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The GameStop meme stock is back - shares in the company spiked by over 80% after a famous face in the home trading world popped up again.
Keith Gill, better known as 'Roaring Kitty', was one of the first people to push GameStop stock purchases to his followers back in 2021. The massive part he played in that stock market adventure earned him notoriety, an appearance in front of Congress, and a movie where he was played by Paul Dano.
Now he's back, and posted on Reddit suggesting that he'd made another enormous bet on the gaming retailer - this time to the tune of a staggering $116 million.
— Roaring Kitty (@TheRoaringKitty) May 13, 2024
The post has become an absolute juggernaut, receiving some 88,000 upvotes already, and it's already set people making major GameStop trades.
Some $390 million has already been traded in GameStop shares today, according to The Guardian, and there's every chance that this will be a revival of the frenzy from 2021.
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Gill had been largely silent on the hugely influential Reddit account that he'd used to update followers and show people what bets he was making, so this is a pretty seismic return for many of the traders who used to follow his every move.
However, it's not a total surprise, as Gill had been posting teasers and cryptic images on his X (formerly Twitter) account since the middle of May, fuelling speculation that he was plotting a return.
In fact, even those posts alone, without any substantial detail, were enough to send GameStop's shares on a bit of a rise a couple of weeks ago.
Back in 2021, GameStop stock rose more than 1,000% during Gill's first campaign, and it wasn't the only spiking meme stock: the struggling cinema chain AMC Entertainment jumped 2,300% in a similar window.
The crowd-led movement came in defiance of several Wall Street hedge funds and major institutional investors, which had shorted the stock amid GameStop’s financial struggles at the time.
Investors short stocks when they believe a company’s share price is likely to fall, borrowing the stock and selling the shares, intending to later buy them back at a lower price to make a profit.
The hedge funds’ short positions meant they thought GameStop’s share price would continue to tumble.
Now the signs are pointing to another possible rally, although stock market volatility makes it hard to know whether this will really stick the landing once again.
So, if you have a keen interest in the stock market, there's a lot to check in on this week, although it's always worth taking all the risks into account before making any big financial moves.
