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Massive short squeeze in GameStop

Massive short squeeze in GameStop

GameStop is a U.S. videogame retailer that raised more than 50% during Monday’s trading day. Looking at the year performance the stock raised by 250%. The main reason for the stock's huge growth is 30% interest coverage on the stock which implies coming short-squeeze. That day is Monday when traders betting on the shorts had to quickly buy back into the stock to cover potential losses, defined as a short-squeeze, and retail investors piling in to benefit from the surge. On the other side after a huge bull run, Telsey Advisory Group decreased their recommendation from outperform to underperform.

"The sudden, sharp surge in GameStop's share price and valuation likely has been fueled by a short squeeze, given the high short interest, and, to a lesser degree, speculation by retail investors," announced GameStop. "We believe the current share price and valuation levels are not sustainable ($95)," added.

Performance of GameStop’s shares (Tradingview.com)