I invest a little (very little) from each check in stocks on Robinhood/stash and a lady at my job made a ton with gamestock. Why is there so much outrage if a bunch of ppl buy a stock? I have like five thousand dogecoins and I see that has doubled in price.
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Some hedge fund gambled that the stock would lose value, as they borrowed the stock then sold it. They have to give it back within a set time. WSB finds out, and artificially inflates the value of the stock by having many people buy it at once. The hedge fund now has to buy back the stock and give it back to the owner, losing billions, which has drained their finances.
Simply put, they took a gamble, lost because of WSB, and don't have the money to pay back the stock.
And this is behavior that Wall Street firms pull every chance they get. If they find out another firm is up a creek on a particular trade, word spreads like wildfire and everyone bets against them. But when the little guys do it? Oh no, no, no.