For GameStop Investors, It's Game On The stock has gone up 300 percent, causing a battle between short- and long-sellers.

By Michelle Jones

entrepreneur daily

This story originally appeared on ValueWalk

Spencer Platt | Getty Images

GameStop has become a battleground stock as retail investors face-off with wealthy investors, with the former going long and the latter going short. GameStop stock has skyrocketed more than 400 percent in the last three months, even though the company has been losing money.

Related: Did Reddit Fuel GameStop's Massive Stock Surge?

Stock soars despite losses

On Monday morning, GameStop stock surged almost 145 percent in less than two hours. However, the shares came crashing back down to Earth and closed with an 18 percent gain for the day. Already this morning, the stock is up more than 14 percent in early trading. Over the last three months, GameStop shares are up over 400 percent.

The video game and console retailer lost $1.6 billion over the past three years. According to CBS News, GameStop stock declined for six consecutive years before rallying last year. Many professional investors have been betting against the company because they expect it to keep struggling as video game sales keep moving online.

GameStop stock surged after the company appointed three new board members, including one of Chewy's co-founders. Investors who went long on the stock are betting that the new board members will accelerate the retailer's turnaround. GameStop doubled in only five days after the board additions were announced.

On Friday, the shares surged more than 50% in only one day. That's more than the entire stock market has climbed in over three years, according to CBS. The volatility was so extreme on Monday that GameStop stock was temporarily halted at least nine times.

Battle Royale

One of the more prominent short-sellers, Andrew Left of Citron Research, said that GameStop shares are worth no more than $20, based on earnings and sales alone. He has repeatedly predicted that the stock will fall to $20, although it has surged past $80. Just weeks ago, GameStop was trading at less than $18.

Unfortunately for short-sellers, betting against GameStop hasn't worked out well, and a short squeeze has ensued. Numerous retail investors have been encouraging each other on Reddit to keep GameStop shares shooting higher. Many describe the battle between the longs and shorts as regular investors against hedge funds and major Wall Street firms.

The fight has even turned dangerous. Left said on Friday that he wouldn't talk about GameStop stock anymore because someone had threatened him and his family. A video in which he explained why he thought the shares would fall has been removed from YouTube.

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Business News

Barbara Corcoran Sounds Off on NAR Settlement: 'It's a Scary Time for Real Estate Agents'

The "Shark Tank" star took to Instagram to share her thoughts on Friday's ruling.

Side Hustle

Her 'Crude Prototype' and $50 Craigslist Purchase Launched a Side Hustle That Hit $1 Million in Sales — Now the Business Generates Up to $20 Million a Year

Elle Rowley experienced a "surge of creative inspiration" after she had her first baby in 2009 — and it wasn't long before she landed on a great idea.

Starting a Business

A Side Hustle Consultant Shares the Most Lucrative Gigs Right Now

Plus, he answers the side hustle questions he gets most often from clients.

Starting a Business

She Never Wanted to Start a Business, But Chronic Insomnia Was Motivation — Here's How She Achieved $20 Million in Sales and 8 Hours of Sleep a Night

Dr. Kathrin Hamm, founder and CEO of sleep-wellness company Bearaby, wanted to find a solution for her sleeplessness — and the products on the market weren't cutting it.

Business Ideas

63 Small Business Ideas to Start in 2024

We put together a list of the best, most profitable small business ideas for entrepreneurs to pursue in 2024.