With the market crash earlier this year, Robinhood became a household name and a staple trading application among millenial traders. During that time a website, known as RobinTrack, displayed some of Robinhood’s publicly available data on how many users own at least one share of a specific stock. Unfortunately, Robinhood stopped providing that data in their free API and the website is no longer available.
SwaggyStocks has grabbed the reins and is providing data through a similar concept. Instead of tracking shares of stocks owned by Robinhood traders, they track sentiment on popular Reddit forums, more specifically, the “WallStreetBets” sub-reddit. Interestingly enough these “traders” (although they prefer to call themselves autists), have gained popularity on the internet by posting crazy “YOLO” type bets on options expiring as early as next Friday’s option expiration. What’s the catch? Well, for every $100k “gainz” screenshot there are usually a handful more showing off their $50k losses like it’s nothing. They do this to be rewarded with internet points and popularity among the sub-reddit, but does this group of YOLO stock-pickers have a method to the madness? SwaggyStocks provides some context on the WallStreetBets trading methodologies.
Going through the sentiment and comment volume charts on the SwaggyStocks – Ticker Sentiment page, we can see that the most mentioned stock tickers are indeed all momentum stocks, or what’s currently “hot” and trendy. Here’s a quick look at the time of writing.
The top 5 most mentioned tickers are: MT, TSLA, PLTR, GME, NIO. Clearly most of these are meme stocks with exceptionally high volatility. Let’s take a look at the sentiment chart for Palantir (PLTR) from back in November.
It is quite clear to see that the uptick in WallStreetBets chatter for the ticker is reactive to the stock price. As the stock price went up, so did the volume of comments per day. The true phenomena here was that not only was the stock price doubling and tripling, but as the stock price increased, WallStreetBets users continued buying short-term call options making bank all the way up. At it’s peak, there was so much hype surrounding PLTR that 50% of all comments mentioning a ticker in the daily chat included the PLTR ticker. One WallStreetBets trader commented “joined the pltr call gang am i a millionaire yet”, while another mentioned “if pltr goes to 27.4 eod (end of day) im gonna nut“. Whether this is sarcasm or for serious, nobody really knows.
A similar situation is currently happening with ArcelorMittal (MT).
What kind of a company is MT, you say? Well, after doing some research they manufacture steel. Steel futures have been booming and MT is up 30% over the last several days. Like clockwork WallStreetBets have hopped on the trend hoping to ride this train to “tendie town”. Comment volume for this ticker has shot up to approximately 10% market share of all tickers mentioned. Will the stock price on this one continue it’s uptrend and moon mission like many other stocks that have “memed” on WallStreetBets? Or will it crash and burn along with several Robinhood accounts? Only time will tell.