almost 3 years ago • 1 min
Four months after US video game retailer GameStop hit the public consciousness as the focal point of a battle between smaller investors and short-selling hedge funds, many metrics around the stock have returned to normal levels. Just one remains absurdly elevated: the price.
As the chart above shows, both GameStop’s 30-day volatility (in blue) and its trading volume (in green) have dropped back to their historical averages after a crazy few months. Yet despite these signals that traders no longer have much interest in the company, its share price (in pink) is still sitting on an 800% gain for the year.
This combination of data suggests the retailer’s stock price is being supported by investors who purchased shares as a way to stick it to the suits on Wall Street – a cohort who are reluctant to sell lest they let down their fellow “apes” on Reddit’s WallStreetBets forum.
While GameStop still consistently tops charts of the most-discussed stocks on WallStreetBets, the rest of the world has moved on. The proportion of the company’s tradable shares sold short, for example, has plunged from 144% at the start of the year to just 20%.
How much longer can GameStop’s shares remain at these levels before the company’s new diamond-handed investors eventually tire of owning stock in an unprofitable retailer?
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