AIG’s stock has become the hottest commodity on Wall Street in recent weeks, the Wall Street Journal reports. It’s not that anyone believes the insurer is on the verge of paying back the $80 billion it owes Uncle Sam. Rather, the stock has become the go-to casino for day traders. In the past seven weeks its stock has swung between $13 and $55, before closing at $45.80 yesterday.
At times, trading volume has topped 130 million shares, which amounts to nearly every outstanding share. “It’s on every trader’s radar screen across the country,” said the head of one trading firm. AIG set the scene for the frenzy with a reverse stock split, which turned every 20 $1 shares into one $20 share. That drew trader interest and, because almost all long-term investors had long fled the stock, volatility was predictably outrageous.