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that is/was the whole point of the reddit thing though isn't it? Not betting your house on it but tens of thousands of small investors (there are over 8 million subscribed to that WSB group!) staking a few hundred or thousand that they can afford to lose, which adds up to a huge, market influencing amount overall?
Apparently he thinks the big players have shorted AGAIN.
It would make sense if they had. It's one thing shorting when the stock price is $20. It's quite another if they shorted while the price was $400.
It's pure cult territory in those Reddit threads. The number of desperate posts suggests lots have lost more than they could afford. It just looks like collective madness to me. Let's throw more money at a hugely overvalued stock!
yeah, not denying that, glad it's not my money!!It’s pure cult territory in those Reddit threads.
It was always going to end up as a massive Ponzi style car crash.
As has been pointed out, Cuban gave that advice but doesn't seem to have put a penny of his own money where his mouth is.
WSB is pretty interesting just as a community right now; there's obviously a lot of different user types with different goals, a lot of people who're genuinely happy to lose money on the game, others who absolutely reek of desperation even while going HOLD TEH LINE RETARDS over and over...
I reckon when the dust settles, for individuals it might well be about winning or losing money but the big story is still basically about causing absolute mayhem. I don;t think it's going to "win" in terms of smashing a hedge fund or making that market sufficiently unsafe that it reigns them in... But it obviously rattled the cage to a pretty massive extent. And it'll be really interesting to see the post analysis- how much the dubious blocks on retail trading contributed, and whether the information war stuff gets accepted as fact (especially "reddit buys silver") or whather it's accepted as market manipulation...
TL;DR- lots of people will want to declare a win or a loss but the truth is there's lots of different ways to win or lose.
The thing is the underlying conditions to force a decent short squeeze are still there - the issue is whether the small investors have the patience and nerve to hold on long enough to trigger it. Also how high that squeeze could force the price is a big unknown - I think $1000+/the moon is pretty unrealistic at this point (if HF have got out of half the shorts already and it maxed out at $480 presumably they can keep it to that or less going forward? although that does depend how much time they have to get out of any remaining shorts (that are under something like $50 anyway).
So in theory the small investors still have some control/power but the more of them that panic and sell the less control/power the remaining holders have - hence the repeated calls to hold. It doesn't necessarily mean those screaming to hold are risking losing their shirt it's just they don't want to let the HFs off the hook so easily.
Me personally, if I sell my remaining positions @ $93 I break even from the whole thing and even if it hits $0.01 I'm not losing more than I can afford. However I was hoping it would still be the rollercoaster that last Wednesday and Thursday were where you could make small profits through buying and selling during the multiple dips and bumps that were happening. However this week the stock has been much more stable (albeit on a general downward trend) so it's not worth the risk of playing the rollercoaster if you need to invest $1000 and if you get the timing right you still only profit $20 (even if that's in a short time period).
Mmm, today it's dipped to 85 and risen to 110, still lots of room to make quick gains (and losses!). I think really the problem and the opportunity is now that it's a chaotic illogical stock being acted on by lots of people who have no clue what they're doing, so there's definitely no rational floor or ceiling. Sort of like normal shorting etc or arguably just like the stock market in its entirety, except with added monkeys.
Suppose the irony here is that in messing with short traders, they've created huge opportunities for daytraders to make a quick buck.
Still holding here.
Even if it raises eyebrows with the sec and the US Treasury to highlight how dumb and downright nasty those in Hegde funds are.
I would love to see a forensic accountants dig into some of the big players..
Now imagine if RR for example, currently in the mire but a solid company and employer of huge numbers in the UK it's not impossible to envisage the hedge funds shorting it to death. The odds are slim they would but. there must be some cash strapped international companys in retail,Hospitality ECT who are surviving week by week.
If a company dies a natural death then fine but not from a thousand cuts of hedge fund shorts just pushing numbers on a spreadsheet.
Mmm, today it’s dipped to 85 and risen to 110, still lots of room to make quick gains (and losses!).
Yeah but it's much harder to get the timing right on a 25 point dip/bump than it is on a 100+ point dip/bumps we were seeing last week.
Sure but, point is you were talking about $20 on a $1000 investment- you didn't need to get the timing anything like perfect, to make a much bigger profit than that.
Eh, put it another way- of course the smaller changes have less opportunity but equally you're understating today's opportunities.
After the big crash on Thursday it fell to $126 then less than an hour later it was back up to $282. There just aren't the 100+% swings the last couple of days
That seems to me a bit like asking “is it still stealing if you tell the shop staff you’re stealing and walk out of the shop holding a TV in the air”.
Doesnt really compare. Whether something is manipulation seems to be very messy and where it cuts over into illegal isnt obvious.
From what I have read one of the main factors is honesty.
If I lie about either my holdings or the reasons why someone should invest then its manipulation.
However if I am giving clear and accurate reasons why then it probably isnt.
