As GameStop’s share price falls back down, Business Because has asked business school professors whether Wall Street Bets’ bid to take on the establishment could be the start of a new impact investing social movement.
Johan Hombert, professor of finance at HEC Paris, believes that day trading may have had its day. Ultimately, short term trading is a zero-sum game. “When one of the traders is an individual investor and the other trader is a hedge fund, guess what happens. Hedge funds have more resources and better information, so they are better able to predict short-term movements in stock prices,” he says. “As a result, more often than not, retail day traders' losses are hedge funds' gains."