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The role of Reddit in the GameStop short squeeze

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  • Anand, Abhinav
  • Pathak, Jalaj

Abstract

We present evidence that the tone of r/wallstreetbets (WSB) discussions displayed significant predictive associations with intraday GameStop variables and that the comment distribution obeyed a power law and in fact it was 462 users whose posts most impacted GME.

Suggested Citation

  • Anand, Abhinav & Pathak, Jalaj, 2022. "The role of Reddit in the GameStop short squeeze," Economics Letters, Elsevier, vol. 211(C).
    • Handle: RePEc:eee:ecolet:v:211:y:2022:i:c:s0165176521004808
    DOI: 10.1016/j.econlet.2021.110249
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    References listed on IDEAS

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    1. Del Gaudio, Belinda L. & Megaravalli, Amith V. & Sampagnaro, Gabriele & Verdoliva, Vincenzo, 2020. "Mandatory disclosure tone and bank risk-taking: Evidence from Europe," Economics Letters, Elsevier, vol. 186(C).
    2. Torben G. Andersen & Tim Bollerslev & Francis X. Diebold, 2007. "Roughing It Up: Including Jump Components in the Measurement, Modeling, and Forecasting of Return Volatility," The Review of Economics and Statistics, MIT Press, vol. 89(4), pages 701-720, November.
    3. Marinč, Matej & Massoud, Nadia & Ichev, Riste & Valentinčič, Aljoša, 2021. "Presidential candidates linguistic tone: The impact on the financial markets," Economics Letters, Elsevier, vol. 204(C).
    4. Petra Kralj Novak & Jasmina Smailović & Borut Sluban & Igor Mozetič, 2015. "Sentiment of Emojis," PLOS ONE, Public Library of Science, vol. 10(12), pages 1-22, December.
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    Citations

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    Cited by:

    1. Georgios Fatouros & Konstantinos Metaxas & John Soldatos & Dimosthenis Kyriazis, 2024. "Can Large Language Models Beat Wall Street? Unveiling the Potential of AI in Stock Selection," Papers 2401.03737, arXiv.org, revised Apr 2024.
    2. Nobanee, Haitham & Ellili, Nejla Ould Daoud, 2023. "What do we know about meme stocks? A bibliometric and systematic review, current streams, developments, and directions for future research," International Review of Economics & Finance, Elsevier, vol. 85(C), pages 589-602.
    3. Daniel Pastorek & Michal Drabek & Peter Albrecht, 2023. "Confirmation of T+35 Failures-To-Deliver Cycles: Evidence from GameStop Corp," Czech Journal of Economics and Finance (Finance a uver), Charles University Prague, Faculty of Social Sciences, vol. 73(1), pages 56-80, January.
    4. Yousaf, Imran & Pham, Linh & Goodell, John W., 2023. "The connectedness between meme tokens, meme stocks, and other asset classes: Evidence from a quantile connectedness approach," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 82(C).

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    More about this item

    Keywords

    Short squeeze; GameStop; WallStreetBets;
    All these keywords.

    JEL classification:

    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
    • G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading
    • G40 - Financial Economics - - Behavioral Finance - - - General

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