Short-sellers have lost a staggering $70 billion in the War on Wall Street between institutional investors and day traders on Reddit.
Day traders on Reddit began driving up the price of stocks traditional Wall Street investors had recommended shorting, most notably GameStop, which saw its price go up some 1,000%. AMC, Bed Bath and Beyond, Blackberry and others also saw stock jumps as a result of the day traders.
None of the companies in question saw their stock rise as a result of any fundamental change or improvement in their business. Instead, the phenomenon seemed to be a continuation of the Wall Street protests following the ‘08 crash, with everyman investors teaming up to stick it to Wall Street. Even Reddit co-founder Alexis Ohanian, Sr. highlighted how the whole situation was showcasing the power of community.
That community effort is taking a tangible toll on Wall Street, with Reuters reporting that investors have lost some $70.87 billion as a result of their short positions on US companies. GameStop makes up a sizable portion of those loses, coming in at $1.03 billion, Bed Bath & Beyond, meanwhile, accounts for $600 million.
It remains to be seen where this saga will end but, now that everyman traders have had a taste of the power they can wield, it’s hard to imagine stock trading will ever be the same.