‘Short selling controversy’ game stop plunged 44%

Input 2021.01.29 07:59

Intraday surged to $450, closing $193.60

The stock price of GameStop, a video game retailer in the United States, plunged 44% on the 28th (hereafter local time). As it became known that GameStop became a target for short selling (investment that borrowed stocks) of hedge funds, individual investors who opposed short selling concentrated buying, and the stock price recently surged.

On the 27th, the stock price of GameStop also soared 135%. However, as the stock price fluctuated so greatly, Robin Hood, a stock trading site for individual investors, restricted the trading of GameStop, and the stock price of GameStop soared to $450 in the morning and fell to the lowest level of $130. Based on the closing price on the 28th, it was $193.60, down 44.11% from the previous day.

The US Senate and House of Representatives decided to hold a hearing on GameStop as Robin Hood restricts trading of items that ants intensively bought, including Gamestop.

It is analyzed that the surge in GameStop’s stock price negatively affected the overall US stock market by making unusual transactions in which individual investors lumped together through the online community to intensively purchase certain stocks.

White House spokesman Jen Saki said, “Both Treasury Secretary Janet Yellen and the White House economic team are monitoring the game stop situation.”