Glossary Detail: Gamma Squeeze
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Backtesting Gamma Squeeze on High-Beta Names
Self-reinforcing price rally driven by market-maker hedging — as calls go ITM, dealers buy more stock, pushing price higher, triggering more buying.
Further Details:
A gamma squeeze occurs when rapid stock price movement forces market makers to aggressively buy (or sell) shares to maintain their delta hedge, which in turn amplifies the price movement, forcing more hedging. It's a positive feedback loop driven by market maker mechanics.