Management didn't confirm it, but GameSpot reported last week that GameStops in the vicinity of a Wal-Mart were offering extra trade-in credit - certainly not a sign that GameStop is welcoming the increased competition.
Wal-Mart's entrance into the used games space is, as I've already noted, a major challenge to GameStop. Raines didn't refer to Wal-Mart specifically here, but he seemed to be heavily implying it. In other words, I think it's absolutely ludicrous to suggest that consumers (particularly gamers) are not aware of GameStop's used-games business model. GameStop has 27 million members of its PowerUp Rewards program - a frequent shopper program that, for a $15 annual fee, offers discounts on games and accessories. Anyone who has ever shopped at the chain will know that its associates push pre-owned software aggressively, and that it often runs specials on pre-owned products with brightly colored banners adorning the store's windows. With more than 6,400 stores, it's difficult to find a town or even strip mall in the U.S. Rather than limiting access, the focus should be on educating investors so that they understand the risks of investing, including riding the rally and its likely aftermath.Consumers have low top of mind awareness of buy-sell-trade and new competitors will drive greater overall awareness of the category, which has always been very good for our business. Providing a wider swath of individuals with access to the market opens needed opportunities to build wealth over the long-term. Recent retail investors tend to be younger with much smaller account balances, and have gravitated towards app-based trading. Retail investors provide market liquidity, and their diverse trading strategies can be especially valuable when the market is under stress. Rather, viewing the GameStop rally as reason to limit retail investors misses the great potential present for both the market and individuals. Drawing the right line to prevent what Massachusetts Secretary of State William Galvin, the state’s top securities regulator, has called trading with “no basis in reality” is an impossible task. Stepping in to prevent trading where a stock price soars (or declines) contrary to conventional wisdom could limit legitimate information important to the market. Similarly, Kodak experienced unexpected gains last year after the announcement of their move into pharmaceuticals, and investors who crowded into Hertz may have been more optimistic than Wall Street about the company’s ability to survive bankruptcy. 11 announcement that it added three new directors to its board with an eye towards turning around its online presence.
GameStop’s rise was arguably tied, at least initially, to a Jan. Others are calling for even more dramatic reform. Federal regulators are “monitoring” the situation and state regulators have already announced their intentions to review the role of online trading apps. By pulling GameStop’s stock into the stratosphere, individual investors pulled down big Wall Street players who never imagined that retail investors could pull off a short squeeze. Rallies usually attract some attention, but this one uniquely affected the stock of a company not projected to turn a profit for another two years. As of this writing, at over $400 a share, GameStop is worth 10 times its value a week ago. Instead, a flood of retail investors joined forces on Reddit’s WallStreetBets forum to send GameStop’s stock soaring. But that didn’t stop individual investors from taking those bets. Just days ago, major hedge funds were betting big money against the success of the video game retailer in the form of short sales. The sudden surge in the price of GameStop’s stock has attracted the attention of trading platforms, regulators and even the White House.
0 kommentar(er)
