The holding page of Keith Gill, the Reddit user who inspired the GameStop rally, before a YouTube livestream hosted on a laptop at the New York Stock Exchange on June 7, 2024.
Michael Nagle | Bloomberg | Getty Images
Sale in GameStop The stock intensified during afternoon trading Wednesday, coinciding with a surge in trading volume in call options held by meme stock leader Roaring Kitty.
Roaring Kitty, whose legal name is Keith Gill, revealed his portfolio for the last time Monday night, revealing he still owned 120,000 call options contracts with a $20 strike price and June 21 expiration date.
GameStop calls with an exact strike price and expiration date traded a whopping 93,266 contracts on Wednesday, more than nine times the 30-day average volume of 10,233 contracts. The price of these contracts fell more than 40% during the session, and the stock fell 16.5%.
It’s unclear whether Roaring Kitty was actually behind the heavy volume, but options traders say he may be involved given that he is a large holder of these contracts.
GameStop, 1 day
Options traders speculate that Gill will have to sell his calls before expiration or roll the position into another call option to avoid having to raise a huge amount of money to exercise them on June 21.
Wall Street had been waiting for hints that he was selling the position because it could push down the stock price.
For Gill to exercise the calls, he would need to have $240 million in stock held—12 million shares purchased at $20 apiece—which is more than he publicly disclosed in his E-Trade account.
CNBC’s Fast Money will discuss GameStop at 5:00 pm ET.