This changed the dynamics of investing somewhat – you’d think in favor of the little guy – though it remains to be seen if retail investor success has eaten into the profits of the big guns on Wall Street. The internet has empowered retail investors, the combined force of which now matches institutions when it comes to buying power and volume. The GameStop affair has also caused a lasting shift in the analysis conducted by institutions. This was due to the intense strain put on the infrastructure of brokerages and trading apps, many of which received unprecedented volumes of trades and new sign ups. For example during the frenzy, some brokerages suspended trading of certain stocks, and the frenzy even caused outages of entire apps. The GameStop scenario tells us that, yes, it does. Before you dive in and invest, look into the stock yourself and weigh up the risks involved.ĭoes Reddit matter to ordinary investors? You can find out what people are talking about and read their research to find out why the stock is trending. You can do this with the “hot”, “new” and “top” buttons above the posts and choose a time period to sort by. If you’re looking for specific categories, like dividend stocks, you can search for other subreddits. Some examples are r/WallStreetBets, r/Stocks, r/Investing and r/PennyStocks. We’ve compiled some of the trending Reddit stocks above to give you some inspiration, but if you’d like to take a look at Reddit yourself, here’s how you can find trending stocks on Reddit: A boom of coverage of the now infamous subreddit r/WallStreetBets made sure the frenzy continued through January. Long story short, Reddit investors found an opportunity to make some money by aggressively buying GameStop shares, which resulted in an internet pile on, with everyone from Elon Musk to Wolf of Wall Street’s Jordan Belfort wading into the debate and hype. In simple terms, short-selling is a bet that the company will fail, with infinite loss potential. GameStop became the subject of what’s known as ‘short selling’, a process in which professional investors borrow shares of stock to sell them and then buy them back at a later date, allowing them to make a profit if the stock price goes down. The stock became a piece in a rather complicated financial power struggle between a major hedge fund, Melvin Capital, and a group of internet investors who congregated on Reddit. GameStop skyrocketed around 8,000% over six months. This was because GameStop, a US-based video game retailer, spiked over 700% during a frenzied few days at the end of January. Why does Reddit have any impact on the stock market?Īt the start of 2021, Reddit cemented itself as a key trading indicator for many seasoned and institutional investors around the world. To generate this list, we’ve aggregated trending stock information from Reddit’s most active subs, including r/WSB, r/stocks, r/investing and r/ShortSqueeze. All international money transfer services.Notably, if short sellers were to change their sentiment and start covering their positions, it could impact the stock’s upward momentum.īuy stocks now with Interactive Brokers – the most advanced investment platformĭisclaimer: The content on this site should not be considered investment advice. One of the reasons behind the surge is the company’s better-than-expected financial report for Q2 2023, which reignited interest among retail traders.Īs Carvana’s stock enjoys a robust rally fueled by the current short squeeze, it’s crucial to acknowledge the looming downside risks, notably the mounting short interest. Year-to-date, CVNA is up more than 683%, as noted earlier, adding $6.2 billion in market cap over that period. Over the past week, the retailer’s share price rallied by more than 49% and over 70% on a monthly chart. Source: Ape Wisdom Carvana stock analysisĪt press time, shares of Carvana were standing at $37.68, down 3.1% on the day. To be more specific, Carvana is the 7th most-trending stock on Reddit in the past 24 hours, behind Nvidia (NASDAQ: NVDA), Rivian (NASDAQ: RIVN), and Tesla (NASDAQ: TSLA) among others, according to sentiment tracking website Ape Wisdom. The ongoing short squeeze in CVNA may be due to the fact that the car retailer is one of the most discussed stocks on Reddit communities, including WallStreetBets – the forum behind the 2021 meme-stock craze. Carvana among most-discussed stocks on Reddit This means that approximately 50% of the freely tradable shares, known as the float, of Carvana’s stock have been sold short by investors. In fact, CVNA is one of the most shorted stocks at the time of writing, with nearly 50% of the stock’s float being shorted, according to MarketWatch data. The short squeeze in Carvana’s case indicates that there was a significant level of short interest in the stock, as short sellers scrambled to close their positions amid the rally, further fueling the upward momentum.
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