A Quick Dive Into Stocks

By Liah Noboa 9-II

If you usually keep up with the news, you may have noticed a rise in discussions about GameStop, Reddit, stocks, and Robinhood— and no, not the fictional character, a matter much more dramatic and shocking for many people. One can view the GameStop story as only a joke, silly or even purely a force for good if it’s seen in a vacuum rather than what is: part of a broader piece of online-driven, fandom-culture filled with sarcasm, games, coded language and a whole lot of entitlement. But what is that all about? It’s somewhat confusing for different people, so let’s take a simple look at the events first.  

GameStop is a game store facing similar struggles as many others in the US, where shopping habits and the pandemic have led to a rise in consumers buying products online rather than in supermarkets. Investors on Wall Street have been strongly betting against the company for months, claiming that its economic business model is unsustainable. Not everybody agreed with this. Some members of a powerful stock market discussion forum on Reddit began urging others to invest in GameStop, arguing that the major investors had gotten it wrong and that the firm was drastically undervalued. When word of the dispute spread on social media, more customers jumped in, accelerating the company’s dramatic growth in market value. The big holders who had invested against the stock rising in value were devastated and lost billions.  

And, coming too shortly after the Capitol revolt, GameStop reflects the impact of social media. It has the power to not only rapidly spread a plausible concept, but also to effectively mobilize hundreds of thousands of people behind a course of action that has the potential to provoke political unrest and boost stock prices far beyond acceptable standards. 

This same discussion spark has led many people to be more interested in stocks, as social media users have started to share tips and tricks in order to be more likely to have net gains. It’s a complicated process, as simple as it may sound. Equity investments have consistently outperformed all other assets, making them a valuable resource for those aiming to expand their wealth. It might surprise you to learn that a $10,000 investment in the S&P 500 index 50 years ago would be worth nearly $1.2 million today. Stock investing, when done well, is among the most effective ways to build long-term wealth.  

Learning how to invest begins with learning how to invest in stocks. Nevertheless, if you’d like to know how to invest in stocks, here are 5 collapsed but crucial steps in order to do so: decide your investing approach and how much you will invest in stocks, open an investment account, diversify your stocks, and ultimately continue investing.  

In the next few years, stocks may become a regular part of our lives, as people are diving more and more into technology and trying to widen their economic opportunities. This could become a world where the next target could be Wall Street, the new “Halo” game or, perhaps the unthinkable, the United States Capitol. And here’s the uncomfortable secret most every game player knows: Games don’t often have good endings. What matters is how you play, and for that, you need to learn how to properly handle the game.  

References:

  • Frankel, M., 2021. How to Invest in Stocks: Step-by-Step Beginner’s Guide. [online] The Motley Fool. Available at: <https://www.fool.com/investing/how-to-invest/stocks/> [Accessed 3 March 2021]. 
  •  Gerson, J., 2021. We Asked Female Finance Pros to Explain GameStop Stocks. [online] Bustle. Available at: <https://www.bustle.com/life/gamestop-stocks-reddit-explained-female-finance-pros> [Accessed 3 March 2021]. 
  •  Tammy, J., 2021. Explaining the GameStop Stock Drama. [online] 103.KSON. Available at: <https://www.radio.com/kson/latest/explaining-the-gamestop-stock-drama> [Accessed 3 March 2021]. 

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