Twitch streamer TheStockGuy explains GameStop stock situation in simplest way - Dexerto
Entertainment

Twitch streamer TheStockGuy explains GameStop stock situation in simplest way

Published: 28/Jan/2021 12:19 Updated: 29/Jan/2021 16:32

by Calum Patterson

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You’ve probably heard all the fuss over GameStop stock recently, and know it has something to do with Reddit and hedge funds. If you’re as clueless about stocks as most of us are, then  Twitch streamer TheStockGuy is on hand to break it down simply.

GameStop, the high-street/mall retailer of new and used games and hardware, has been seen as a struggling business because of the trend of gamers buying their games digitally, instead of discs.

As a result, its share price has been on a downward trend, although with some resurgence thanks to new management and the launch of the newest generation of consoles from PlayStation and Xbox.

Reddit’s GameStop stock game

If you don’t know the first thing about the stock market, you might be wondering why there’s so much fuss being made over the huge increase in GameStop’s share price, which reached over $300 on January 27. One week earlier, it was only $39.

GameStop GME stock
Google
The share price of GameStop has skyrocketed.

This is largely down to a subreddit called r/WallStreetBets – but how did they do it, and why?

Twitch streamer TheStockGuy, who does live investing on stream, took some time out on January 27 to explain it, in the most understandable way possible.

Shorting

He begins by explaining that ‘shorting’ is when an institution (a hedge fund in this case) borrows stock, sells it, waits for the price to fall, then buys it back to return it – profiting off the difference. But, if the price rises instead, then they have to buy it back at a higher price – which can be very costly.

Short Squeeze

The ‘short squeeze’ is what r/WallStreetBets has caused. When they caught on that a company had shorted 140% of GameStop shares, they were able to drive the price of the stock up, simply by buying it in droves.

“A short squeeze is when a stock is going up, [the hedge fund] borrowed those shares, and they’re now underwater – those shares are worth more than they borrowed. And if that continues up, at some point they have to cover their shares – they have to buy those shares back at whatever the current price is.

“They now have to spend billions of dollars to buy shares, way higher than what they borrowed them at, which in turn, drives the price up more, rinse repeat. And when a bunch of degens found out about this, ‘we can now f**k this guy over and make money if they have to dump capital in and shoot the price up? Thank you.’ And the last nail in the coffin was old Elon Musk.”

Elon Musk tweeted about the frenzy, sending it even further into the public consciousness. The situation has now reached the White House, the Biden’s administration reassuring reporters that they are keeping an eye on the situation.

Meanwhile, the WallStreetBets Discord server was shut down, although Discord says it was because of hate speech and glorifying violence, rather than their financial activities. Respondents on social media were suspicious of the coincidental timing though.

Who knows where the situation will escalate from here, but eventually the train will come to a stop, TheStockGuy says. And before it does, investors need to know when to get off the train.

Entertainment

How does Addison Rae make money? TikTok star’s revenue streams explained

Published: 24/Feb/2021 16:04 Updated: 24/Feb/2021 16:27

by Adam Fitch

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When you think of the select few who are at the forefront of the current wave of influencers-turned-entertainment-giants, Addison Rae Easterling comes to mind. The TikTok star has blown up, especially over the past year, and she’s poised to make millions of dollars because of it.

The 20-year-old is traditionally a dancer, competing in the sport across the United States since the age of six. After blowing up on TikTok from, unsurprisingly, dancing, in late 2019, she’s amassed millions of followers across all major social media platforms.

The typical method of monetization for influencers comes in the form of sponsored posts and brand deals, and that certainly was the case for Addison early on. Though, after signing with talent agency WME in January 2020, she has her sights set on devising major revenue streams across multiple mediums.

From pretty standard ways of making money like advertisements on YouTube to launching her own beauty line, Addison is proof that social networks such as TikTok can serve as launchpads for a career that’s much bigger than any single platform. As she continues to expand her footprint and command higher paydays, it’s worthwhile looking at how she’s building an empire that may well set her up for life.

How Addison Rae makes money

Content

Addison Rae Mama Knows Best Podcast
Spotify
Spotify are hoping to bring more teenages to their platform with Addison Rae’s podcast.

Addison Rae is a major force in the world of content creation, it’s even been reported that she was the highest-earning TikToker in 2019. The majority of her income, which was said to be $5m that year, was from posting sponsored posts for the likes of Rebook and Fashion Nova.

When going live on TikTok, viewers can donate in the form of gifting. Addison Rae, once living in the Hype House — a collective of content creators in Los Angeles — has gone live with her friends to give further insight into her lifestyle, an enviable one for her many young fans. So, from TikTok alone, she’s made plenty from gifting and branded content deals.

Then, as you’d perhaps expect, there’s YouTube. The Google-owned video platform isn’t Addison’s main platform but she’s proven that she is a hit on there whenever she chooses to post. With 4.64m subscribers at the time of writing after posting only 16 videos, she makes money from adverts on her content and sponsorships from brands.

It’s clear that sponsored content is a big driver of revenue for the dancer, and that translates over to Instagram too. Companies such as American Eagle, Disney, and Daniel Wellington have all paid healthy sums to have a presence on her ever-popular feed.

Moving away from video content, Addison Rae signed a podcast deal with Spotify in July 2020. Published weekly, Mama Knows Best is an original audio product from the TikTok star and her mother, Sheri Nicole. The show is produced by Spotify-owned Parcast. There’s no word on how much she’s being paid for this endeavour but if it’s even a fraction of the deal Joe Rogan closed then she’s receiving handsome cheques for her weekly show.

Other ventures

Addison Rae Merchandise
Fanjoy
The internet celebrity’s merchandise range features lines based on popular phrases she coined through TikTok.

A fairly typical avenue for content creators to go down when they amass popularity is merchandise, and that’s no different with Addison Rae. She launched her own self-named merchandise store, in collaboration with Fanjoy, on May 1, 2020. Products available for purchase include clothes, phone cases, notebooks, and mugs.

An extension of her popular Instagram is a blossoming modelling career, one that was kickstarted by posing for Kim Kardashian’s SKIMS brand. She found herself blown up on a billboard in New York City in some of Kardashian’s line and has since publicly spoken about how much she enjoyed the experience. As she continues to grow in popularity, she’ll be tapped to be a face of major brands.

Getting further into the world of business, Addison Rae launched a joint venture with Madeby Collective in August 2020. ITEM Beauty is a makeup line that is said to be cruelty-free and vegan-friendly. It launched with just a handful of products but that’s to be expected; you wouldn’t want to invest too much into a new business initiative just to find out it wasn’t in-demand. More products have been launched since, perhaps indicating that it was received well by her audience.

Addison Rae ITEM Beauty
ITEM
Addison Rae’s beauty line ITEM launched with a limited range but has since expanded.

Film & music

In September 2020, Addison took a major step into the world of traditional entertainment when it was announced that she had been cast in a movie. ‘He’s All That’ is a remake of the 1999 comedy ‘She’s All That’ and she’s occupying the main role. At the time of writing, she’s busy at work filming her Hollywood debut.

While not confirmed, it appears as if she has other ventures in the works too. As expected based on her desires to pursue many facets of the entertainment industry, there are rumors that she’ll soon be launching a music career, including a Nicki Minaj collab, and that she has a reality television show in the works. One thing is for certain though, and that is she has no interest in being pigeonholed — there’s no doubt she’ll make a killing financially along the way, too.