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Redditors Who Targeted GameStop Send Silver Price To Eight-Year Highs

by : Julia Banim on :
Redditors Who Targeted GameStop Send Silver Price To Eight-Year HighsPA Images/Pixabay

Redditors who targeted GameStop have sent the price of silver up to an eight-year high, with spot silver going up by as much as 12% to $30.17 an ounce – the highest its been since February 2013.

There have been various mentions of the hashtag #silversqueeze on the Reddit thread r/wallstreetbets, with users encouraging each other to purchase silver. This has ultimately resulted in an escalation in the value of the precious metal.

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The new surge was reportedly partly due to the belief that raising the physical price of silver could hurt large investors who had made paper bets that the price of silver would drop.

silverPixabay

Silver-mining stocks and coin-selling websites were reportedly flooded by small-time investors on Monday, February 1, who were rushing to purchase the metal.

Spot silver has now reached its highest price since August 11, currently priced at $28.98 an ounce, The Guardian reports. Silver-mining stocks have risen by more than 15%, while the demand for physical silver has more than doubled since Thursday, January 28.

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Silver exchange traded funds listed on the Tokyo stock exchange have seen a hike of more than 10%. Shares of Australian silver explorers also rose between 20% and 40% on Monday, February 1.

Data from iShares Silver Trust ETF on Friday, January 29, revealed more than 37 million shares, each one representing an ounce of silver, had been created in the space of just one day.

GameStopPA Images

This is the latest asset to surge after Redditors drove up the share price of gaming and electronics store GameStop, going against bets made against it by big hedge fund managers.

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Kyle Rodda, Melbourne based analyst at brokerage IG Markets, told The Guardian:

The Reddit crowd has turned its sights on a bigger whale in terms of trying to catalyse something of a short squeeze in the silver market. This is their big, bold Moby Dick moment.

However, as Hussein Sayed, chief market strategist at FXTM explained, influencing the price of silver won’t be as simple as it was with the GameStop frenzy.

Sayed told BBC News:

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Silver’s market cap is in the range of $1.4 trillion to $1.6 trillion as opposed to GameStop’s $1.5 billion before becoming the target of retail investors and a large proportion of the market is off-exchange.

[…] Retail traders who are just following the herd and join the party late may accumulate huge losses and need to be more rational in their decisions.

RobinhoodPA Images
News

Reddit Traders Celebrate As Hedge Fund That Shorted GameStop Forced To Shut Down

published ata year ago

The recent GameStop frenzy, fuelled by amateur investors, was regarded as a rebellious revolt against Wall Street giants.

However, this new surge is being viewed differently by some, with a number of Reddit users having alleged that ‘the Silver Squeeze’ has in fact been secretly coordinated by major Wall Street firms.

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While GameStop had been operating at a loss, with many investment funds having chosen to bet against it, silver has seen strong growth over the course of the past year, meaning the two cases are actually quite different.

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Julia Banim

Jules studied English Literature with Creative Writing at Lancaster University before earning her masters in International Relations at Leiden University in The Netherlands (Hoi!). She then trained as a journalist through News Associates in Manchester. Jules has previously worked as a mental health blogger, copywriter and freelancer for various publications.

Topics: Life, GameStop, Reddit

Credits

The Guardian and 1 other
  1. The Guardian

    Redditors set their sights on silver after GameStop frenzy

  2. BBC News

    Silver surges as Reddit army turns to commodities