Reddit has become a hub for social-media driven traders and investors that have proven their ability to maneuver the markets, injecting huge volatility into stocks like GameStop and AMC. But what stocks are grabbing attention on Reddit today?
Below may be a list of the highest 10 most mentioned US stocks on the WallStreetBets thread on Reddit over the last 24 hours on September 28, 2021, consistent with data from Quiver Quantitative. Exchange-Traded Funds (ETFs) are excluded.
Clean Energy Fuels
Tesla has rocketed to the highest of the list overnight after reports surfaced over the weekend that CEO Elon Musk had sent an email to staff stating this may be the company’s ‘most intense delivery week ever’. That was followed by reports from Reuters that Tesla’s factory in Shanghai in China is about to supply 300,000 cars during the primary nine months of this year. Tesla exports the bulk of its China-made cars but also sells them domestically. Separately, Tesla said it’ll release its Full Self Driving software , but only to people who achieve a high enough safety score, every week on Friday. Tesla shares ended up 2.2% yesterday and closed at their highest level since February.
Canoo shares closed down 8% yesterday, sliding back after rocketing on Friday as investors piled-in amid a possible short-squeeze.
SmileDirectClub is another potential short-squeeze candidate and closed up over 4% yesterday, but the stock remains down over 49% since the beginning of 2021.
Clean Energy Fuels shares surged 12.5% yesterday to finish at their highest level since early July.
Alibaba shares bounced back yesterday and rose 3.5% after ending last week at their lowest level since January 2019. Investors are going to be closely watching to ascertain if the Chinese giant has finally bottomed-out after being hammered by the regulatory crackdown in China, or whether the stock will continue to hit new lows.
Palantir shares closed down 4.4% yesterday to bring an end to its three-day streak , having did not breach past its highest level since February.
GameStop saw its price target move $24 from $25 by Ascendiant Capital Markets yesterday, with brokers believing the stock is heavily overvalued at $188 before the opening bell today.
TMC Metals shares rebounded yesterday after closing last week at their lowest level since going public through a SPAC deal earlier this month. Its highly ambitious decide to produce battery metals by scraping nodules off the ocean floor initially sparked excitement when it first listed but the stock has lost considerable ground as questions are raised about the value of its plans.
Logistics and transportation firm Ryder System may be a new entrant overnight as shares climbed to their highest level since May yesterday.
Retail investors realised their potential power in early January 2021 when a loosely-coordinated strategy was formed on Reddit’s WallStreetBets chatroom to shop for shares and out-of-money call options on stocks that were being targeted by short-sellers to push the worth higher. the thought was to make a short-squeeze.
A short-squeeze does what it says on the tin – it tries to squeeze short-sellers out of their positions. Short-sellers, mostly big institutional investors and hedge funds, bet that the worth of a stock will fall but, as retail investors pile in and push the share price higher, they’re forced to start out buying the stock to undertake to limit their losses. The buying by the large players only fuels the share price higher.
The fact many of the stocks being targeted are fundamentally flawed or failing adds increased risk into an already volatile picture. GameStop is an out-of-favour retailer that sells physical video games during a time when games are mostly being bought online, while others like Blackberry also are laggards from the past.
With this in mind, it’s unsurprising they were within the crosshairs of short-sellers that search for failing companies to bet against.
But why are retail investors banding together to shop for shares in flawed companies? This disconnect is partly explained by a growing resentment among the smaller players within the market, which afflict the thought of huge institutions taking advantage of a company’s failure through short-selling practices, creating what has been described as a ‘David vs Goliath’ battle.
It is important to notice that not all the foremost actively-discussed stocks on Reddit are struggling or being targeted by short-sellers. Many of the foremost mentioned stocks, like Apple, are simply popular among the community.
The stark movements in stocks like GameStop has demonstrated the facility and influence that social media-driven investors and traders can wear the market, having injected severe volatility into several stocks. Volatility presents opportunities for traders, and it doesn’t get more volatile than Reddit stocks immediately – even during an epidemic .
For example, we saw GameStop – the primary heavily-shorted stock to be targeted by social media-driven investors – go from below $19 at the beginning of 2021 to a replacement record high of over $347 by January 27, and therefore the share price has remained highly volatile ever since.