GME jumps into ‘roaring kitten’ for traders, sparking meme craze again | Wilnesh News

game station “Roaring Kitty,” the stock that sparked 2021’s epic short squeeze, was up more than 37% in premarket Monday after being posted online for the first time in about three years.

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Roaring Kitty, whose legal name is Keith Gill, was a marketer for the Massachusetts Mutual Life Insurance Company. Gill, who goes by DeepF——Value on Reddit, attracted a group of day traders who cheered each other on and piled into physical video game stocks and call options in 2020 and 2021.

Hedge fund Melvin Capital was heavily shorted against GameStop, became the target of an army of amateur traders, and suffered huge losses, prompting Citadel’s hedge fund arm as well as Point72 to inject nearly $3 billion into Melvin to shore up its finances.

The jaw-dropping frenzy at one point forced brokerages including Robinhood to restrict trading in heavily shorted stocks as it caused clearinghouse margins to rise sharply. A Robinhood user filed a class-action lawsuit after the app decided to restrict GameStop from trading on its platform. Robinhood won the dismissal of the lawsuit in August 2023.

There is another class action lawsuit filed against Gill, alleging that he impersonated a novice trader despite being a licensed professional.

The volatility also spawned a series of congressional hearings surrounding brokerage practices and gamified retail trading, including leaders from Robinhood, Melvin Capital, Reddit, Citadel and Gill. This history-making episode inspired the 2023 film “Silly Money,” in which Paul Dano plays Gil.

In January 2021, the stock price hit an all-time intraday high of $120.75 per share, adjusted for stock splits. GameStop announced a 4-for-1 stock split in July 2022. The stock hit a three-year low of $9.95 last month.

Recently, the stock has started moving higher again, which may have reignited trader interest. The stock has gained 57% so far in May, closing at $17.46 on Friday.

However, GameStop’s recent earnings report revealed a dismal picture for the video game company. In late March, the company said it had cut an unspecified number of jobs to reduce costs and reported a decline in fourth-quarter revenue amid growing competition from e-commerce companies.

GameStop reported fourth-quarter revenue of $1.79 billion, compared with $2.23 billion in the same period last year.