Wall Street: Short selling and short squeezes explained
In most cases, profits are made in the stock market as the price of a share rises. But short sellers can make money as value drops and lose money as it rises.
LOS ANGELES – A 10-year-old San Antonio boy made a killing by selling GameStop stock he was gifted more than a year ago.
Jaydyn Carr’s mother, Nina, spent $60 for 10 shares of the video game chain’s stock in December of 2019 that she gave him for Kwanzaa to reflect Ujamaa, one of the festival’s seven principles that focuses on cooperative economics.
With GameStop’s share price skyrocketing this week behind a speculative frenzy driven by a Reddit chat group, Jaydyn sold the shares Wednesday for a little less than $3,200, the San Antonio Express-News reported.
GameStop stocks soar
Trading volume has surged in shares of GameStop, AMC Entertainment, as well as Bed Bath & Beyond and BlackBerry, stunning Wall Street firms betting that those stocks would fall.
“My phone was going off, because I have GameStop on my watch list,” Nina said of watching the share price surge. “I was trying to explain to him that this was unusual. I asked him ‘Do you want to stay or sell?’”
The mother-son investing duo said $2,200 of the funds would go to Jaydyn’s savings account and that they’d put the other $1,000 toward future investing.
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