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Medicare-backed insurance seller Clover Health is a new favorite
of small-time traders who had previously sent shares of GameStop
Corp and AMC Entertainment Holdings soaring using social media
channels such as Reddit's WallStreetBets.
On trading-focused site Stocktwits, message volume related to
Clover Health more than doubled and 95.4% of the messages
reflected a positive sentiment toward the heavily shorted stock.
Clover Health was also among the most traded stocks premarket
after logging the highest trading volume on U.S. exchanges on
Tuesday.
Among other "meme stocks", shares of video-game retailer
GameStop were up 2.7% on Wednesday, while AMC and security
solutions provider BlackBerry's U.S.-listing fell 7.4% and 5.4%,
respectively.
Lordstown Motors Corp was down 1.4% after Tuesday's 16.3%
tumble, which was sparked by a "going concern" warning.
The recent surge in some meme stocks has spurred some hedge
funds into using options to bet against them while capping risk,
seeking to avoid the fate of Melvin Capital, which was hit hard
after betting against GameStop earlier this year.
Clover's stock has climbed about 32% in the year through last
close, with a Reddit-fueled jump of 190% this month making up
for lackluster returns earlier in the year.
(Reporting by Sagarika Jaisinghani and Aaron Saldanha in
Bengaluru; Editing by Sriraj Kalluvila)
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