Gamestop stock: why share price of GME rose by 104% on Wednesday - plus WallStreetBets terminology explained

The stock price of Gamestop is again enjoying a steep rise (Getty Images)The stock price of Gamestop is again enjoying a steep rise (Getty Images)
The stock price of Gamestop is again enjoying a steep rise (Getty Images)
The price of shares in Gamestop rose by 104% on Wednesday

The stock price of Gamestop is again soaring weeks after its shock rally and catastrophic dive shook Wall Street.

On Wednesday shares in the video game retailer spiked upwards by 104% and then jumped a further 85% after hours.

Hide Ad
Hide Ad

It’s believed that users of Reddit’s WallStreetBets could be behind the meteoric rise after AMC Entertainment, Blackberry and Koss also saw steep rises. The four stocks are favoured by retail traders.

Why has Gamestop’s share price gone up?

Analysts are unclear why the stock price of the video game retailer has shot up yet again.

Some have suggested that a Tweet by activist investor Ryan Cohen, a major shareholder with Gamestop, is behind the move.

On Wednesday afternoon Cohen tweeted a picture of a McDonald’s ice cream cone along with a frog emoji.

Some retail investors interpreted the tweet as a secretive message indicating that the investor would fix Gamestop - previously regarded as a failing business by some, in the same manner that news of McDonalds fixing their famously faulty ice cream machines leaked weeks earlier.

Analysts are baffled by the claim. Michale Bachter of Wedbush Securities said “I don’t know what an ice-cream means,” adding “people are looking for signals.”

Some experts have pointed to the resignation of Gamestop’s chief financial officer which may indicate that Ryan Cohen’s influence at the company is growing.

“GameStop announced the resignation of its CFO last night. Some may have taken this as a good sign that RC Ventures is making a difference at the company in terms of trying to accelerate the shift to digital," said Joseph Feldman of Telsey Advisory Group.

WallStreetBets terminology explained

Hide Ad
Hide Ad

Some WallStreetBets users have expressed their surprise at the stock’s return to form.

To outsiders the conversations between users of the subreddit can be baffling, with the use of memes and in jokes prevalent.

Here’s a breakdown of the key phrases used by WallStreetBets users.

Diamond hands: a trader willing to hold onto stocks or securities for a long time due to a belief in the success of their investment

Paper hands: a trader who sells stocks and securities too early and fail to maximise profit.

Pump and dump: when a stock is hyped or “pumped” with no data to back it up. Once stock prices are increased the poster accused of pumping and dumping sell for profit.

Stonks: an intentional misspelling of stocks, stonks is typically used ironically to refer to an investment which incurred a significant loss

Tendies: used by users to highlight a gain on an investment

To the moon: typically accompanied by a rocket emoji, this is used by traders to express their belief that an investment will enjoy a dramatic gain in overall value.