What We Can Learn From The GameStop-Reddit-Wallstreetbets Debacle?
Unless you’ve been living under a rock you would have heard about the way that amateur traders gathered on Reddit and made the share price of GameStop go through the roof. The idea was to fight against the Wall Street professional traders that placed huge short trades on the stock.
In the end many professional traders from Wall Street firm lost up to billions of dollars. It’s ironic because GameStop has no real value that represented the huge rise in stock price. In fact, the company indicators show that it is going towards bankruptcy. So what can we learn from this story?
Trading can be creative
The idea of going up against the big boys in Wall Street is ambitious, but this story shows that with enough creativity it can be done. Think about the trades you’d like to place in your own portfolio. The sky is the limit since you can be as creative as you need to be in order to make money.
The winnings go to those who are not afraid to take risk and carve out their own success. Out of the box thinking is usually rewarded in life and this story is an example of that. You can make the same type of crazy trades when using online brokers, which you can find more here . Create a strategy that’s creative and don’t be afraid to execute.
No real regulation of stock market
The manipulation of the stock from Reddit users shows that the stock market can be manipulated if enough people get organized and have a plan. The organizations that are supposed to oversee the stock market don’t do a good enough job, which means someone could be pulling the strings and having an unfair advantage.
This is a big sign that something must be done to increase the amount of regulation in the stock market so there is order and fairness to the proceedings. We will need to see if there will be a chance after this big story. Changes usually come from necessity and it might be the case here.
Anyone can make money
Trading is an activity that anyone can make money from – not just the Wall Street professionals. Nowadays, with the apps available and smartphone technology the ease of access is amazing. You can trade while you are walking down the road or travelling to work on public transport. Just make sure to place calculated bets and you can also make money like the people in this story.
Final Thoughts
This is one of the more interesting stories related to stock trading. The video game store GameStop is not a stock that you would have thought will skyrocket because it was going bankrupt. However, the opposite happened of what everyone what.
Let’s keep an eye on the story to see what develops. Perhaps there will be more of these scenarios where the amateur traders fight back against Wall Street professionals that have been making money for years unchecked.
