Place Your Bets? The Value of Investment Research on Reddit’s Wallstreetbets

Daniel Bradley, Jan Hanousek, Russell Jame, Zicheng Xiao

Research output: Contribution to journalArticlepeer-review


We examine the value of due diligence recommendations on Reddit’s Wallstreetbets (WSB) platform. Before the Gamestop (GME) short squeeze, recommendations are significant predictors of returns and cash-flow news. This predictability is eliminated post-GME. Post-GME, the fraction of reports emphasizing price-pressure or attention-grabbing stocks dramatically increases, and the decline in informativeness is concentrated in these reports. Similarly, retail trade informativeness is particularly strong following DD reports in the pre-GME period, but not post-GME. Our findings are consistent with the view that the Gamestop event altered the culture of WSB, leading to a deterioration in investment quality that adversely affected smaller investors.

Original languageEnglish
Pages (from-to)1409-1459
Number of pages51
JournalReview of Financial Studies
Issue number5
StatePublished - May 2024

Bibliographical note

Publisher Copyright:
© The Author(s) 2023. Published by Oxford University Press on behalf of The Society for Financial Studies.

ASJC Scopus subject areas

  • Accounting
  • Finance
  • Economics and Econometrics


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