But by making a big bet against the beloved brand, Citron drew the ire of Redditors, who snapped up GameStop shares in retaliation. Citron bet on the price of the stock going down, known as short selling. Part of the trigger for piling into GameStop was a report by Citron Research, which claimed that, at $40 dollars, the company was massively overpriced.
#HOLD THE LINE GAMESTOP PLUS#
The mixture of frenetic energy given off by WSB users, encouraging each other to "BUY BUY BUY!" and "Hold the Line" on specific stocks, plus the outrageous success stories, contribute to the mob mentality. DFV's investment is now worth $47 million, according to an investment account screenshot the user posted on Reddit. Visitors to WallStreetBets are treated to incredible success stories from users like DeepF**kingValue, who bet $53,000 (€44,000) on a rising GameStop stock price back in summer 2019. On WallStreetBets, heretics are shot down while big winners get pride of place at the top of the page. The social media platform allows users to upvote and downvote each others' posts. Redditors have whipped each other up into a frenzy, aided by the mechanics of the site itself. "And because the investing is entirely online, the 'revolt' becomes self-fulfilling." Redditors in a frenzy "The dynamics of social media increase the power of this illusion," Liu said. The mob mentality creates an illusion of size and power in the minds of participants, while allowing the individuals to underestimate the consequences of being caught out. "Events like this resemble riot dynamics, where one is more likely to take a risky action - such as joining a mob or crowd like those on Reddit - if she or he sees that many others have already joined," Chengwei Liu, associate professor of Behavioral Science at ESMT Berlin, told DW. The rush represents some troubling psychological dynamics among investors, with many caught up in a herd mentality that could see them left massively out of pocket, or even pursued by regulators, when the party ends. Users on Reddit's WallStreetBets page are throwing their money at maligned stocks like GameStop and Blackberry, partly out of spite against hedge funds betting against the firms.
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