GameStop Corp (NYSE:GME) the meme stock is back.
Retail investors have made a flurry of new options trades betting that the stock will jump 50% in over a week when the video game retailer reports earnings on December 6.
A December 8 $20 call option was traded 20,000 times on Tuesday, according to reports, with the majority of those positions newly opened by traders. Others have amassed options at $22, $22.50 and even higher levels if the stock continues to climb.
The rise is already underway: GameStop’s stock has already surged nearly 30% this week to $15.31.
The option contracts essentially give their holders the right to buy or sell up to 100 shares of a stock at a particular price before a certain date.
Some 140,000 GameStop call options were traded in total on Tuesday, compared to a 20-day average of 30,000, according to reports citing Piper Sandler’s options chief.
The renewed fervor calls to mind the meme stock frenzy of early 2021, a short squeeze that saw GameStop shares soar as high as $483 per share and later became the subject of the film “Dumb Money.”
Contact Andrew Kessel at andrew.kessel@proactiveinvestors.com
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