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U.S. state regulator says GameStop trading could be 'systemically wrong': Barron's

Published 01/26/2021, 10:04 PM
Updated 01/26/2021, 10:05 PM
© Reuters. The GameStop store sign is seen at its shop in Westminster

(Reuters) - Top securities regulator in Massachusetts thinks trading in GameStop Corp (NYSE:GME) stock, which skyrocketed for a fourth straight day, suggests there is something "systemically wrong" with the options trading surrounding the stock, Barron's reported https:// on Tuesday.

The video game retailer's after-hours surge added to a 93% jump during Tuesday's trading session, with the company's stock propelled by traders on Wallstreetbets, many of them buying volatile call options.

"This is certainly on my radar," William Galvin, secretary of the Commonwealth of Massachusetts, told the magazine. "I'm concerned because it suggests that there is something systemically wrong with the options trading on this stock."

GameStop and the office of the securities regulator in Massachusetts did not immediately respond to Reuters' request for comment outside business hours.

The stock surged 50% in extended trade after Musk tweeted "Gamestonk!!", along with a link to Reddit's Wallstreetbets stock trading discussion group. "Stonks" is a tongue-in-cheek term for stocks widely used on social media.

© Reuters. The GameStop store sign is seen at its shop in Westminster

GameStop has surged more than seven-fold to $147.98 from $19 since Jan. 12, spurring concerns over bubbles in stocks that hedge funds and other speculative players bet will fall in value.

Latest comments

DFV ftw
William Galvin = 🌈🐻
💎🖕🏻💎
Awwww poor babies lost money now want to cry about it. They have been boning the little guy for years. Dont be mad im up 100% trading from an Iphone 🤣
You know how it goes. When the game doesn't go the way they wanted it to, the rules change.
what a tool lol
About time the people get theirs 💰
The Hedge funds losing billions now want to change the game. How amusing!!!
Who says it is the hedge funds who are losing money?
Check out report that Melvin is filing for bankruptcy. Its hedge funds losing money.
Nothing is wrong the stock had 106% short with 6 days to cover.
Its all fun taking money from small retail investors but no fun when it goes the other way and barely makes a scratch in the pockets of wall street. We get it!
Whatever. Do your research.
Investors are looking for more excitements because of the bull market created by unlimited QE.
Oh, oh NOW THE STOCK MARKET MIGHT be broken? ONLY THIS INSTANCE?! Not ever before?! OH, OH, mmmkay.... Is it because the market is not doing what YOU WANT?! * DISCLAIMER FOR THE LAST 100 YEARS * Trading can be a challenging and potentially profitable opportunity for investors. However, before deciding to participate in the Stock market, you should carefully consider your investment objectives, level of experience, and risk appetite. Most importantly, do not invest money you cannot afford to lose.
This one is a little different. This is an OPEN manipulation of the price. Exploiting market mechanics for personal gain is not investing. It is like if I go to the ATM machine and figure out the code that gives me more money than I have on my account -- it is not mine to keep because I was so smart and figured out bank secret codes. This will lead to SEC coming down with a lot of new regulation unfortunately.
You're right about increased regulations.Not so much about the rest of your post.
This was not manipulation. This was the Big Bois getting put in body bags by dudes who opened a robin hood account amd trade exclusively from their phones. We didnt change the rules in college basketball after UVA lost to UMBC in NCAA tournament. These HFs have a lot of info at their disposal and could have covered at any point. I suppose Tesla should be investigated too because the same thing happened with that stock.
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