Shares in a Danish company jumped almost 15 times on the New York stock exchange for the day
Shares in a Danish company j...
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Shares in a Danish company jumped almost 15 times on the New York stock exchange for the day

12 June 2021
3268
2 min.
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Shares in a Danish company jumped almost 15 times on the New York stock exchange for the day

Shares have risen 15-fold

Shares in small Danish firm Orphazyme surged almost 15 times in value during Thursday's trading session on New York's Nasdaq electronic exchange. As Bloomberg reported on Friday, representatives of the firm and analysts have not yet been able to explain such interest in the small biotech company.

Orphazyme's shares were up 1,387% in trading at their peak on Thursday, it reported. Meanwhile, a similar rush was reflected in the company's shares on the Copenhagen Stock Exchange, where they also rose several times in value. The firm warned its investors that "those who buy the company's shares may lose a significant portion of their investment".

The frenzy around Orphazyme shares has now subsided, but its value on Nasdaq is still above normal by 70%.

As the agency notes, Orphazyme has presumably become another example of the new "meme-share" phenomenon, where small investors, agreeing on forums, begin simultaneously buying up massively shares of a randomly selected, usually small company, which entails an explosive growth in its capitalisation. The most striking example of "meme-action" was the story of GameStop, the value of its shares soared by more than 2,000% in a month. This was caused by a short-squeeze organised through the online forum Reddit by private traders, who often used the Robinhood mobile app to place their bets. As a result, hedge funds that play the low side suffered billions of dollars in losses.

Such securities manipulation causes sharp fluctuations on the US stock market. The head of the US Federal Securities and Exchange Commission (SEC), Gary Gensler, said on Thursday that the rules by which US exchanges are traded are outdated, and ways should be sought to update them to reflect modern realities. In his opinion, the financial regulator needs to look into the phenomenon of gaming the investment approach, as well as to pay attention to the fact that most of the orders to buy or sell stocks now go through alternative trading platforms first.
 

Persons1 and Companies7 in the news

Chairman of Unined States Securities and Exchange Commission
1 place
Orphazyme
1 place
Reddit
2 place
Robinhood
3 place
GameStop
4 place
Nasdaq
5 place
Bloomberg L.P.
7 place
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