After all thats what stock market tipsters (and not just the criminal ones) or the professional analysts do every day.
There may be some cases and I assume some investigators are currently reading all the WSB history and so on trying to figure out if anyone did but whether or not it will turn out to be the case is unclear.
Wait, you think that the focus is on WSB for manipulation? I mean, yes some of what's happened on there will blur those lines but against that, it seems pretty plain that this all has its roots in naked shorts, and it seems fairly likely that there's also been a significant volume of counterfeit stock in play. We've seen orchestrated misinformation campaigns against the WSB action- "Reddit loses interest in GME, buys silver" wasn't just completely false, and an attempt to draw retail investors away from the anti-short action, but at the same time some funds were taking positions on silver in an attempt to profit from that misinformation.
So the focus with questions on manipulation and potential criminality is not on someone going APES TOGETHER STRONG on social media.
andrewh
Free MemberAfter the big crash on Thursday it fell to $126 then less than an hour later it was back up to $282. There just aren’t the 100+% swings the last couple of days
Yes, like i say I agree- but that's not what I was taking issue with, only that you were understating the swings/opportunities today.
Seems to be sitting around $100 today. I wonder if it's as simple as people saying, 'If it drops below $100 I'm going to jump in' and others saying, 'If it drops below $100 I'm getting out.'
$100 is a fairly obvious break point if you're dealing primarily with investors who are acting irrationally.
Some other nice psychology like 10% swings with lovely whole numbers, closing at exactly 90 too... like, I was hopelessly drawn to buy at 90, take profit at 100, not because there's anything logical about it but just because it's so tidy.
My brain is crusty and I can't find any info but I remember reading a study from the 70s about how buyer psychology changes noticably at certain sweet spots and one of them is when cash and percentages align in nice ratios- the author didn't make a conclusion as to causes but it always struck me that basically we feel more confident when the numbers look and feel nice in the head. And that was with experienced traders, albeit the markets were very different then- but if even a hardened stock market floor guy can be susceptible to shiny polished numbers then no doubt it could have more impact on confused scared know-nothings. "This number is scary but this number feels nice". Same as pricing stuff at £3.99, or odds disconnects in games of pure chance.
it seems pretty plain that this all has its roots in naked shorts,
It might seem plain but there isnt any supporting evidence for it
First of all a hedge fund would either have to be stupid enough to illegally sell shares or stupid enough to buy pretend shares. Its possible I guess but given there is a perfectly sensible and reasonable explanation it loses out.
What people seem to miss is its perfectly viable to short the same share twice.
The shorted share is sold on the open market and there is no flag on it saying "already shorted dont short again".
So the share can be shorted, brought and then lent out again.
We’ve seen orchestrated misinformation campaigns against the WSB action-
Granted this is interesting but to be expected. People have seen an obvious opportunity and jumped on it. Be curious to see how it plays out in future now the power of being able to trigger a flash mob for finance has become clear.
What people seem to miss is its perfectly viable to short the same share twice.
But in order to cover that short, the holders of the short have to buy the share back from the open market and give it to another party (that now owns the share). The short-holders no longer own the share and in order to cover their second short, another share must be bought again. NB the first sale has caused the share price to increase fractionally (an increase that's multiplied each time a share is bought to cover a short).
So yes it's perfectly possible for the same share to be shorted twice, but all that means is that it's doubly expensive when the time comes to cover.
What people are skeptical of is the reports that the shorts have closed out their positions when there don't appear to be enough shares in the market for that to happen. Some people have done calculations that appear to suggest that there are more shares around than should exist in the GME float. This is a different phenomenon.
So yes it’s perfectly possible for the same share to be shorted twice, but all that means is that it’s doubly expensive when the time comes to cover.
That is assuming the price is not impacted by anything else. It also assumes that the shorts are due at the same time and no further shorting occurs. You would need a lot of guts to try it but shorting at the height of the bubble with a decent length on the contract is liable to be highly profitable.
So whilst there is lots of talk about conspiracy and dirty dealings I have severe doubts. Given profits available when doing something ethically dubious but still legal why bother with the illegal stuff?
More profit?
Steve thinks fraud is worth it. And tbf it is for him he is apparently only worth 7bilon
Cohen's firm -- then known as SAC Capital Advisors -- agreed in November 2013 to plead guilty to securities and wire fraud, pay $1.8 billion in fines and forfeitures, and stop managing money for outside investors.
According to Bloomberg News reporting in April 2018, Cohen pulled out close to $3 billion from Point72 Asset Management for taxes. He raised about $10 billion in the three years after re-opening to outside clients in 2018 following a Securities and Exchange Commission ban. *
dissonance
Full MemberIt might seem plain but there isnt any supporting evidence for it
The level of fail-to-delivers certainly seems to support it, and that's a pretty well accepted indicator for naked shorting (which I'm sure you agree, despite being illegal, still happens). It's mathematically possible that it could all be accounted for by innocent double-lending which is one of the reasons people can still do it with relative impunity, but that does not seem the most obvious explanation when at the same time you had a short going wrong, massive incentive to look for solutions... and as far as I can see no other explanation for the trends?
dissonance
Full MemberSo whilst there is lots of talk about conspiracy and dirty dealings I have severe doubts. Given profits available when doing something ethically dubious but still legal why bother with the illegal stuff?
