if retail investors continue to hold greater sway,
the result will likely be sharper swings for some
stocks than they would have had otherwise, if
not to GameStop’s spectacular degree.
GameStop’s wild ride is causing some
professional investors to gird for more volatility
in the market and politicians in Washington to
ask who is getting hurt. A House committee is
calling several of the GameStop saga’s players to
a hearing, titled “Game Stopped? Who wins and
losses when short sellers, social media and retail
investors collide.”
“I don’t think we’re going to see major reforms
that prevent it,” said Tony Casey, a professor of
law at the University of Chicago, of the rise of
social-media-driven trading. “All the parts in this
will still be here in a few years, and we will likely
see versions of it.”
Exhibit A may have come even sooner than
many expected. Just last week, stocks of several
pot producers burst higher, with medical-
marijuana grower Tilray more than doubling in
three days, only to more than halve in the next
two. Some of the surge was due to actual news,
including a Tilray deal to distribute medical
cannabis into the United Kingdom. But smaller
investors also piled into the stocks.
“Time to get on the cannabis bandwagon if you
ain’t,” one user posted on the WallStreetBets
forum of Reddit, a hub for smaller investors and
perhaps the launch pad for the GameStop saga.
The cannabis trading does, however, lack
one key element of the GameStop drama: It’s
decidedly not about sending a message to
hedge funds. It’s more about the thrill of making
bold trades that may explode in a good or bad