors, the elites have friends in high places.
Rich is a conservative syndicated opinion writer and runs Maga-Chat.com. He writes about politics, culture, liberty, and faith.
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