Daily Advice Thread - All basic help or advice questions must be posted here. Investing |
- Daily Advice Thread - All basic help or advice questions must be posted here.
- Robinhood and other brokers literally blocking purchase of $GME, $NOK, $BB, $AMC; allow sells
- Robinhood will allow limited buying of restricted securities Friday, GameStop jumps after hours
- Gamestop Big Picture: The Short Singularity Pt 3 - WTF edition
- What stocks are you looking to grab at a possible discount?
- Gamestop Big Picture: The Short Singularity Pt 2
- Facebook now trading at only a forward P/E of 20.5
- Unusual after hours volume on $FNMA & $FMCC?
- I'd like to discuss the green energy executive orders Biden signed yesterday and its impacts on the market.
- I would like to point a portion of my portfolio at commodities like copper oil lithium silver gold etc. in expectation of a possible commodity supercycle during stagflation/reinflation.
- Update: filtering is still at "all posts", we will likely keep things that way for a bit - announcement inside
- Lunch with Levine doing an IG chat live at 13:30
- For anybody wondering about CD Projekt (7CD) skyrocketing today
- RKT getting ready for lift off
- An unanswerable investing question
- Walmart Announces Vision for Its Media Business!
- Reasons why CCIV might be the stock of 2021
| Daily Advice Thread - All basic help or advice questions must be posted here. Posted: 29 Jan 2021 02:00 AM PST If your question is "I have $10,000, what do I do?" or other "advice for my personal situation" questions, you should include relevant information, such as the following:
Please consider consulting our FAQ first - https://www.reddit.com/r/investing/wiki/faq And our side bar also has useful resources. Be aware that these answers are just opinions of Redditors and should be used as a starting point for your research. You should strongly consider seeing a registered financial rep before making any financial decisions! [link] [comments]  | ||||||||||||||||||
| Robinhood and other brokers literally blocking purchase of $GME, $NOK, $BB, $AMC; allow sells Posted: 28 Jan 2021 05:42 AM PST See title. Can't buy these stocks on RH, but can sell. What the hell is this? How is this legal? [link] [comments]  | ||||||||||||||||||
| Robinhood will allow limited buying of restricted securities Friday, GameStop jumps after hours Posted: 28 Jan 2021 01:38 PM PST
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| Gamestop Big Picture: The Short Singularity Pt 3 - WTF edition Posted: 29 Jan 2021 03:46 AM PST Disclaimer: I am not a financial advisor. This entire post represents my personal views and opinions, and should not be taken as financial advice (or advice of any kind whatsoever). I encourage you to do your own research, take anything I write with a grain of salt, and hold me accountable for any mistakes you may catch. Also, full disclosure, I hold a net long position in GME, but my cost basis is very low (average ~$67--I have to admit, the drop today was too tasty so my cost basis went up from yesterday)/share with my later buys averaged in), and I'm using money I can absolutely lose. My capital at risk and tolerance for risk generally is likely substantially different than yours. In this post I will go a little further and speculate more than I'd normally do in a post due to the questions I've been getting, so fair warning, some of it might be very wrong. I suspect we'll learn some of the truth years from now when some investigative journalist writes a book about it. Thank you everyone for the comments and questions on the first and second post on this topic. Today was a study in the power of fear, courage, and the levers you can pull when you wield billions of dollars... Woops, excuse me. I'm sorry hedge fund guys... I meant trillions of dollars--I just briefly forget you control not just your own but a lot of other peoples' money too for a moment there. Also, for people still trading this on market-based rationale (as I am), it was a good day to measure the conviction behind your thesis. I like to think I have conviction, but in case you are somehow not yet familiar with the legend of DFV, you need to see these posts (fair warning, nsfw, and some may be offended/triggered by the crude language). The last two posts might be impressive, but you should follow it in chronological order and pay attention to the evolution of sentiment in the comments to experience true enlightenment. Anyway, I apologize, but this post will be very long--there's just a lot to unpack. Pre-MarketDisclaimer: given yesterday's pre-market action I didn't even pay attention to the screen until near retail pre-market. I'm less confident in my ability to read what's going on in a historical chart vs the feel I get watching live, but I'll try. Early in the pre-market it looks to me like some momentum traders are taking profit, discounting the probability that the short-side will give them a deep discount later, which you can reasonably assume given the strategy they ran