Following last month’s surge in the share price of GameStop Corp (NYSE:GME), the global market was finally exposed wholesale to the power that retail investors can wield if they are coordinated enough and have access to trading apps.
The incident also unearthed the Reddit forum of r/wallstreetbets (WSB), which describes itself as if infamous forum 4chan “found a Bloomberg terminal”, as well as a litany of new phrases and internet memes that left many in the financial and the wider world stumped as to what exactly was going on or who was causing it.
With the rise of WSB as the latest conduit for information on what retail investors (or at least 9mln of them) are thinking, analysts may need to understand the key terminology that characterises the culture of these self-dubbed ‘Degenerates’.
Diamond hands/Paper hands
Starting with one of the more frequent phrases to be used during the GameStop trading frenzy, a trader having ‘Diamond hands’ means they are prepared to hold onto a stock or security for an extended period, usually due to the belief that they will ultimately profit from their position despite any fluctuations along the way to selling.
By contrast, having Paper hands denotes a trader that, in the eyes of the community at least, sells their stocks prematurely before maximum profit can be obtained. Investors such as these may also be called ‘Weak hands’, a more self-explanatory term.
To the Moon
Another term that began making the rounds in the mainstream during the GameStop affair, ‘To the Moon’ occurs when users see a stock or security will witness a dramatic gain in value, similar to that of a rocket launching into space (to subsequently reach the Moon, assumedly).
A stock soaring may be designated using other space travel-related terms such as Andromeda, the galaxy neighbouring the Milky Way, or simply images of a launching rocket.
Moving onto some acronyms, ‘DD’ on WSB can, perhaps confusingly, refer to two different terms, ‘double down’ or ‘due diligence’.
Doubling down refers to, surprisingly, throwing even more money into a stock or position, usually if it has begun to show promise as a bet or has the potential to increase in value.
Due diligence, meanwhile, is also relatively self-evident, referring to researching a stock or topic in closer detail. Posts labelled as DD’s on the forum tend to have much more information to back up their opinion on certain stocks or bets rather than simply riding existing momentum.
A nickname for the current Federal Reserve chair Jerome Powell, who aside from being one of the biggest players in the global economy also moonlights as the main character of the popular “money printer go brrrr” meme.
The meme, which represents the Fed printing money to prop up bond markets to prevent an economic downturn much to the chagrin of a bowtied anarcho-capitalist (or ancap for short), originated during March 2020 in the early days of the economic crisis caused by the pandemic and has since spread as a format to encompass a wide variety of situations.
However, JPOW himself appears to be the only central banker to receive a meme makeover to date (although getting the Bank of England governor renamed as ABAIL could be an interesting next move).
As you may expect from a group that identifies themselves as degenerates, some of the terms can be less than cordial.
One such example is ‘Buy The Fucking Dip’ (BTFD), which encourages traders to buy into a stock when it has declined in price but is expected to bounce back at a later date.
From acronyms to an onomatopoeia, ‘GUH’ refers to the sound of a soul leaving the body, in this context when a trader suffers a huge loss on a trade.
The term originates from WSB user u/ControlTheNarrative, who exclaimed the phrase after suffering a US$45,000 loss mere minutes after the market opened.
Another one of the more popular terms during the GameStop incident, ‘Tendies’ refer to gains on an investment or stock.
The term, derived from the fried chicken tenders of the same name, originates from online text stories, usually on 4chan, which feature a man in his 20s who lives with his parents and constantly demands "tendies" in exchange for "good boy points" he has earned by doing chores and taking care of himself.
WSB users also tend to use the term “collect my tendies” to indicate when they will cash out of a stock.
Those going for a large ‘Tendies’ payoff may also decide to make a ‘you only live once’ (YOLO) bet.
This usually involves a WSB trader risking a large portion, or even their entire portfolio on a single stock or option.
GameStop was one such YOLO stock to attract the forum’s attention, one that has resulted in handsome ‘Tendies’ for some of its more famous users such as YouTuber Keith Gill, better known as Roaring Kitty, who invested US$53,000 in GameStop in 2019, the value of which has since ballooned to around US$48mln as of the end of January.
Perhaps the most popular term to hit the mainstream during the GameStop frenzy, the term ‘stonks’ is not the child of WSB but rather the more general online meme community.
Usually featuring a bald animated figure dressed in a business suit staring towards nothing, the meme is a deliberate misspelling and is often used ironically when an individual or entity makes a decision that results in a large financial loss.
Since its inception, the stonks meme has also been used in other situations, but with the misspelt word replaced with different nouns. Prominent examples include ‘helth’ to refer to unusual or counterproductive strategies to repair injuries, and ‘hac’ in situations involving humorous, and often pointless, tampering with technology.