Tiffany Hagler-Geard | Bloomberg | Getty Images
GameStop shares gained 11% of their pre-market trading on Wednesday, as the short-term stress fueled by Reddit retailers appears to be reviving after a sharp decline.
The stock fell more than 11% earlier Wednesday morning, but fell to black shortly after 5 a.m. ET.
Shares of the brick video game retailer rose 1.625% in January and 400% last week alone, while Reddit-led WallStreetBets traders stocked up.
But the momentum dropped earlier this week. Gamestop shares fell 60% on Tuesday and lost more than 70% of its value on Friday.
AMC Entertainment, another very short stock, which was also targeted by Reddit traders, grew by about 4% in premarket trading.
Robinhood and other retail applications continue to limit the purchase of a collection of shares tracked by Reddit. Many Wall Street hedge funds began to hedge shortly after the end of last week, after suffering significant losses.
Short selling is a strategy in which investors borrow shares of a stock at a certain price, depending on expectations that the market value will fall below that level when it is time to pay for the borrowed shares. Redemption of borrowed shares to close a short position, either for profit or loss, is known as short hedging.