GameStop is ready for growth again, but some are betting against it
Investing.com - After an opening week marked by sharp declines over two sessions (by about 17%), shares of gaming company GameStop (NYSE:GME) have moved back up at the end of the week.
Having already been short-squeezed before, the stock has been the target of similar attention this time as well: legendary investor Bill Gross, co-founder of Pimco, is betting against GameStop securities again by selling call options after escaping their wild volatility in January, earning $10 million.
Since the volatility of these stocks is very high, he said, "it facilitates the opportunity to make some money, which means it's a great opportunity not for buyers but for option sellers." The renowned investor added that he has sold call options at $250 and $300, which means he will make money if the stock, which is currently trading at $209.81, stays below those levels.
But there is another possibility - to lose if the highly volatile stock returns to the levels above $300 seen in January. Gross said in February that at one point in January's GameStop "saga" he lost $10-15m when retail traders raised the price to an intraday high above $480.
"I was losing millions of dollars and it kept me up at night," he revealed.
However, Gross explained that he ended up earning $10m after holding out while the stock plummeted in price.
