The highly anticipated SEC report attributed the episode primarily to a rapid increase in trading by individual investors, many of whom used social-media platforms like Reddit to swap ideas and strategies. The agency poured cold water on a number of alternative hypotheses for why the struggling videogame retailer’s share price soared from less than $20 at the end of 2020 to an intraday high of $483 on Jan. 28.
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SEC’s GameStop report questions ‘game-like’ trading apps
“Consideration should be given to whether game-like features and celebratory animations that are likely intended to create positive feedback from trading lead investors to trade more than they would otherwise,” the SEC said in Monday’s report.
