Alongside the coronavirus driven plunge in stocks in March, perhaps the biggest market story of 2020 has been the rise of an army of day-traders pouring into stocks.
Shares in bankrupt companies like Hertz and JCPenney saw massive price spikes thanks to day-traders buying their sharply discounted stock in pursuit of a quick buck.
When German fintech Wirecard went into insolvency, and shares plummeted, it looked like a flurry of day-traders would flock to the battered stock to make some quick money.
But Wirecard is so toxic that even traders on Robinhood — the zero-commission brokerage popular with millennials — said they would rather keep the stock at arm’s length, several users of the platform told Business Insider this week.
The user told Markets Insider that they’d made some money on the stock as it surged early this week, but has since pulled out.
“I made my bucks and won’t touch this s— again.”
“It was one of the few ‘once in a lifetime opportunities,’ I was lucky enough to ride on that wave, and I certainly won’t challenge my luck again by jumping into it one more time. F—, no.”
Not everyone is down is on Wirecard
But not all users were overly bearish on the stock. Some acknowledged it could rise or offer some potential, but still said they would exercise a degree of caution.
“Any rise out of Wirecard would come out of the same new investors with Robinhood accounts that necromanced Hertz a few weeks ago,” one said.
If this were to happen, it presents a great opportunity to buy puts.”
Another added: “It is possible that Wirecard gets bought up over 10 euros once again. That is mainly a result of shorts covering, put options being exercised and maybe, just maybe a bit of speculation.”
However, they added that they would not personally “touch it with a 10 feet pole.”