‘Stunned’: GameStop trading frenzy causes local mining company shares to soar

A tiny West Australian mining company has been caught up in the investing craze surrounding US company GameStop thanks to its ASX code matching that of the American video game retailer.

GME Resources, which is listed on the local bourse with a market capitalisation of just $40 million, is a mining company focused on nickel and cobalt extraction. On Thursday, its shares soared more than 50 per cent to 12 cents, their highest level since 2018, with volumes of nearly $7 million.

A local company that shares an ASX ticker with US retailer Gamestop has seen its shares surge 50 per cent.Credit:Bloomberg

However, the skyrocketing price had nothing to do with the business’ quarterly update released last Friday nor the rising price of nickel. Instead, local participants of share trading groups on Reddit and Facebook had bought the stock as a joke due to its ticker’s similarity to popular US stock GameStop.

Shares in the overseas video game retailers have rocketed over 1500 per cent in the past month to nearly $US350 ($457) thanks to day traders on the Reddit forum Wallstreetbets continuing to promote the stock and other heavily short-sold companies in perceived revenge against major US hedge funds.

This content was originally published here.