Gadgets
Robinhood Adopts Meme Stocks Mantle and Their Violent Swings
The trading app that helped fuel the memeification of the stock market soared and tumbled this week as individuals flipped shares. The stock rallied as much as 19 percent Friday and took centre stage, ranking among the most actively traded companies valued at more than $500 million (roughly Rs. 3,724 crores). Robinhood finished with a gain of 56.5 percent for the week.
Loyalists were building on the rally that added $30.2 billion (roughly Rs. 2.24 lakh crores) of market value earlier in the week. Skeptics focused on Thursday’s 28 percent drop after insiders filed to sell a huge chunk of shares, including venture capitalists who took convertible stakes just six months ago at deep discounts in return for rescuing Robinhood from a margin call. The doubters also wondered aloud where individuals will get enough cash — perhaps from other meme stocks — to keep the rally alive.
“Investors need to recognise that this is going to trade like a crypto or other meme-related stocks in the short run and they could see significant positional changes,” said Eric Schiffer, chairman of Patriarch Organization, a Los Angeles-based private equity firm.
The insiders won’t be able to begin selling shares until they get clearance from the US Securities and Exchange Commission, Robinhood said on Friday. That could take awhile; the company first must file its quarterly report with the SEC, something management doesn’t expect to do until August 18.
Bigger Float
This only delays rather than denies the day of reckoning. The insiders would still be positioned to take advantage of the recent surge while feeding shares in two parts to public investors at full market price. The impact on liquidity could be substantial: Only a fraction of Robinhood’s more than 700 million shares are currently available for trading.
Nora Chan, a spokeswoman for Menlo Park, California-based Robinhood, declined to comment beyond previous statements. “We’re not thinking about anything that happens in the market, especially in the short term,” Chief Executive Officer Vladimir Tenev said when the stock debuted. “The goal is to keep making great products, to keep improving the service and keep growing with customers.”
A three-day rally to start this week was triggered by news that Cathie Wood’s exchange-traded funds were snapping up shares and was refueled when options started trading Wednesday. Traders were quick to call out the impact, with the derivatives a key part of the tools individual investors use to power shares higher.
“You have good news, you have thin markets, you have these out-of-the-money strike prices being listed, and the trading volume looks like it overwhelmed option dealers,” said Christopher Vecchio, senior analyst at DailyFX.com. “It was the perfect recipe for a little bit of a gamma squeeze.”
Gamma squeezes happen when options dealers buy a rising stock to balance their exposure to contracts they have sold, pushing the shares even higher. The phenomenon was likely behind Wednesday morning’s 82 percent surge.
The stock’s meme status was cemented when it ranked as the most traded on Fidelity’s platform for most of the week, outpacing AMC Entertainment Holdings and Moderna. Robinhood was also among the most popular stocks mentioned on StockTwits and Reddit, even as trading and prices for a basket of 37 meme stocks tracked by Bloomberg fizzled for a third week.
To be sure, that group is up over 60 percent this year with AMC rising more than 1,400 percent and GameStop up 700 percent. But with those shares cooling, retail investors might be tempted to swiftly rotate their paper gains into Robinhood. They’ve bought roughly $108 million (roughly Rs. 804 crores) of Robinhood since its debut, lagging the peak mania surrounding stocks like GameStop and AMC, data from Vanda Securities show.
“If retail investors start withdrawing money from tired meme stocks to buy HOOD, there is still room for the move to continue,” Vanda’s Ben Onatibia said.
The presence of amateur investors fueling rallies has made life difficult for fundamental analysts. Robinhood’s position at the center of it all drew Wolfe Research analyst Steven Chubak to start coverage with a peer-perform rating — and advice to stay away.
“We cannot in good faith recommend investors get involved in HOOD on either the long or short side,” the analyst wrote on August 5. There is “high ‘meme stock’ risk with outsized retail involvement,” which suggests Robinhood won’t trade on fundamentals.
Where meme traders strike next is anyone’s guess. The one thing many analysts agree on is that meme traders are playing a zero-sum game with limited cash — they may need to sell companies they own to buy new ones.
“They can only spend so much money,” Vecchio said. “We will see quite a bit of interesting activity over the coming weeks.”
– With assistance from Annie Massa
© 2021 Bloomberg LP
“At Xbox, we believe that with better tools, creators can make even more extraordinary games,” Haiyan Zhang, GM, Xbox Gaming AI, said in a blog post. “This partnership will bring together: Inworld’s expertise in working with generative AI models for character development, Microsoft’s cutting-edge cloud-based AI solutions including Azure OpenAI Service, Microsoft Research’s technical insights into the future of play, and Team Xbox’s strengths in revolutionizing accessible and responsible creator tools for all developers.”
