GameStop stock jumps for a second day with other ‘meme stocks.’

Shares of GameStop surged again on Thursday, in the second straight day of volatile trading for the video game retailer that was at the center of a trading frenzy last month.

On Wednesday, GameStop’s shares doubled to $91.71, and the volume of trading was more than 10 times the level of the previous day. By early Thursday afternoon, the shares had doubled again in heavy trading, to nearly $185, before tumbling late. The stock still closed up nearly 19 percent, at $108.73.

As GameStop got off to a hot start, some of the popular posts on Reddit’s Wall Street Bets forum, where users stoked last month’s wild rally, read “ROUND 2!” and “THE COMEBACK!!!!!”

Other stocks that recently captured the internet’s attention also rose in early trading before giving up gains: Shares of AMC Entertainment gained 21 percent shortly after the open and the headphone maker Koss was up about 90 percent. But shares of the movie theater company closed down 8.8 percent, and Koss gave up most of its gains, rising just 17 percent for the day.

The two-day surge by GameStop again made it the center of the market’s attention, just a few weeks after a remarkable rally in so-called meme stocks that created vast on-paper wealth for many small traders, and even made some into millionaires if they sold high. Some notable hedge funds that had bet against the stocks suffered painful losses during the rally, which ended almost as quickly as it began — and left many retail investors with substantial losses if they got in late.

Last month’s rally had a certain logic: retail traders pouring into a small stock to squeeze the hedge funds that were shorting it, generating giant gains and even more buying. But no one knew exactly what resuscitated the frenetic trading in GameStop this week.

One reason could be the departure of the struggling video game retailer’s chief financial officer, in a move announced earlier this week, market analysts said. Others traced the start of the rise to a Twitter post on Wednesday by the GameStop board member and activist investor Ryan Cohen. But it was unclear why the post — a text-free photograph of a McDonald’s soft-serve ice cream cone — would have been seen as a signal to buy.

Other analysts saw a connection to some unusual activity in the options market late in the day on Wednesday, when there were a few larger-than-typical purchases of GameStop call options — bets that the stock price would rise sharply.

Those purchases may have forced the dealers that sold the options to buy shares. This is a normal maneuver dealers make to hedge their positions, and as the popularity of trading options has exploded over the past year, some analysts have pointed to that dynamic as exacerbating the volatility of markets.

Some analysts posited that late-day options purchases helped explain the surge of trading in the stock toward the close of trading on Wednesday, as well as during the aftermarket session, when at times GameStop was up another 100 percent.

“Whoever sold those calls simply did not have enough time to cover their risks in the regular session, and may have felt it prudent to do so after the close,” said Steve Sosnick, chief strategist at Interactive Brokers in Greenwich, Conn.

Couple that with the already heightened interest in GameStop, he said, and you have the makings of a rally.

“GME was on everyone’s radar,” Mr. Sosnick said, “so that brought out another crop of speculators.”

By The New YorK Times