Shares of GameStop (GME) are surging after meme trade influencer 'Roaring Kitty' posted a screenshot on social media showing a $175 million position in the company's stock. Matt Kohrs, host of The Matt Kohrs Show, joins Wealth! to share his insights on the frenzy surrounding this development.
Kohrs distinguishes trading from investing, stating that the two are "completely different sports that happen to be played on the same field." When it comes to GameStop, Kohrs acknowledges that while the stock is currently generating profits for investors, he cautions against chasing the movement, saying it's "much more of an active trade, not an investment."
However, when asked about the longevity of the meme trade phenomenon, Kohrs expresses a bullish outlook. "I actually believe the momentum could be carried for a while ... Momentum's going to beget more momentum," he tells Yahoo Finance.
For more expert insight and the latest market action, click here to watch this full episode of Wealth!
This post was written by Angel Smith
Video Transcript
Gamestop skyrocketing right now.
It's up by about 29% as it's holding on to gains as we have just seen there on the screen this after a Reddit account linked to Keith Gill, also known as Roaring Kitty posted what appears to be ownership of a significant amount of shares and call options.
Now, we should note we could not independently verify the validity of the post in case you don't know though Gill is widely credited for influencing gamestop's 2021 short squeeze for more on how you can take part in the meme trade.
Should you so choose?
We have Matt Coors host of the Matt Core show.
So Matt, we were discussing this earlier during the nine am hour as well.
And one of our guests from interactive brokers, Steve Sosnick pointed out that you shouldn't be chasing certain trades, but there's a difference between a trade and an investment decision as you and I have discussed in the past, yes, 100%.
And I guess I just really want to reiterate that to everyone listening to this trading and investing the way I like to describe it the best metaphor I could come up with is the fact that there are two completely different sports that happen to be played on the same field and time and time again, we see a lot of people who may, they get into it for one reason and then they switch to the other side during the trade or the investment because things aren't going right.
And I just want everyone listening to know whatever your plan is, stick to it and don't change it halfway through the game.
Yeah, I'll pose this question to you as well.
I mean, we talked about the historical element of this.
Everybody remembers when you know, everybody and their grandmother was talking about the ticker symbol, GME and A MC and what the thesis was back then it was to really make sure that everybody and, and the little guys and retail traders uh out there were kind of ganging up on the big money, those who had heavily shorted gamestop.
What is the thesis at this juncture from the best kind of analysis that we could layer on to it when you don't have that type of outsized short position that a lot of the institutional money has built up, makes me think of the old adage.
Don't let the truth get in the way of a good story because right now that's still the story.
And as you just alluded to the interest, the short interest is nowhere close back in 2021 it was 120% as we're talking right now, it's around 19%.
But right now people are still buying into that classic David and Goliath movement and it's working because overnight Gamestop added $5 billion to its market cap.
Now.
Does it have the same juice?
The same, I guess underlying ingredients to make something go crazy.
It's kind of tough because don't forget, back in 2021 not only was there a sky high short interest of 100 and 20% everyone was locked inside looking for some sort of community interest rates were at zero.
People were getting stimulus checks right now.
We're just in a different place in the world.
So I wholeheartedly believe money could be made to both the upside and the downside.
But in my personal opinion, this is much more of an active trade, not an investment where you would want to chase it after pumping 30%.
Yeah, we're taking a look at Jamie shares right now on screen and uh a lot of our um viewers who are old enough to remember where it was trading at earlier in the session, remember seeing it up 70% almost 80% right now.
It's only up by about 30%.
Still not shabby of a gain.
But what does this tell you about the meme frenzy if you will or just the, the mindset uh in terms of how long a momentum trade can last versus the time period before where we saw it go on for sessions weeks almost.
Yeah, that's an excellent question.
And I actually believe the momentum could be carried for a while.
I, I think really momentum is going to beget more momentum.
So as long as things are trending, I think there's actually a greater chance of it continuing to trend, especially because of some of the underlying excitement of what's going on in the options market.
If people continue to pour into it, it's gonna end up becoming a self fulfilling prophecy.
So it's kind of really how many people buy into the concept of the movement as a whole.
And when you think about, of course, just this one name, there's so many others that kind of got pulled into the broader memetic mindset if you will, where are the other perhaps opportunities that are out there for those who are trying to figure out?
OK, I don't wanna chase gamestop, but I wanna best anticipate where some of this flow could be moving around.
Yes.
Uh Like you said, a lot of those laden names are getting a similar sympathy reaction.
But in my book, it's kind of really hard to be better than or really duplicate the original.
So I think most eyes, most trading, most excitement is on GME.
But that other basket of quote unquote meme sucks.
Yeah, there's gonna be some sympathy there but in terms of how to play it, how to trade it as you alluded to by no means, would I chase if I do want to go in?
Understand that it's a high risk, high reward play, obviously, never put more money on the table than you're willing to lose.
And I think right now there's maybe potentially a lot of novice people joining the market thinking that every single day is the same in the options market.
And I want to clarify to anyone listening and this is maybe potentially a bit more of a deep dive, volatility is extremely high.
So whether you're buying calls or buying puts, there's a good chance that you're over paying.
"trade" - Google News
June 03, 2024 at 10:54PM
https://ift.tt/U9RdALO
GameStop is an 'active trade,' not an 'investment': Matt Kohrs - Yahoo Finance
"trade" - Google News
https://ift.tt/3Oxz7Jf
Tidak ada komentar:
Posting Komentar