Analysis on the effects of wallstreetbets on the stock market

Abstract

In January of 2021, the stocks of various companies, i.e. Gamestop, AMC etc. had a huge surge in price. The incident was attributed to redditors of the subreddit called r/wallstreetbets making a massively coordinated strategy to short squeeze the market. It is likely that the stocks prices were directly affected by the aforementioned subreddit. To better understand the effect on the market wallstreetbets had, we will analyse the reddit posts from wallstreetbets subreddit with stock prices data set. Our intention is to understand this phenomena and find out if the subreddit really had a substantial effect on the market. We also like run our model to figure the level of involvement with the stocks of GME and AMC In our research, we show that r/Wallstreetbets had a direct influence and correlation on various stock prices by using sentiment analysis and supervised machine learning algorithms.