Public records from the SEC revealed that chairman Ryan Cohen purchased $100,000 shares of the meme stock GME. The news of the purchase began circulating social media after market close on Tuesday, causing the price to surge 15% today, even after the 31% increase on Tuesday. Founder of the pet supply company Chewy Inc, Ryan Cohen is a key investor in GameStop. He tweeted on Tuesday night, “I put my money where my mouth is”. The chairman now has an 11.9% stake in the company.
This price jump in GameStop is an exciting one for retail investors, as this is the largest gain the stock has seen since March of 2021. At the time of writing GME is at a price of $141.52.
GME has made quite a comeback in the last ten days. The popular meme stock was trading at a low of $76.11 on March 14th, and has since reached as high as $150.93 today after the news broke. Trading volume for GameStop reached incredible volume in reaction to the news, reaching up to 14 million compared to its usual 3 million.
The news of this $100,000 share purchase by Cohen, may be just what the GME online community needed to kickstart another rally. The momentum from online forums and social media forums like reddit and twitter may accelerate the surge even further.
WHAT WILL HAPPEN TO GME SHORT POSITIONS?
Ryan Cohen, along with others like Adam Aron, Elon Musk and Jon Stewart have all been vocal about their opinion on short sellers — especially in the meme stock community like AMC and GME. Short sellers have been shorting AMC and GME, while retail investors continue to buy and hold (HODL) the popular meme stock.
GME has a high short interest of 23.87%, and while mainstream media continues to hold on to the narrative that GameStop doesn’t have the ability to short squeeze, retail investors don’t believe that to be the case at all.
If the price of GME continues to surge at an accelerated pace it could mean trouble for short sellers. Last January, GME surged to about $500 when brokerage platforms like Robinhood halted trading and removed the ability for retail investors to make trades on the meme stock.
GME has recently reported its quarterly results and the company has emphasized its digital transformation. Matt Furlong, the CEO of GameStop gives retail investors nothing but confidence in continuing to buy and hold. Furlong says,
“We invested in a dedicated blockchain team and new capabilities to drive the development of initiatives such as our NFT marketplace, which we expect to launch by the end of the second quarter. We see significant long-term potential in the more than $40 billion market for NFTs.”
Chairman Cohen has expressed that GME has plans to introduce NFT projects and start other cryptocurrency and blockchain initiatives. GME has continually made strides in perfecting their team to lead the meme stock in the right direction. Last year, former Amazon Web Services engineering lead Matt Francis was hired as the new Chief Technology Officer and Jenna Owens, former Director of Amazon Fulfillment was brought on as GME’s new Chief of Operations.