Small investors bring down the stock market again with GameStop | The State
The small investor revolt has boosted GameStop’s value 236% this week./
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Spencer Platt / Getty Images
On Friday the stock market was expected to be convulsed and it was convulsed. The main stock indices moved in losses all day and with them closed the week in which small investors have stood up to the riskier hedge funds (hedge funds) with bearish positions in companies such as GameStop, AMC, Blackerry and even American Airlines among others.
Robinhood, the platform that has made it easier for small investors to access the stock and option markets (cheaper), on Friday released part of the restrictions it imposed on Thursday and that returned the markets to a certain normality. With the freedom to act again the small investors animated in forums of Reddit and Discourse, the value of GameStop rose again and thus hurt hedge funds.
But less than an hour after the close of the stock market it was learned that Robinhood had once again imposed restrictions on purchases of shares of 50 companies including Starbucks, General Motors, AMC and of course GameStop.
Despite this, the Dow lost 620 points (-2%), the Nasdaq 266 points (-2%) and the S&P 500 fell 73.14 points (-1.93), that is, in negative so far this year after the worst week since October. While GameStop a business that is closing stores, closed the week appreciating 236% and AMC 181% above how it had started.
The markets regulator, the SEC, has begun to investigate if there is a possible manipulation of the markets and if platforms such as Robinhood, Ameritrade or Interactive Brokers among others have restricted the possibilities of participating in the markets.
The curious situation in the world of investment in which hedge funds are being knocked out at their own game by small investors is leading funds like the giant Citadel to deny that they had anything to do with the decision of the Investor platforms to limit brokerage. Some users of these platforms have filed lawsuits. Since Thursday there is a collective in Manhattan against Robinhood.
Some names of relevance such as Elon Musk continue to encourage these investors to stand up to the traditional stock market players. The Republican congressman from Florida and close to Donald Trump, Matt Gaetz, also encouraged these investors who he appreciated that they were going against the elites.
GameStop is currently highly overrated. The titles of this company closed on Friday with a value of $ 325 and a year ago they were valued at $ 3.93. When positions begin to undo many small investors can lose 100% of the investment.
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