Here we go again?
It’s all feeling very 2021 this week as GameStop — which, until three years ago, was a quietly ailing gaming retailer — has once again regained its status as the meme stock du jour, with shares in the company gaining more than 180% so far this week.
Why GameStop is soaring, whether its rise was weeks in the making (options trading suggests maybe yes?), and how this saga will end for the company and its flurry of new investors, are all fascinating questions. Another is: just how much money is actually changing hands in GME stock?
Although we might be numb to meme stock moves at this point, it’s worth reminding ourselves just how extraordinary these phenomena are. Stocks moving 50%+ in a day isn’t completely unheard of, but those kinds of swings are usually reserved for thinly-traded stocks with low liquidity. That’s not what’s happening here.
Data from Koyfin reveals the list of the most-traded stocks in the US & Canada yesterday. The table reads: Nvidia, Tesla, GameStop, Apple and Berkshire Hathaway. Right there, in between some of the biggest companies on Earth which trade billions of dollars everyday, is GameStop.
Indeed, for companies of its size (which we’ve defined loosely as $5-25 billion, but recognize that it’s something of a moving target), GME’s trading volume — which surpassed $10 billion yesterday — is a serious outlier. The average for that subset of similar companies? Just $94 million.
