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Investors who traded meme stocks spent Wednesday looking at a lot of red.
The unofficial Meme stock index rose steadily on Wednesday, with big names falling significantly, and even a meme rotation in clean energy names appeared to be slowing as private investors played an uneventful game of Whack-a-Mole Find Strong Short -Shares to play on Squeeze.
But while the trade was ugly, retail investors saw a macro thriller as the signs saw the judiciary turns choppy for their old friend Robinhood HOOD, -3.34%.
Original memes like GameStop GME, -1.50%,
AMC Entertainment AMC, -3.92%,
Blackberry BB, -1.94% and Koss KOSS, -4.01% all closed to continue a rough weekly trend, and even new names like Clean Energy Fuels Corp. CLNE, -5.40% and Canoo GOEV, -3.26 % failed to benefit from what seemed like the momentum of meme stock traders earlier in the week plunging into renewables and green energies.
But one name has managed to benefit from this still barely breathing trend.
Camber Energy CEI, + 6.21% closed 6.2% after rising more than 30% in early trading. Camber, which saw a massive surge in retail social media interest in WallStreetBets according to data from HypeEquity, also started the day as one of the most heavily shorted stocks in the market.
According to a research note from Fintel, “raw short interest in Camber jumped from 6.1 million shares on August 31 to 24.4 million shares on September 15, a whopping 298%.”
For Camber, the old alchemy of strong short interest and high social media interest combined to give the natural gas outfit great meme energy on Wednesday.
However, this did not apply to other heavily abbreviated names. Katapult Holdings Inc.KPLT, -4.99% down 5%, e-commerce game Aterian ATER, -12.40% collapsed 12.4% and Vinco Ventures BBIG, -3.23% down 3, 2%.
Even newly listed hipster eyewear treasure Warby Parker WRBY, + 36.23%, failed to gain on meme steam, giving up a noon hike to close just 0.8%.
But not everything was dark and dreary on Reddit boards on Wednesday, thanks to more potential legal malicious glee from Robinhood HQ.
Another class action lawsuit filed on behalf of retailers in connection with the zero-commission trading app’s decision to stop trading Meme stocks on January 28 at the height of the chaotic short squeeze alleged that the Internal communications at Robinhood seem to indicate that the company’s chief operating officer unloaded its AMC stock just days before the app restricted trading in the stock.
According to the file, Jim Swartwout told his colleagues in an internal chat on January 26th: “I sold my AMC today.”
He then warned Robinhood colleagues: “For your information – tomorrow morning we will postpone GME to 100% – so that you are aware of it”. % on January 27, a full day before the decision to restrict access.
On Jan. 28, the company restricted trading in both and other stocks after realizing that it could no longer meet its clearinghouse obligations with the available liquidity.
This move might have protected Swartwout from losses in AMC stock, which had risen nearly 900% this month but would have fallen 56% in the days that followed after Robinhood blocked access to its platform.
The lawsuit was widespread Wednesday afternoon, sparking a flurry of subreddits devoted to speculation about Swartwout’s personal stock trading and a flurry of tweets suspecting the alleged stock trading and using them as further potential evidence to back up these anti Proofing retail chicane was a very real phenomenon at the height of the pressure in January.
Neither Swartwout nor Robinhood responded to comment on the lawsuit.