Living in a Post-GameStop World
Feb 1, 2021
By: Frank Kaberna
The rivalry between Wall Street and Main Street has inspired everything from works of art to public protests, and the 2021 version of this age-old dichotomy is…(adjusts glasses)...the stock price of a video game retailer?
Recent activity in stocks like GME and AMC has driven many new voices to ring out in the financial markets, which, in turn, has created great volatility and potential opportunity for the everyday trader. This opportunity, as many saw last week, comes with fine print:
Single Stocks Can Really Move
At the close of January 28th, GameStop stock was up more than 900% on the year, and this day alone saw the stock both increase by 47% and fall by 68% from the prior day’s close. One share of GME covered a high-to-low range of more than $400 in last Thursday’s trading alone. Small Stocks (SM75) futures, a product that’s more than 30 times the size of a GME share but holds several stocks across multiple sectors, had a $170 high-to-low range on the same day.
Halts and Restrictions
Movement like this, which is more common for a single stock than a diversified stock ETF or future, can cause trade stoppages. As was seen numerous times throughout last week, a stock can trigger a halt after moving many percentages in a short amount of time. Also, many brokerages reserve the right to restrict trading in certain stocks for...their reasons. Finally, pattern day trading rules restrict day trading in accounts under the size of $25,000; this prohibits traders from opening and closing stock positions on the same day.
The opinion of the everyday trader is of paramount importance at the Small Exchange, and we are constantly working to help that trader bring their ideas to execution. Please send any feedback or questions you have for the Small Exchange to firstname.lastname@example.org.
Stock and Stock Index (GameStop \ GME and Small Stocks \ SM75)
Source: dxFeed Index Services (https://indexit.dxfeed.com) times in CT (gaps in GME due to halted periods)
Follow us on Twitter: https://twitter.com/small_exchange
Subscribe to our YouTube Channel: https://www.youtube.com/channel/UC5pAsul3H_7FYuPmZscClrA
Save Every Time You Trade the Smalls
The Small Exchange has also created a limited number of subscriptions for a one-time payment of $100 that give traders a lifetime of reduced exchange and market data fees when trading the Smalls.
For more information on the Small Exchange’s products and subscription service, visit smallexchange.com. And be sure to check out my new show on tastytrade, Small Stakes, where Pete Mulmat and I will show viewers how to navigate Small Exchange products every Monday-Friday and always on demand.
© 2021 Small Exchange, Inc. All rights reserved. Small Exchange, Inc. is a Designated Contract Market registered with the U.S. Commodity Futures Trading Commission. The information in this advertisement is current as of the date noted, is for informational purposes only, and does not contend to address the financial objectives, situation, or specific needs of any individual investor. Trading futures involves the risk of loss, including the possibility of loss greater than your initial investment.
Options involve risk and are not suitable for all investors. Please read Characteristics and Risks of Standardized Options before deciding to invest in options.
tastytrade content is provided solely by tastytrade, Inc. (“tastytrade”) and is for informational and educational purposes only. It is not, nor is it intended to be, trading or investment advice or a recommendation that any security, futures contract, transaction or investment strategy is suitable for any person. Trading securities can involve high risk and the loss of any funds invested. tastytrade, through its content, financial programming or otherwise, does not provide investment or financial advice or make investment recommendations. Investment information provided may not be appropriate for all investors, and is provided without respect to individual investor financial sophistication, financial situation, investing time horizon or risk tolerance. tastytrade is not in the business of transacting securities trades, nor does it direct client commodity accounts or give commodity trading advice tailored to any particular client’s situation or investment objectives. Supporting documentation for any claims (including claims made on behalf of options programs), comparison, statistics, or other technical data, if applicable, will be supplied upon request. tastytrade is not a licensed financial advisor, registered investment advisor, or a registered broker-dealer. Options, futures and futures options are not suitable for all investors. Prior to trading securities products, please read the Characteristics and Risks of Standardized Options and the Risk Disclosure for Futures and Options found on tastyworks.com.
tastyworks, Inc. ("tastyworks") is a registered broker-dealer and member of FINRA, NFA and SIPC. tastyworks offers self-directed brokerage accounts to its customers. tastyworks does not give financial or trading advice nor does it make investment recommendations. You alone are responsible for making your investment and trading decisions and for evaluating the merits and risks associated with the use of tastyworks’ systems, services or products. tastyworks is a wholly owned subsidiary of tastytrade, Inc (“tastytrade”). tastytrade is a trademark/servicemark owned by tastytrade.
Quiet Foundation, Inc. (“Quiet Foundation”) is a wholly-owned subsidiary of tastytrade The information on quietfoundation.com is intended for U.S. residents only. All investing involves the risk of loss. Past performance is not a guarantee of future results. Quiet Foundation does not make suitability determinations, nor does it make investment recommendations. You alone are responsible for making your investment and trading decisions and for evaluating the merits and risks associated with the use of Quiet Foundation’s systems, services or products.
Small Exchange, Inc. is a Designated Contract Market registered with the U.S. Commodity Futures Trading Commission. The information on this site should be considered general information and not in any case as a recommendation or advice concerning investment decisions. The reader itself is responsible for the risks associated with an investment decision based on the information stated in this material in light of his or her specific circumstances. The information on this website is for informational purposes only, and does not contend to address the financial objectives, situation, or specific needs of any individual investor. Trading in derivatives and other financial instruments involves risk, please read the Risk Disclosure Statement for Futures and Options. tastytrade is an investor in Small Exchange, Inc.