- SoFi has become the most-mentioned stock on Reddit's WallStreetBets forum, overtaking GameStop.
- The fintech's shares soared after it cleared the final regulatory hurdle to become a bank.
- Retail traders on the subreddit can be a force in the stock market, as in last year's GameStop frenzy.
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SoFi has become the most-mentioned stock on Reddit's WallStreetBets forum after getting approval from regulators to set up a fully fledged bank on Tuesday.
The San Francisco-based fintech leapfrogged GameStop and others with over 1,270 mentions in the last 24 hours on the popular retail trading thread, according to Swaggy Stocks data on Wednesday.
Just the previous day, SoFi was hovering around 8th position, below Reddit darling AMC entertainment and above Apple.
"This is going to change everything for this company!! I'm loaded 261 april $15 calls," one redditor with the username Slapmyask45 wrote.
The power of retail traders on Reddit to move the market was demonstrated in the meme stock frenzy a year ago, when amateur investors banded together to drive video-game store GameStop's shares higher. They rocketed close to 2,000% in a matter of days.
SoFi stock was up 17% in premarket trading at last check Wednesday, after closing the previous session down 8.6%.
The fintech, which went public via a SPAC merger backed by Chamath Palihapitiya in May last year, said late Tuesday it has been approved by the Federal Reserve, as well as by the Office of the Comptroller of the Currency, as a bank-holding company.
It plans to set up a national bank by buying Golden Pacific Bancorp, which it will operate as a bank subsidiary with the name SoFi bank.
The 10-year-old financial services provider already offers banking products through partnerships with established banks such as Golden Pacific. SoFi expects to be able to improve its delivery of services and increase profits via the deal.
SoFi's shares have fallen more than 23% so far in 2022 as investors' appetite for high-growth tech stocks faded. But interest from WallStreetBets could help it reverse course.
The power of retail traders on Reddit to move the market was demonstrated in the meme stock frenzy a year ago, when amateur investors banded together to drive video-game store GameStop's shares higher. They rocketed close to 2,000% in a matter of days.