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Today's big stories

Silver hit an eight-year high as retail investors drove up its price
It might be easier to spot GameStop-like stocks if you know the more accurate reason behind the company’s surge – Read Now
January saw a record amount of money raised in stock market debuts

Extra-ore-dinary Scenes

What’s Going On Here?

Reddit-inspired retail investors were back at it on Monday, this time pushing silver’s price to an eight-year high.

What Does This Mean?

Investors piled almost $1 billion into the biggest exchange-traded fund (ETF) that tracks the price of silver last Friday (tweet this). That surge in demand made it one of retail investors’ most-traded assets that day, and gave the commodity’s price its biggest one-day gain in thirteen years.

The timing is significant: silver's been a hot topic on Reddit’s r/WallStreetBets – the forum where GameStop and AMC’s stocks caught fire – as retail investors try to carry out a similar “short squeeze”. The aforementioned ETF is, after all, backed by physical silver, meaning the fund provider is forced to buy the metal when it receives new investments. And if there isn’t enough to go around, its price could be “squeezed” higher and higher and higher…

Why Should I Care?

Zooming in: This isn’t just GameStop 2.0.
This situation is similar to last week’s GameStop saga, but it’s different in a couple of key ways. Firstly, GameStop’s market value is much smaller – $1.4 billion to silver’s $32 billion – and as such easier for retail investors to influence. And secondly, institutional investors don’t seem to be betting against the metal like they were against GameStop. In fact, they’ve been optimistic about its chances: data shows they have, in aggregate, invested in the metal, and Goldman Sachs recommended buying the asset last year.

The bigger picture: The tail might finally be wagging the dog.
Still, the fact silver’s price moved higher in such a significant way – especially considering how much more the market is worth than GameStop – shows the momentum retail investors are now having. It might only be a matter of time before institutional investors start following their lead in an effort to profit from the waves their smaller counterparts are making – if they’re not already.

You might also like: Why would you want to invest in commodities anyway?

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2. Analyst Take

The Hidden Catalyst Behind GameStop’s Surge

What’s Going On Here?

GameStop is the talk of the town, so you might think you’ve heard all there is to hear about the retailer whose stock has risen more than 1,500% this year.

Not quite.

Sure, it’s no secret that its rise was driven by a “short squeeze” – when a rising stock price forces those who’d sold it short to cut their losses and buy back in, driving the price even higher.

But there’s good reason to think a “gamma squeeze” – when a high number of open options contracts forces yet more buying of the underlying stock – might’ve played a bigger role.

That’s important, because if you know the signs of a gamma squeeze, you might see it crop up in other popular stocks.

So that’s today’s Insight: what exactly a gamma squeeze is, and how you can learn to spot one elsewhere.

Read or listen to the Insight here

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New Release

What’s Going On Here?

January saw companies raise a record amount of money in their stock market debuts, and February’s looking promising too.

What Does This Mean?

Over 200 new stocks hit the market in January, and those initial public offerings (IPOs) were worth a combined $49 billion – up from $12 billion the same time the year before. And there are no signs the rush is slowing down. For one thing, demand’s still sky-high: the five biggest American IPOs this year raised more money than the companies were aiming for, while two of Europe’s biggest saw enough orders for every one of the firms’ new shares within 90 minutes. And for another thing, companies are accelerating their plans to go public so they can profit from high stock market prices...

Why Should I Care?

Zooming in: IPOs are on a high.
Four companies announced they’d be joining the UK stock market on Monday, which should come as welcome news to a European IPO market that lagged behind both the US and Asia last year. One of them is Australian firm MGC pharmaceuticals – the first medical cannabis company to list on the London Stock Exchange since UK regulators gave the green light to do just that. MGC pharmaceuticals – which is developing weed-based epilepsy and dementia drugs – is already listed in Sydney, but it reckons coming to London will raise both its profile and around $7 billion from UK investors.

The bigger picture: This feels familiar.
Not all analysts are sold on the IPO craze: the time might be right for companies to raise money from investors, sure, but they still need a good enough reason to ask for it. Some are even comparing it to the height of the dotcom bubble, when companies were keen to get their hands on investors’ money while the going was good – and we all know how that ended…

You might also like: How to profit from stock market debuts.

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💬 Quote of the day

“Experience is the name everyone gives to their mistakes.”

– Oscar Wilde (an Irish poet and playwright)

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🏡 Knock, knock…

Who’s there? The US real estate market. The US real estate market who? No, seriously: the returns you can make from the US real estate market are no joke, and it’s not just a playground for the rich anymore. So join Caliber’s CEO on Wednesday for the scoop on why now might be the perfect time to jump in.

🚀 Future of Fintech in Latin America: 6pm UK Time, February 2nd
🏡 Crowdfunding US Real Estate: 12pm NYC Time, February 3rd
👾 Bitcoin vs Ethereum: 7pm France Time, February 5th
✌️ Dimensional Investing vs ETFs: 9pm Singapore Time, February 9th
🤖 What’s next for Crypto?: 9pm Hong Kong Time, February 11th
🙋 Developing a Framework to Invest in Women: 6pm UK Time, February 25th
🏳️‍🌈 Financial Planning for the LGBTQ Community: 2pm NYC Time, February 26th

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Finimize - 🧐 Redditors are back at it

Today's big stories

Extra-ore-dinary Scenes

What’s Going On Here?

What Does This Mean?

Why Should I Care?

The Hidden Catalyst Behind GameStop’s Surge

Treat yourself this Valentine’s Day

New Release

What’s Going On Here?

What Does This Mean?

Why Should I Care?

🏡 Knock, knock…

Older messages

😬 5G did it

📉 Tesla’s got it all wrong

🌤 Microsoft’s on cloud nine

🛁 Goldman's worried about the bubbles

Is no tech company safe?

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