Screenings of “Dumb Money,” a film released the previous week depicting the GameStop short squeeze, will be accompanied by a warning from the UK’s Financial Conduct Authority (FCA) regarding investment risks.
The FCA intends to demonstrate through this measure how public enthusiasm can influence investment decisions and encourages the audience to undertake comprehensive research before yielding to tempting online propositions.
Positioned in the prestigious ‘Gold Spot’—the last advertisement showcased before the commencement of the film—the message utilizes the cinema’s dimming lights and vacant screen to deliver a voiceover about a “once-in-a-lifetime opportunity to make some serious money.”
The revelation that such advice is sourced from an unidentified online forum user concludes the message, subsequently emphasizing the FCA’s cautionary slogan, ‘Don’t Get Played.’ The advertisement also directs viewers to online resources where they can seek advice on secure investment practices.
By employing digital displays in cinema lobbies, geo-targeted ads aimed at cinema attendees, and online advertisements in places frequented by investment researchers, the strategy aims to inform viewers of the perils associated with heeding online investment advice—perhaps even endeavouring to prevent a sequel to “Dumb Money” from materializing.
“Dumb Money” narrates the tale of the 2021 GameStop short squeeze, a financial episode causing significant losses for numerous hedge funds and investment firms. These entities had extensively shorted the faltering video game retailer’s stock, which unexpectedly became a viral meme stock for individual investors.
Groups of retail investors, congregating on social platforms like Reddit, played a crucial role in escalating the value of GameStop Corp (NYSE: GME), consequently compelling those who had shorted the stock to either sell or face escalating losses.
Several retail investors, some of whom had realized substantial profits from investing in the meme-stock, have since witnessed a considerable erosion of the value accrued during that period. Presently, GameStop’s stock is trading nearly 70% below its peak values in 2021.
