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Gamestop Short Squeeze
What sort of business is the American company Gamestop?
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Slide 1:
Open question
Economie
Voortgezet speciaal onderwijs
This lesson contains
19 slides
, with
interactive quizzes
,
text slides
and
2 videos
.
Lesson duration is:
30 min
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Items in this lesson
What sort of business is the American company Gamestop?
Slide 1 - Open question
How is this company doing during lockdown?
And this one?
Slide 2 - Slide
In finances, what is a share?
Slide 3 - Open question
Slide 4 - Video
When do you earn money with a share?
Slide 5 - Open question
Slide 6 - Video
'Long' trades
'Normal'
I buy now and try and sell later for more money.
For example: I buy 100 ABM AMRO shares for €8.56 each and sell them later for €9.26 making a profit of €70.
Profit is made when the value of shares
rises
.
Slide 7 - Slide
https:
Slide 8 - Link
'Short' selling
You need a special contract to make these deals.
I borrow some shares (for a fee) sell them with the agreement to buy them back on a fixed date in the future for the market value.
For example: I sell 100 ABM AMRO shares for €8.56 each and buy them later for €7.86 making a profit of €70.
Profit is made when the value of shares falls.
Slide 9 - Slide
Short Selling
Slide 10 - Slide
https:
Slide 11 - Link
What happened with Gamestop?
Large investors (hedge funds) sell short with Gamestop.
Large groups of individuals see that and buy shares.
The share price rises.
The hedge funds lose loads of money ($70 billion)
Slide 12 - Slide
And now?
Some share dealers have been blocked by the authorities from dealing in Gamestop (Robin Hood)
The story continues on social media but has broken through to the mainstream media.
Slide 13 - Slide
How will this end?
Slide 14 - Open question
https:
Slide 15 - Link
I buy 10 shares for €10 each. Tomorrow they are worth €11.
I make...
A
€1 profit
B
€1 loss
C
€10 profit
D
€10 loss
Slide 16 - Quiz
I go short on 10 shares with a price of €10 each.
Tomorrow they are worth €5.
I make...
A
€5 profit
B
€5 loss
C
€50 profit
D
€50 loss
Slide 17 - Quiz
I go short on 10 shares with a price of €10 each.
Tomorrow they are worth €100.
I make...
A
€90 profit
B
€90 loss
C
€900 profit
D
€900 loss
Slide 18 - Quiz
Which companies will be hit by the lockdown measures? Find out five likely victims. Be ready to share them next lesson.
Who knows, perhaps you can spot the next Gamestop?!
Slide 19 - Slide
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