GameStop Stock the real Game Changer By the retailer.
GameStop Corp. is an American video game, consumer electronics, and gaming merchandise retailer. The company is headquartered in Grapevine, Texas, United States, and is the world's largest video game retailer. The company was first founded in Dallas, Texas in 1984 as Babbage's, and took on its current name in 1999. It came into Headlines when the company was almost going to shut down and the Stock price goes Sky Rocket.
But GameStop’s story has become the centrepiece of global financial markets after a bunch of retail traders part of a Reddit group called WallStreetBets discovered that if they buy and hold a stock with heavy short positions, the short-sellers will be forced to run from pillar to post to cover positions. The result will be a tremendous in size short squeeze, the likes of which even Wall Street has not seen.
Due to this the shares of the company, which had been sleep-walking towards bankruptcy for some time now and have seen solid consolidation, have risen more than 220 per cent in January alone, because of the short squeeze.
The short selling is when you Sell the Stock and it outperforms or goes down the negative values is your profit.
e.g. You Sell Stock At $100 and the stock price goes down till 50$ your profit is 50$, And if the stock goes up to 140$ your Loss is 40$.
On the other side, if the stock price moves in the opposite direction, the trader has to buy the security at whatever price available to cut losses, more importantly, to honour the trade since the shares have to be delivered to the person they are sold to at the start.
Due to this Big Investment Company faced many losses as the Stock goes 17$ to 481$ which is almost 30 times.