2021 GameStop (GME) stock surge
Write an essay (2000-2500 words) to explain GameStop stock surge.
Below is a drafted
logic chain. You can choose to follow it, but you are very welcome
to create your own
by rearranging the order and/or enriching it. [35 marks]
1) What happened on GME stock on 28th of January?
2) What is short sell?
3) Who are the main institutional investors short selling
GME?
4) Why did they short sell on GME? What is short over float?
5) How big were their loss?
6) Can you find a GME price trend chart from online? How does it
look like? Please
attach it in your essay.
7) How does marking to market apply to short selling?
8) Why do institutional investors rather than retail investors
short sell?
9) Is short selling associated with a high leverage? Why is it so
risky?
10) Does short selling contribute to market efficiency and
stability? Why?
11) What is short squeeze?
12) Did retail investors short squeeze using stock only? Or using
call options as well?
13) What is gamma squeeze?
14) Does market maker hold positive gamma or negative gamma?
Why?
15) Why does liquidity play an important role in this case?
16) What are the risk management strategies that short sellers
usually take? Do those
strategies work or not in this case?
17) Do you think that the retail investors beat the institutional
investors in this case? Or
the long-side institutional investors beat the short-side
institutional investors, and
the long-side institutional investors are just covered by the
retail investors? Why?
Any Evidence to support your argument?
18) Do you think it is still correct to define retail investors as
noise trader nowadays
with internet and media outlets?
19) What are the lessons to learn from security regulation
perspective?
2021 GameStop (GME) stock surge Write an essay (2000-2500 words) to explain GameStop stock surge. Below is a drafted log
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