yesterday. If they're right they can sell some small volume into the pre-market top, wait for the hedge funds try to run the price back down, and then lever up the gains even higher buying the dip. Buy-side here look to me like people FOMOing and YOLOing in at any price to grab their slice of gainz, or what looks to be market history in the making. No way are short-side hedge funds trying to cover anything at these prices. Mark Cuban--well said! Free markets baby! Mohamed El-Erian is money in the bank as always. "upgrade in quality" on the pandemic drop was the best, clearest actionable call while most were at peak panic, and boy did it print. Your identifying the bubble as the excessive short (vs blaming retail activity) is money yet again. Also, The PAIN TRADE (sorry, later interview segment I only have on DVR, couldn't find on youtube--maybe someone else can)! The short attack starts, but I'm hoping no one was panicking this time--we've seen it before. Looks like the momentum guys are minting money buying the double dip into market open. CNBC, please get a good market technician to explain the market action. Buy-side dominance, sell-side share availability evaporating into nothing (look at day-by-day volume last few days), this thing is now at runaway supercritical mass. There is no changing the trajectory unless you can change the very fabric of the market and the rules behind it (woops, I guess I should have knocked on wood there). If you know the mechanics, what's happening in the market with GME is not mysterious AT ALL. I feel like you guys are trying to scare retail out early "for their own good" (with all sincerity, to your credit) rather than explain what's happening. Possibly you also fear that explaining it would equate to enabling/encouraging people to keep trying to do it inappropriately (possibly fair point, but at least come out and say that if that's the case). Outside the market, however...wow. You Thought Yesterday Was Fear? THIS is Fear!Ok short-side people, my hat is off to you. Just when I thought shouting fire in a locked theater was fear mongering poetry in motion, you went and took it to 11. What's even better? Yelling fire in a theater with only one exit. That way people can cause the financial equivalent of stampede casualties. Absolutely brilliant. Robin Hood disables buying of GME, AMC, and a few of the other WSB favorites. Other brokerages do the same. Even for people on 0% margin. Man, and here I thought I had seen it all yesterday. Side note: I will give a shout out to TD Ameritrade. You guys got erroneously lumped together with RH during an early CNBC segment, but you telegraphed the volatility risk management changes and gradually ramped up margin requirements over the past week. No one on your platform should have been surprised if they were paying attention. And you didn't stop anyone from trading their own money at any point in time. My account balance thanks you. I heard others may have had problems, but I'll give you the benefit of the doubt given the DDOS attacks that were flyiing around Robin Hood. Seriously WTF. I'm sure it was TOTALLY coincidence that your big announcements happen almost precisely when what has to be one of the best and most aggressive short ladder attacks of all time starts painting the tape, what looked like a DDOS attack on Reddit's CDN infrastructure (pretty certain it was the CDN because other stuff got taken out at the same time too), and a flood of bots hit social media (ok, short-side, this last one is getting old). Taking out a large-scale cloud CDN is real big boy stuff though, so I wouldn't entirely rule out nation state type action--those guys are good at sniffing out opportunities to foment social unrest. Anyway, at this point, as the market dives, I have to admit I was worried for a moment. Not that somehow the short-side would win (hah! the long-side whales in the pond know what's up), but that a lot of retail would get hurt in the action. That concern subsided quite a bit on the third halt on that slide. But first... A side lesson on market orders Someone printed bonus bank big time (and someone lost--I feel your pain, whoever you are). During the face-ripping volatility my play money account briefly ascended to rarified heights of 7 figures. It took me a second to realize it, then another second to process it. Then, as soon as it clicked, that one, glorious moment in time was gone. What happened? During the insane chop of the short ladder attack, someone decided to sweep the 29 Jan 21 115 Call contracts, but they couldn't get a grip on the price, which was going coast to coast as IV blew up and the price was being slammed around. So whoever was trying to buy said "F it, MARKET ORDER" (i.e. buy up to $X,XXX,XXX worth of contracts at any price). This is referred to as a sweep if funded to buy all/most of the contracts on offer (HFT shops snipe every contract at each specific price with a shotgun of limit orders, which is far safer, but something only near-market compute resources can do really