A post on the Reddit’s r/WallStreetBets forum that argued GameStop Corp. (NYSE:GME), AMC Entertainment Holdings Inc. (NYSE:AMC) and Clover Health Investments Corp. (NASDAQ:CLOV) are three “completely different plays” found extreme popularity.
What Happened: A user with the handle u/ShortChecker on the WSB forum — which has 10.6 million members and is known for short squeezes — noted that videogame retailer GameStop emerged as a favorite of retail investors in late December/early January this year as it had an unprecedented short interest of 140%.
GameStop is still the play to this day because the remaining, about 15% to 20%, short sellers still holding their positions are the same ones from the beginning who have accumulated billions in losses, according to the post.
The post added that movie theatre chain AMC Entertainment is still a very big play as the company has pivoted to reconstruct its business model to become a success once the pandemic ends.
Medical insurance technology company Clover Health was “ridiculously shorted” ever since its IPO and this had nothing to do with GameStop or AMC Entertainment, according to the post. The firms shorting Clover Health are not the same ones as those who shorted GameStop and AMC Entertainment, the post noted.
Why It Matters: The post dubbed WallStreetBets a casino, and said there was a place for supporters of stocks beyond GameStop and AMC to participate in the discussions. They are not the same play, stop comparing the [three,] u/ShortCheker said in the post that had over 10,300 upvotes as of press time.
The post has attracted about 1,500 comments, with several users on the forum, in agreement, saying they plan to buy more shares in the three companies.
Clover Health is seeing higher interest than both fellow Reddit favorites GameStop and AMC Entertainment on the WSB forum. The company is the most shorted stock – attracting the short interest of 36.7%, according to High Short Interest Stocks, a website that tracks stocks with short interest of over 20%.
Price Action: GameStop shares closed 1.6% lower in Tuesday’s trading session at $199.56, while AMC Entertainment shares closed almost 3.9% lower at $49.96.
Clover Health shares closed 14.6% lower in Tuesday’s trading session at $10.00.
Photo by The Focal Project on Flickr
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