Meme stock frenzy not entirely driven by retail traders: Virtu CEO Cifu

The frenzied exercise involving so-known as meme stocks is staying pushed by far more than just retail buyers, the CEO of marketplace maker Virtu Money instructed CNBC on Wednesday.

“You will find a whole lot of institutions, qualified traders, speculators, whatever you want to phone them, engaged in this in both equally the funds equities current market and the options marketplace,” Virtu’s Doug Cifu said on “Electricity Lunch.” “This is not only a band of retail traders trading these shares,” he extra.

Cifu’s comments arrive as the spotlight has returned to meme shares that are well known on online boards this sort of as Reddit. While the saga commenced in January, with GameStop then serving as the most well known illustration, retail traders have broadened their focus to other securities.

AMC Entertainment has recently been a favorite on Reddit boards and, quite recently, Clover Well being and Clean up Power Fuels have attracted consideration.

Clover Health and fitness entered Wednesday’s session up extra than 140% so significantly this week on your own. Having said that, even with an initial pop to begin the trading working day, Clover Well being shut down 23.6%.

Clear Energy Fuels soared more than 30% Wednesday.

Reddit traders have seemed for shares with sizable quick positions, shopping for shares and call selections in an try to drive up the price.

“They’re heading for everything. … You have to try to figure out which just one is upcoming,” CNBC’s Jim Cramer said previously Wednesday, though likening the meme-inventory trend to gambling, not just investing.

Cifu also co-started Virtu in 2008, and the New York-based mostly financial agency has grow to be a person of the world’s most significant market makers, which engage in a essential function in executing inventory trades.

“We have two sides to our enterprise. We have a retail business and an institutional company. It ought to not be missing on individuals: This is not entirely a retail phenomena,” Cifu stated, referring to the meme shares.

“We want to make guaranteed that there’s correct acceptable, folks basically know what they’re carrying out and they get whole transparency,” he extra. “But otherwise, that’s what marketplaces are below for, and they’re working pretty nicely.”