'Bond King' Bill Gross made millions betting against GameStop. He says the stock is behaving like bitcoin now.
The billionaire investor told Business Insider he had "no interest" in Opendoor, Kohl's, American Eagle, and other stocks whose prices spiked as buzz on Reddit and other social media spurred retail traders to pile in.
Day traders have Microsoft and Meta "to play with for now," Gross said. The tech titans are up 30% and 25% respectively this year because of AI excitement.
Gross says GameStop isn't acting like a meme stock
Gross — known as the "Bond King" for growing fixed-income titan PIMCO's flagship Total Return Fund to $270 billion over nearly 30 years — said the stock that started it all, GameStop, is "not behaving like a meme" and is "much less volatile" than before.
He added he still viewed it as a "good candidate for option selling."
He added that the stock "seems to mimic bitcoin," the most valuable cryptocurrency, known for its volatility and passionate fanbase.
Bitcoin's price fell by a quarter between early January and early April this year, but has rallied to record highs of above $110,000. GameStop announced its first bitcoin purchase in late May, securing 4,710 tokens worth around $537 million at current prices.
Adjusted for a stock split in 2022, GameStop soared from around $1 in the summer of 2020 to a peak intraday price of $121 on January 28, 2021. It has traded within a much tighter range of around $20 to $35 over the past 12 months.
It followed a similar trajectory to bitcoin by rising sharply in the fourth quarter of 2024, slumping this spring, and rebounding through early June.
However, GameStop then fell after disappointing first-quarter earnings and dilutive share sales, whereas bitcoin kept climbing to fresh highs in July.
Gross bet against GameStop by selling call options at the height of its meme-stock surge in January 2021. An options contract gives the buyer the right to purchase or sell a stock at an agreed price within a set period. Sellers wager these contracts will expire worthless, and they can simply keep the premium paid by the buyer.
Gross was $15 million in the red, losing sleep at one point as GameStop kept climbing, but he doubled down. He later said he made between $15 million and $20 million betting against GameStop and AMC.
"I knew I had an advantage over Reddit and the boys," Gross has said about his original meme-stock wagers, as he had access to real-time options and volatility data on his Bloomberg terminal.
Gross has been a vocal skeptic of meme stocks for years, calling them "lottery tickets" and describing buyers of overpriced options as "fish at the poker table." He's also said that each buying frenzy ends with a "musical chair, me-first exit" from the stock.
Besides GameStop and AMC, Gross also sold put and call options on Trump Media in the spring of 2024 to cash in on the craze around the president's stock.
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For more info: Story produced by Mark Hudspeth, Madeleine May and Dan Ruetenik. Editor: Jason Schmidt. See also:
