The recent surge in GameStop Corp. stock has reignited the meme-stock phenomenon, prompting one of its most vocal critics, Andrew Left of Citron Research, to re-enter the fray with a new short position. This move comes after a notable increase in GameStop’s stock price, driven by Keith Gill, an investor and meme stock influencer known as “DeepF—ing Value” on Reddit, who revealed a significant stake in the company.
Andrew Left, who faced substantial losses during the initial meme-stock craze in 2021, has once again taken a bearish stance on GameStop. After covering his short position in May, Left re-shorted the stock on Monday. While he did not disclose the size of his current position, he noted that it is smaller than his previous one.
GameStop’s stock soared by as much as 75% at the start of trading on Monday, adding approximately $6 billion to its market capitalization and triggering a trading halt due to volatility. Despite paring back some of these gains, the stock remained up over 30% in early afternoon trading. However, it is still far below its peak closing price of $86.88 on January 27, 2021.
Meme stocks have once again captured the attention of the market, largely due to the reappearance of Keith Gill, also known as “Roaring Kitty“, on social media platform X (formerly Twitter). In 2021, Gill gained fame for his role inrallying retail traders on Reddit, sparking the original meme-stock craze. Gill’s June 2 post fueled the latest trading frenzy in GameStop shares, underscoring his continued influence in the retail trading community.
Despite his past losses, Andrew Left has re-engaged with short selling, albeit with a more cautious approach. In an interview with Bloomberg, Left stated, “I covered my short from May, and then I re-shorted it today.” He added that he harbours no ill will towards GameStop, describing it as more of a trading vehicle than a company.
Left’s previous experience in the meme-stock saga was challenging, with Citron Research suffering significant losses due to a bearish bet on GameStop. His firm also became the focus of a U.S. Justice Department investigation into short selling by hedge funds and research firms. In early 2021, Left announced that Citron Research would cease publishing short-selling research, ending a practice that had lasted for two decades. However, he has since resumed writing such reports, though less frequently.
The latest developments in GameStop’s stock highlight the persistent volatility and fascination surrounding meme stocks. Andrew Left’s return to short selling signals that, despite past setbacks, critics of the meme-stock movement remain active. As retail investors continue to exert influence through social media, the dynamics of the stock market are poised to remain unpredictable. It’s unclear whether GameStop will sustain its current momentum or undergo another significant change, but it’s evident that the story of meme stocks is far from concluded.