‘Weaponised’ options trading turbocharges GameStop’s dizzying rally
GameStop is only the most visible example of today’s options-fuelled stock market mania. While the increasing use of derivatives has been a hallmark of previous retail trading frenzies, the current popularity is alarming even seasoned observers.
GameStop’s rocket-fuelled trading this month, which has taken the stock’s gain in 2021 to almost 1800 per cent, is a vivid example of how a new army of day traders have “weaponised” financial derivatives to their advantage.
The game retailer’s stock had catapulted 135 per cent by midday trading in New York on Wednesday, to $US353, extending a recent spree of gains that sent it zooming higher from its 2020 closing price below $US19 a share.
Financial Times
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