After losing 39% on Monday,was sharply trending lower on Tuesday, losing around 40% around 6 p.m. Swiss time. After hitting a high at 483 dollars last Thursday, the title of the American video game seller, backed by the “army of Reddit potters,” briefly passed below $ 100 on Tuesday, before rebounding.
Several new theories have emerged, tarnishing the idea of a revenge of the small investors over the big ones. For famed short seller Carson Block, for example, the “Reddit army” is just a smokescreen behind a hedge fund settlement, he told Bloomberg on Tuesday. Known for attacking Chinese listed companies which he considers to be fraud, the investor believes that they are mainly hedge funds wanting to attack others by creating the “short squeeze”.
He defends this point of view all the more because he says he himself was the victim of hedge funds when he short-sold GSX Techedu in the weeks preceding the GameStop affair.
Potential already identified
Another defended theory, the one that Michael Burry, famous for having bet on the fall of subprime, would have already seen the potential of the action a long time ago. According to Washington post, he allegedly wrote a letter to GameStop officials eighteen months ago asking them to act “immediately” to reverse their decline, which was going to accelerate. He, who held $ 2 million in shares, encouraged them to use their cash reserves to buy back shares. What they did not do. But for the Washington daily, it was a sign that on Wall Street some had already seen a potential in this action.