"GameStop" War

    In January, some hedge funds shorted GameStop (NASDAQ: GME) stock, betting that the share price would continue to fall, and a stake equivalent to 140% of GameStop's total share was shorted. However, due to the high stock price of Game Station and the reluctance of the holders to sell, the short side could not obtain enough shares to fulfill their option contract, and had to rush to make up the position. Instead, the stock price continued to rise, resulting short squeeze. The stock price of Game Station has soared nearly 190 times from the historical low due to the short squeeze, approaching $500 on January 28, 2021, causing huge losses to the bears. The short squeeze was mostly triggered by users of the wallstreetbets discussion board on Reddit and other online trading forums via free trading apps like Robinhood. The ongoing short squeeze on the New York Stock Exchange, Nasdaq and other stock exchanges with many other securities has resulted in significant financial consequences on some hedge funds.

    Another explanation for the incident is that during the COVID-19 pandemic, most consumers are staying home and shopping less. With record low interest rates and a lack of other consumption or investment options, retail investors also have more money in their hands, creating a culture of betting heavily on the stock market to make easy money;