I would think that's obvious tbf. When they started the short, it was all business as usual. But the action you take when the wheels come off may be very different from anything you planned to do. I mean, equally they clearly didn't plan to be having to take money from Citadel etc.
And why do a naked short in the first place? Because it's hard to prove, and the regulator is pretty toothless/unconcerned, and even if you forget it's illegal and get caught like Morgan Stanley you get a trivial slap on the wrists fine that is far less than the potential profits.
Friday (when his portfolio was at ~$53M) he cashed out around $9M of the options IIRC.
Fair play to him for only realising 9m, but I would've chucked the whole lot and bollocks to WSB philosophy. Could do a far greater amount of good with that cash than will ever be realised by the reddit forumites will ever achieve.
So whilst there is lots of talk about conspiracy and dirty dealings I have severe doubts. Given profits available when doing something ethically dubious but still legal why bother with the illegal stuff?
From what I understand from this scenario, the punishment from being caught will likely be less than the losses some hedge funds stand to incur.
Just heard from my sister-in-law again. Turns out my nephew didn't hold and got out when his gains hit a million. Thank god for that, I was getting a bit worried he was one of the hold forever types on WSB.
Good lad !!
Once in a lifetime opportunity well taken, don't let him think he'll beat the market/world ever again like that. So....
Porsche, just do it
A load into a pension (subject to upper limits) and never have to worry about that ever again.
3 bedder
Job done
(tax bill is going to smart though)
Fair play to him for only realising 9m, but I would’ve chucked the whole lot and bollocks to WSB philosophy. Could do a far greater amount of good with that cash than will ever be realised by the reddit forumites will ever achieve.
Yeah, I don't think I'd have held @$53M although I think he's continuing because he believes it'll go up again. He's already 'won' and made more money than most of us dream of, so why not try for the moonshot? I actually went back and looked at some of his YouTube videos (u/RoaringKitty) and he seems like a big brain kind of guy who's out to make money, not some Robin Hood wealth redistribution evangelical.
tax bill is going to smart though
I don't know for a fact but he may well have been trading within an ISA 🙂
Once in a lifetime opportunity well taken, don’t let him think he’ll beat the market/world ever again like that
Very true. I'm hoping he's not one of the types who think they have some god-given talent rather than just blind luck. He's very sensible in all other respects though so doubt he'll do anythng stupid.
tumbling now!!
Any bets on the new bottom? So tempted to buy more at $70ish and hope they bounce back 20-30 points by the end of the day - not going to risk it though I don't think...
Love the way you think a "point" is actually a "big figure"
Be careful catching a falling knife
New bottom = whatever they were trading at before they lost touch with reality, back when you'd never heard of them.
Love the way you think a “point” is actually a “big figure”
Love the way you assume to know what I'm thinking!?
So did you sellout at your break even price of $93 Fuzzy or are you sitting on a loss now?
Sitting on a loss now - most I can lose (if they hit $0) is $310, if I cashed out right now @ $63 I'd end up down $90 overall.
I can't see it recovering significantly any time soon though so have a SL @ $50 on half of it and going to ride the rest down to the bottom and will hold to see what the market decides is the real value in a month or two! But yeah def not going to put an other $1000 back in hoping for a boost in the next day or two
the rocketship might be grounded but there's still drama on the reddit thread! Talk of long-gone mods who still hold top privileges coming back to capitalise on press interest, Netflix movie etc!
Now trading at $59.50, down 35.5% on the day so far; appears that the correction is well underway.
dfv might be in the shit, I figured something was occurring after he said he was going to stop the YOLO updates, he's been posting for ages about it though with little following,
the $BLIAC thread was interesting though, went up 39% by EOD
They're up 50% so far today, not sure I understand why - there's a lot of volume being traded. Might just be an early blip before another dip, I'm too chicken to risk it :p
Robinhood removed limits
It’s bonkers!
I wasted some more time in the Reddit forums to get to the heart of the madness. My god... 🤯
not sure I understand why
Dead Cat Bounce
I wasted some more time in the Reddit forums to get to the heart of the madness. My god… 🤯
💎💎💎💎💎💎🙌🙌🙌🙌🙌🚀🚀🚀🚀🚀🚀🚀🚀
It's done. The Hegde funds will keep playing pass the parcel and the one who holds the unlucky bag will go bankrupt/get fined and be back trading in 3 years.
I'm taking mine to the grave.
And to the young lad who made a million kudos Billy big balls