In the last few months, Wall Street’s most shorted stock, GameStop (GME) has had more ups and downs than a roller coaster.
As recently as December, over 100% of the float was sold short, and noted short-seller Citron Research has been vocal on why it believes that the stock is going to $20.
However, that statement turned against Citron when it grasped the attention of retail investors on the Reddit forum WallStreetBets. A coordinated effort by the investors on the forum to bid up to stock forced short-sellers to cover their shorts, causing the stock to go up even further.
The event is referred to as a short squeeze, and it resulted in shares surging more than 250% in a month and over 500% at the highs.
The parabolic rise in the stock price was also fueled by last week’s announcement that Ryan Cohen, co-founder and former CEO of online pet-product retailer Chewy (CHWY), will be joining the board along with two more former Chewy executives.
The brick and mortar retailer is attempting to make a sharp U-Turn as it aims to adapt to the digital age and shift away from its current model.