well). For retail, or old-tech pros, if you want all the contracts quickly, you drop a market order loaded with big bucks and see what you get... BUT, some clever shark had contracts available for the reasonable sum of... $4,400, or something around that. I was too stunned to grab a screencap. The buy market order swept the book clean and ran right into that glorious, nigh-obscene backstop limit. So someone got nearly $440,000 PER CONTRACT that was, at the time theoretically priced at around $15,000. $425,000 loss... PER CONTRACT. Maybe I'm not giving the buyer enough credit.. you can get sniped like that even if you try to do a safety check of the order book first, but, especially in low liquidity environments, if a HFT can peak into your order flow (or maybe just observes a high volume of sweeps occurring), they can end up front running your sweep, pick off the reasonable contracts, and slam a ridiculous limit sell order into place before your order makes it to the exchange. Either way, I hope that sweep wasn't loaded for bear into the millions. If so... OUCH. Someone got cleaned out. So, the lesson here folks... in a super high volatility, low-liquidity market, a market order will just run up the ladder into the first sell order it can find, and some very brutal people will put limit sells like that out there just in case they hit the jackpot. And someone did. If you're on the winning side, great. It can basically bankrupt you if you're on the losing side. My recommendation: Just don't try it. I wouldn't be surprised if really shady shenanigans were involved in this, but no way to know (normally that's crazy-type talk, but after today....peeking at order flow and sniping sweeps is one of the fastest, most financially devastating ways to bleed big long-side players, just sayin'). Back to the market action.. A Ray of Light Through the DarknessSo I was worried watching the crazy downward movement for two different reasons. On the one hand, I was worried the momentum pros would get the best discounts on the dip (I'll admit, I FOMO'd in too early, unnecessarily raising my cost basis). On the other hand, I was worried for the retail people on Robin Hood who might be bailing out into incredibly steep losses because they had only two options: Watch the slide, or bail. All while dealing with what looked to me like a broad-based cloud CDN outage as they tried to get info from WSB HQ, and wondering if the insta-flood of bot messages were actually real people this time, and that everyone else was bailing on them to leave them holding the bag. But I saw the retail flag flying high on the 3rd market halt (IIRC), and I knew most would be ok. What did I see, you ask? Why, the glorious $211.00 / $5,000 bid/ask spread. WSB Reddit is down? Those crazy mofos give you the finger right on the ticker tape. I've been asked many times in the last few hours about why I was so sure shorts weren't covering on the down move. THIS is how I knew. For sure. It's in the market data itself. I'll admit, I tried to one-up those bros with a 4206.90 limit sell order, but it never made it through. I'm impressed that the HFT guys at the hedge fund must have realized really quickly what a morale booster that kind of thing would have been, and kept a lower backstop ask in place almost continuously from then on I'm sure others tried the same thing. Occasionally $1,000 and other high-dollar asks would peak through from time to time from then on, which told me the long-side HFTs were probably successfully sniping the backstops regularly. So, translating for those of you who found that confusing. First, such a high ask is basically a FU to the short-side (who, as you remember, need to eventually buy shares to cover their short positions). More importantly, as an indicator of retail sentiment, it meant that NO ONE ELSE WAS TRYING TO SELL AT ANY PRICE LOWER THAN $5,000. Absolutely no one was bailing out. I laughed for a minute, then started getting a little worried. Holy cow.. NO retail selling into the fear? How are they resisting that kind of price move?? The answer, as we all know now... they weren't afraid... they weren't even worried. They were F*CKING PISSED. Meanwhile the momentum guys and long-side HFTs keep gobbling up the generously donated shares that the short-side are plowing into their ladder attack. Lots of HFT duels going on as long-side HFTs try to intercept shares meant to travel between short-side HFT accounts for their ladder. You can tell when you see prices like $227.0001 constantly flying across the tape. Retail can't even attempt to enter an order like that--those are for the big boys with privileged low-latency access. The fact that you can even see that on the tape with human eyes is really bad for the short-side people. Why, you ask? Because it means liquidity is drying up, and fast. The Liquidity Tide is Flowing Out Quickly. Who's Naked (short)?Market technicals time. I still wish this sub would allow pictures so I could throw up a chart, but I guess a table will do fine.
