World Wide Web - Virtual article causes surge in Gamestop stock value.
Three years ago, a significant event took place in the world of stock trading, and it seems like a familiar investor might be back at it again. Keith Gill, a well-known investor, published a screenshot on Reddit, indicating that he had invested over $175 million in GameStop stocks and options.
This investment resulted in a 21% surge in the stock's price, reaching $28. Furthermore, there was an additional gain of around 8% during after-hours trading. At one point, the stock's price even doubled from its previous Friday price.
Gill had reportedly purchased five million GameStop stocks at around $21, which translated into substantial profits for him. Moreover, his options to buy GameStop stocks at $20, set to expire on June 21st, suggested even more potential earnings.
But is the screenshot genuine?
There remains ambiguity about the screenshot's authenticity, along with the status of Gill's current control over various social media accounts. After a long hiatus, his profile on the Twitter alternative X resurfaced in May, sparking fluctuations in the GameStop stock market.
There are reports that Morgan Stanley-owned trading platform E-Trade could exclude Gill. In addition, the Securities and Exchange Commission (SEC) is exploring the trading of GameStop options in recent weeks.
Influencers lifting up GameStop's stock price
Due to the increasing dominance of online retail, GameStop, like many traditional brick-and-mortar chains, has been finding it challenging to compete. The stock had been seeing a steady decline for quite some time. Analysts predicted further decreases in its market value.
The Coronavirus pandemic made GameStop an attractive target for short sellers, who borrow stocks, sell them and then repurchase them at a lower price before returning the borrowed shares. However, many short sellers suffered massive losses at the beginning of this year as influencers like Gill boosted the GameStop stock's popularity. As a result, they were compelled to scramble to purchase stocks in the market, driving the price even higher.
