If you’ve been watching the financial market throughout the start of 2021, you’ll be all too aware of the drama caused around a few different stock choices that had been labelled as “meme” stocks with the likes of GameStop and AMC for example, and whilst the saga is far from over as the GameStop stock battle between online communities and Wall Street shows no signs of coming to an end just yet, it has shown that there are huge opportunities to be found for those willing to explore options as a retail trader, and how retail trading platforms may see change in the future too.
This certainly isn’t the first time retail traders have had a huge impact on the market as one of the biggest in the world in crypto currency is still undergoing change as those invested in bitcoin early are certainly reaping the benefits now, particularly as different online platforms particularly in gaming have started to become more accepting of the currency as this cs-go betting review shows those that already accept crypto for example, but certainly may be the first time that retail traders have directly taken on the bigger institutions.
(Image from reuters.com)
There’s plenty of information out there around how the GameStop short squeeze got started, but for the layman it came down to bigger institutions publicly stating they felt the stock wouldn’t succeed during the pandemic climate which would inevitably lead to more betting against it too, and the reddit community of wallstreetbets wanting to fight against the practice instead pushing the stock price higher. Whilst there has since been a lot of up and down and uncertainty, the prices rising now as retail traders have held on continue to raise questions around the way the big financial institutions have handled trading in the past, and even launched legal probes into both to discover what’s really going on.
Much of the big news also came as the retail trading platforms did something that many felt was against the interests of the traders they had supposedly been representing – back at the start of the year, on one day of trading RobinHood would go on to block the purchase of the GameStop stock whilst still allowing the sale at the same time – many traders suggested this was a catalyst that almost brought a premature end to the short squeeze just as it was at it’s tipping point, and this hadn’t been the only platform to do so either leading many asking for more transparency in the representation of these platforms and whether or not they’re really protecting the customer.
It’s certainly not the end of the saga and 2021 certainly belongs to the retail traders, and with many others perhaps inspired to try their own hand at trading options too, it may not be the last we hear of a wider community moving into the space that had typically been dominated by the bigger financial institutions.