Christopher Cole runs Artemis Capital, a volatility-focused hedge-fund manager based in Austin.
He walked Insider through his biggest takeaways from the GameStop-fueled market frenzy at the end of January.
He believes Wall Street is underestimating the power of social media.
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GameStop’s slogan — “Power to the Players” — seems oddly prescient now.
The brick-and-mortar video-game retailer’s stock was the center of a market frenzy that many on one side — the Reddit-driven retail traders — treated as a game, despite the billions of dollars-worth of chaos the volatility created.
The power of social media hadn’t yet been trained on the markets before, at least not on a few targets like that, and the effects have been widespread. Melvin Capital, the hedge fund at the center of it, was forced to turn to Ken Griffin and Steve Cohen for billions to stay afloat.
Robinhood, the online trading platform many of the Wall Street Bets crowd used, tapped its existing investors’ billions as well, and everyone from Ja Rule to Ted Cruz weighed in when the brokerage restricted trading in the targeted stocks. Market volatility caused by the trading has some investors like Maverick Capital founder Lee Ainslie excited for opportunities while others, like Two Sigma and D1 Capital, are trying to rebound.
To Christopher Cole though, the biggest and most important effect from the frenzy still hasn’t hit Wall Street’s establishment yet.