GameStop's shares closed at $90, down from a peak of $483 last week, as other Reddit-fueled stock trades like AMC suffer similar reversals
- Shares of GameStop skidded further before Tuesday's opening bell, with shares of the volatile retail-trader favorite sliding more than 40%, and then extended those losses during market hours.
The synchronized pullback matters because the same retail-attention network that accelerated gains across several names is now transmitting losses across them.
First-order effects
GameStop shareholders face a sharp reset in the value of a position that had recently reached $483, while AMC holders are experiencing a comparable reversal.
GameStop and AMC become the immediate focal points of a volatile Reddit-driven trading cycle rather than isolated company-specific moves.
Second-order effects
The decline weakens the near-term case for traders to rotate Reddit attention into the same cluster of heavily discussed stocks, after that attention had already spread beyond GameStop.
Price action in GameStop and AMC becomes a shared signal for participants following r/WallStreetBets, making the group more sensitive to shifts in collective trading interest.
Third-order effects
If this rise-and-reversal pattern repeats, retail social platforms will function as increasingly important liquidity networks: they can rapidly concentrate trading in a few public equities and just as rapidly unwind it.
The episode points to a market structure in which attention can link otherwise separate companies into a single high-volatility trade.
The trend: Retail-investor communities are turning social attention into a liquidity network that can rapidly amplify—and reverse—trades across multiple stocks.
Redditer says he's down $400k in GameStop losses but he will not sell. Tells WaPo he has “been poor for too long” and works “a god awful amount of hours for a garbage company” and sees betting on popular “meme stocks” as a way to potentially strike it big https://www.washingtonpo…
It's all fun and lols until the meme bubble bursts. This Dutch college student knew nothing about GameStop before pouring most of his savings / college money in. “Being a part of r/wallstreetbets, it's like a religion.” Here's his bedroom Elon God thing https://www.washingtonpost…
I was in early on some crypto assets in this rush and made a minor profit, which I mostly just chipped away with my other amateur trades trying to follow trends. And even that expedition was funded by other minor crypto profits I already had from years ago. My smarts was... luck.…
“'it's like a religion you're devoted to,' he said on a Tuesday phone call from his parents' home, where, in his bedroom, he has hung up a printed-out meme image featuring Jesus Christ, the Virgin Mary and Elon Musk, GameStop's logo shining from above.” https://www.washingtonpost…
This is why journalists and those with big platforms need to show a bit of restraint during the surge phase - buying into the “bankrupt the hedge fund” / bants / etc narratives risks urging people on. And some then lose a *lot*. https://twitter.com/...
I'm still hearing from r/wallstreetbets folks who lost a ton in the GameStop crash today. It's grim. One trader who posted “stay strong” earlier today just wrote me, “I actually just lost everything. ... 100k invested. ... im devastated” https://www.washingtonpost.com/ ...
Investors getting the full GameStop experience as they try to return something they thought had value and are only offered pennies on the dollar. https://twitter.com/...
@thespybrief “Financial bloodshed?” “The Reddit forum that helped kick off the frenzy has given way to anxiety, financial bloodshed and infighting” Who could've seen it coming? https://www.washingtonpost.com/ ...
The casino industry is regulated by a host of state-level “responsible gaming” statutes to combat gambling addiction. Can anyone read all these GameStop stories and tell me the day trading platforms shouldn't have something similar? https://www.washingtonpost.com/ ... https://twi…
Thanks for allowing us to dump on retail investors at higher prices, Robinhood. Let us know if you need more capital to survive. —Yours sincerely, the Asset Managers. “GME sank 34% in US pre-market trading, extending a 31% plunge on Monday. AMC slid 25%” https://www.bloomberg.com…
Well, yes. If your strategy to screw Wall Street was to give all your money to Wall Street, then this happens. I suggest better strategies. https://twitter.com/...
Robinhood's C.E.O., Vlad Tenev, Is in the Hot Seat. Vlad Tenev has incited the fury of the trading app's fans amid a stock market frenzy. His lack of preparedness on nuts-and-bolts issues was part of a pattern, former employees and analysts said. https://www.nytimes.com/...
“There's a consistent pattern which makes one question whether he knows what is going on inside his company.” @nathanielpopper, @eringriffith and me on the tenure of Robinhood CEO Vlad Tenev, whose company is under siege. https://www.nytimes.com/...