Reddit’s StockMarket Takeover

Jack Engel, Section Editor

At the beginning of January, the market experienced an unprecedented amount of new traders, most of them young and inexperienced. The biggest reason behind this: WallstreetBets. WallstreetBets is a Reddit board of primarily young investors that congregate to discuss market trades. The group has added over 8 million members since its creation in 2012. With 8 million members, the group has profound influence when all are focused on one trade. This influence was on full display at the beginning of January when the group decided to buy stock in Gamestop. Simultaneously, Gamestop seems like a random place to trade 8 million shares of a company, their reason for the madness.

At the beginning of January, Gamestop’s stock was on pace to hit its 52 week low. As a result of this, many hedge funds were shorting or betting against Gamestop. WallstreetBets viewed these short contracts and saw this as a chance to get back at the many powerful hedge funds that are notorious for having a large influence over the market. Enlisting the power of their 8 million members, WallstreetsBets began to buy every share of Gamestop possible, ultimately driving the stock up 100 dollars. This caused hedge funds to lose millions of dollars on their short contracts, but the craziness didn’t stop there. This stock jump gained the attention of the world, the idea of beating the rich at their own game was too infectious. Millions and millions of young Robinhood or commission-free traders started investing any and all money they had into Gamestop’s stock, driving the stock price up to 300$. The youth were having a party and the wealthy were paying for it. 

The result of WallstreetBets success angered a lot as many lost money due to this. Many began to call for the removal of WallstreetBets of Reddit or for these young investors to be banned from trading for stock manipulation. However, the reality is it’s perfectly fine to do what WallstreetBets is doing. It’s simply young investors getting together to talk and buy stocks, Ironically, it’s very similar to hedge funds. 

With WallstreetBets continuing to operate, many await the group’s next target, after seeing what they accomplished last time with Gamestop. It’s now become clear that the control of the market doesn’t just belong to the rich anymore, but everyone!