Reddit Pumps and Dumps RGTI

January 8, 4:55 pm

At AltIndex, we specialize in tracking alternative data insights such as Reddit mentions and sentiment, and their correlation with stock performance for thousands of publicly traded companies. A recent analyze on Rigetti Computing (RGTI) highlights the power of these insights and the risks associated with Reddit-driven stock movements.

The Reddit Hype

In December, we began sending out alerts to our members, noting a significant spike in Reddit mentions for Rigetti Computing and its stock RGTI. Quantum computing stocks were gaining traction on investing subreddits, and Rigetti emerged as one of the most discussed stocks. The chart below illustrates the trends in Reddit mentions, sentiment, and price for Rigetti over the past month.

Initially, the sentiment around Rigetti was overwhelmingly bullish, as comments focused on the potential of quantum stocks. This coincided with a sharp rise in the stock price, which jumped by over 200% within a matter of days. The Reddit crowd seemed to hype up the potential of quantum computing, driving significant interest and speculation around Rigetti Computing.

The Pump and Dump Effect

While Reddit mentions remained steady in the following days, sentiment started to decline, and today Rigetti's stock price plummeted by 45%, marking a stark reversal from its new highs. This dramatic drop underscores the influence of Reddit-driven trading, which likely contributed to the pump-and-dump dynamics observed in this case.

Our chart highlights how Reddit mentions spiked first, followed by a surge in bullish sentiment and a corresponding price increase. However, as sentiment waned, the stock’s price began to decline, culminating in today’s massive drop.

Lessons for Investors

Rigetti Computing's journey over the past month is a prime example of why investors must stay informed about alternative data sources like Reddit. The stock's volatility underscores the risks and opportunities associated with Reddit-driven trends. By monitoring Reddit mentions and sentiment in real-time, investors can better identify potential opportunities - and risks - before they manifest in the market.

At AltIndex, we provide our members with timely alerts and insights into the latest trends on Reddit and other social media platforms. Staying in the know about what’s happening on Reddit is crucial for identifying potential winners, jumping on quick trends, and avoiding the pitfalls of when a stock gets dumped.

Final Thoughts

Rigetti Computing’s recent price action serves as a reminder of the power of retail investors and online communities in shaping stock movements. For those who wish to capitalize on these trends, having access to actionable insights from alternative data sources is not just an advantage - it’s a necessity.

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