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Here's Why Skillz Shares Rose 16.5% Today

What happened

Shares of Skillz (NYSE: SKLZ) closed Monday's trading session 16.5% higher. Cathie Wood's ARK Invest got the ball rolling by disclosing that the fund bought more Skillz shares on Friday, giving the stock momentum over the weekend. Skillz CEO Andrew Paradise amplified the gains with an interview on CNBC on Monday afternoon.

So what

ARK bought more than 1.2 million shares of the mobile gaming specialist on Thursday, bringing the fund's total Skills shares to more than 7 million. Wood added a few thousand more shares on Friday for good measure. This stock now accounts for 1.2% of ARK's invested assets. Skillz gained 9.7% that day, and the upward momentum continued this morning.

This afternoon, Paradise took part in a CNBC interview with a bullish attitude. He said that he is excited about Cathie Wood's interest in Skillz and that the get-paid-for-playing platform should remain popular as America and the world reopen as the pandemic ends. These comments drove the stock dramatically higher near the closing bell.

Image source: Getty Images.

Now what

Paradise also argued that short-sellers "just don't understand our business" and that their recent batch of negative claims was "flawed."

The young company is off to a rocky but headline-grabbing start. Share prices have now more than doubled since last summer's SPAC-style initial public offering. It's easy to see why noted growth investor Wood has a keen interest in this hot stock, but the heavy short-seller bets also make sense. Skillz is a highly volatile ticker, and that's not changing anytime soon.

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Anders Bylund has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Skillz Inc. The Motley Fool has a disclosure policy.


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