Investing madness

I’ve always been told that retail investors really do not move the needle when it comes to stock prices. Institutions have the most money and therefore have the most control when it comes to the market. It’s been a largely accepted truth in the stock market and it makes sense.

For better or worse, that’s completely all out the window at this point. The new age of retail investors using free-trading apps such as Robinhood most definitely move the needle. If there was any doubt to that statement, then this past week should be the icing on the cake.

A subreddit quite literally drove the stock price of Gamestop up nearly 50% this past week. Citron Research announced that they were shorting Gamestop and the subreddit r/wallstreetbets went to action forcing trading to be halted on the stock at one point on Friday.

I’m not sure what to make of this madness. I’m enjoying watching from the sidelines as the thought that a bunch of people on free trading apps are crushing institutional investors is quite funny. More power to the people I suppose.

I’ll be picking my battles carefully over the next few months. Things are frothy to say the least and there’s still a global pandemic going on. I’m not sure how long this market craze will last, but I’m also not going to be the person to try to bet against it.