Gamma Squeeze
Also called: gamma squeeze meaning, dealer gamma
A gamma squeeze is a feedback loop in which heavy call buying forces dealers to hedge by buying the underlying, pushing the price up and forcing them to buy still more. It's mechanical rather than sentimental: the dealer is short gamma and must chase. Combined with a small free float and a crowded short base, it produces the violent, fundamentals-free rallies seen in meme stocks — and unwinds just as fast when the options expire.
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