During January 2021, there was a spectacular run up in the price of the stock of GameStop (Ticker symbol: GME). The price rose from $18.84 per share at the end of December to $325.00 per share at the end of January. Most of the discussion about GameStop has been about the relative power of individual investors and Wall Street hedge funds. While this is an important debate, at FiCycle, we want to dip deeper into determining the value of the stock to a long-term investor and 'Do the Math.'
Risks Associated With ‘Hot Stocks’:
There are significant risks when short-term trading based on social media. The SEC and FINRA have each issued a notice outlining the risks.