The aforementioned AI design copilot is a toolset that will help game designers turn prompts into scripts and dialogue trees. In contrast, the character runtime will enable dynamically generated plot beats and quests. We’ve already seen heavy AI integration in games by way of procedural generation — a more recent example being the 1000+ planets in Starfield. Not to mention, enemy AI has been around for way longer.
Inworld made headlines in August when it launched a modded story mode for Grand Theft Auto V, Sentient Streets, in which players had to investigate the rise of a bizarre AI-worshipping cult — a segment loaded with characters that spoke in AI-generated dialogue, on the fly. The mod was later taken down by publisher Take-Two, leaving a permanent strike on the creator Bloc’s YouTube channel. As per The Verge, Inworld’s AI technology can also be used for narration in top-down RPGs to warn players about any events awaiting off-screen and respond to questions like we’ve seen in the past year with AI chatbots like ChatGPT and Bing Chat. Microsoft has also been heavily banking on artificial intelligence, having made a $10 billion (about Rs. 83,254 crore) investment in OpenAI. The company has also integrated AI tools into its popular suite of services and also added an AI copilot to Windows.
Despite being a Microsoft-affiliated AI toolset, it would be interesting to see whether titles using them will be allowed to thrive on other platforms. In July, Valve claimed that it would be cracking down on games that included AI-generated assets if the developer didn’t own the copyright to the piece of art. For the uninitiated, when you insert a prompt to create something in AI, the software simply repurposes existing assets found online and mushes them together — basically stealing from other artists and writers without appropriate commercial licenses. Infringing them would lead to the game not being distributed on Steam, forcing the developers to seek proper licenses for the asset by reaching out to the AI companies involved. It’s unclear how Microsoft’s partnership will play out — as long as AI content is being used as a catalyst to innovate and create something new, it should be fine.
In a post on X shared by BSNL’s Andhra Pradesh (@bsnl_ap_circle) unit, the company confirmed that BSNL users can upgrade their older 2G or 3G SIMs to a 4G SIM for free. Not only will the upgrade be free, but a promotional image shared with the post suggests that users who opt for the upgrade will also receive 4GB of free data that will be valid for three months. It is speculated that BSNL is aiming to boost its upcoming 4G services with this offer. The announcement was first spotted by Telecom Talk.
To access the free data offer and the free upgrade, BSNL users are requested to get in touch with executives at BSNL’s Customer Service Centre, franchisee or retailer stores, or contact one of their Direct Selling Agents (DSA). The promo image also adds in a finer print that the offer is available with certain terms and conditions, but hasn’t detailed any, so far.
Reliance’s Jio recently launched the 4G-supported Bharat B1 feature phone in India. The handset is priced at Rs. 1,299 in India. Alongside 4G connectivity, the phone comes with JioCinema and JioSaavn applications pre-installed.
The Jio Bharat B1 is equipped with the JioPay application, which is said to allow users to make UPI payments. Aiming to increase accessibility, the phone supports 23 languages overall, including multiple regional languages.
Realme, via Weibo, announced the arrival of the Realme GT 5 Pro in China. The display of the handset is confirmed to offer 3000 nits peak brightness. It has also been teased to offer heat dissipation with a surface area of around 10,000mm2. It is confirmed to ship with Qualcomm’s new Snapdragon 8 Gen 3 SoC. The post doesn’t specify the exact launch date of the smartphone, however, given the release of the teasers, the launch could be just around the corner.
The Realme GT 5 Pro has been in the news a lot lately. It is expected to feature a 6.78-inch (1,264×2,780 pixels) AMOLED display and is tipped to come in 8GB, 12GB, and 16GB RAM options along with 128GB, 256GB, 512GB, and 1TB inbuilt storage options.
For optics, the Realme GT 5 Pro is said to have a triple rear camera unit comprising two 50-megapixel sensors and an 8-megapixel shooter at the rear. The camera setup might include a Sony LYTIA LYT808 sensor, an OmniVision OV08D10 secondary sensor, and a Sony IMX890 telephoto sensor. For selfies, there could be a 32-megapixel sensor at the front. It is said to carry a 5,400mAh battery with support for 100W wired charging and 50W wireless charging.
The Realme GT 5 Pro is expected to come with upgrades over Realme GT 5. The latter was launched in China in August with a price tag of CNY 2,999 for the base model with 12GB of RAM and 256GB of storage.
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