GameStop, a major video game retailer, is getting a lot of publicity in recent days as the price of their stock market shares go up and down.
If you’ve watched the news or been on social media at all in the last couple of days, you’ve seen articles and posts about GameStop and the stock market.
In a nutshell, a large number of online day-traders united by the message board Reddit collectively decided to invest in GameStop, a stock that was on a downward trend.
Some wall street hedge funds had “shorted” the GameStop stock, essentially betting against the long-term health of the retail company and anticipating they would potentially go out of business.
The online investors, many of which were using apps on their smartphone to buy and sell stocks, were driving the price of GameStop stock north, which was squeezing the hedge funds and potentially costing them billions of dollars. The apps locked down trading on this and other stocks, including Bed Bath & Beyond, Blackberry and more. This action set off a firestorm, and limited trading has been allowed again for these stocks.
For serious, long-term investors like you, this attempt at short-term gains with volatile individual stocks is an area of investing we do not recommend. When we created your family’s financial plan, gauged your risk tolerance and built your portfolio, it was all done with long-term goals in mind.
The best thing for you to do? Nothing. Simply ignore this feeding frenzy of the moment and instead enjoy the confidence and financial reassurance of having a sound, long-term plan in place.
As always, feel free to reach out with any questions. We’re always happy to help!