What do I see? I see the shares available to trade dropping so fast that all the near-exchange compute power in the world won't let the short-side HFTs maintain order flow volume for their attacks. Many retail people asking me questions thought today was the heaviest trading. Nope--it was just the craziest. What about the price dropping on Thursday? Is that a sign that the short-side pulled a miracle out and pushed price down against a parabolic move on even less volume than Wednesday? Is the long side running out of capital? Nope. It means the short-side hedge funds are just about finished. But wait, I thought the price needed to be higher for them to be taken out? How is it that price being lower is bad for them? Won't that allow them to cover at a lower price? No, the volume is so low that they can't cover any meaningful fraction of their position without spiking the price parabolic almost instantly. Just not enough shares on offer at reasonable prices (especially when WSB keeps flashing you 6942.00s). It's true, a higher price hurts, but the interest charge for one more day is just noise at this point. The only tick that will REALLY count is the last tick of trading on Friday. In the meantime, the price drop (and watching the sparring in real time) tells me that the long-side whales and their HFT quants are so certain of the squeeze that they're no longer worried AT ALL about whether it will happen, and they aren't even worried at all about retail morale to help carry the water anymore. Instead, they're now really, really worried about how CHEAPLY they can make it happen. They are wondering if they can't edge out just a sliver more alpha out of what will already be a blow-out trade for the history books (probably). You see, to make it happen they just have to keep hoovering up shares. It doesn't matter what those shares cost. If you're certain that the squeeze is now locked in, why push the price up and pay more than you have to? Just keep pressing hard enough to force short-side to keep sending those tasty shares your way, but not so much you move the price. Short-side realizes this and doesn't try to drive price down too aggressively. They can't afford to let price run away, so they have to keep some pressure on at the lowest volume they can manage, but they don't want to push down too hard and give the long-side HFTs too deep of a discount and bleed their ammo out even faster. That dynamic keeps price within a narrow (for GME today, anyway) trading range for the rest of the day into the close. Good plan guys, but those after market people are pushing the price up again. Damnit WSB bros and Euros, you're costing those poor long-side whales their extra 0.0000001% of alpha on this trade just so you can run up your green rockets... See, that's the kind of nonsense that just validates Lee Cooperman's concerns. On a totally unrelated note, I have to say that I appreciate the shift in CNBC's reporting. Much more thoughtful and informed. Just please get a good market technician in there who will be willing to talk about what is going on under the hood if possible. A lot of people watching on the sidelines are far more terrified than they need to be because it all looks random to them. And they're worried that you guys look confused and worried--and if the experts on the news are worried....??! You should be able to find one who has access to the really good data that we retailers can only guess at, who can explain it to us unwashed masses. Ok, So.. QuestionsThere is no market justification for this. How can you tell me is this fundamentally sound and not just straight throwing money away irresponsibly?? (side note: not that that should matter--if you want to throw your money away why shouldn't you be allowed to?) We're not trading in your securities pricing model. This isn't irrational just because your model says long and short positions are the same thing. The model is not a real market. There is asymmetrical counterparty risk here given the shorts are on the hook for all the money they have, and possibly all the money their brokers have, and possibly anyone with exposure to the broker too! You may want people to trade by the rules you want them to follow. But the rest of us trade in the real market as it is actually implemented. Remember? That's what you tell the retailers who take their accounts to zero. Remember what you told the KBIO short-squeezed people? They had fair warning that short positions carry infinite risk, including more than your initial investment. You guys know this. It's literally part of your job to know this. But-but-the systemic risk!! This is Madness! ...Madness? THIS. IS. THE MARKET!!! *Retail kicks the short-side hedge funds down an infinity loss black hole\*. Ok, seriously though, that is actually a fundamentally sound, and properly profit-driven answer at least as justifiable as the hedge funds' justification for going >100% of float short. If they can be allowed to gamble INFINITE LOSSES because they expect to make profit on the possibility the company goes bankrupt, can't others do the inverse on the possibility the company I don't know.. doesn't go bankrupt and gets a better strategy from the team that created what is now a $43bn market cap company (CHWY) that does exactly some of the things GME needs to do (digital revenue growth) maybe? I mean, I first bought in on that fundamental value thesis in the 30s and then upped my cost basis given the asymmetry of risk in the technical analysis as an obvious no-brainer momentum trade. The squeeze is just, as WSB people might say, tendies raining down from on high as an added bonus. I get that you disagree on the fundamental viability of GME. Great. Isn't that what makes a market? Regarding the consequences of a squeeze, in practice my expectation was maybe at worst some kind of ex-market settlement after liquidation of the funds with exposure to keep things nice and orderly for the rest of the market. I mean, they handled the VW thing somehow right? I see now that I just underestimated elite hedge fund managers though--those guys are so hardcore (I'll explain why I think so a bit lower down). If hedge fund people are so hardcore, how did the retail long side ever have a chance of winning this squeeze trade they're talking about? Because it's an asymmetrical battle once you have short interest cornered. And the risk is also crazily asymmetrical in favor of the long side if short interest is what it is in GME. In fact, the hedge funds essentially cornered themselves without anyone even doing anything. They just dug themselves right in there. Kind of impressive really, in a weird way. What does the short side need to cover? They need the price to be low, and they need to buy shares. How does price move lower? You have to push share volume such that supply overwhelms demand and price therefore goes down (man, I knew econ 101 would come in handy someday). But wait... if you have to sell shares to push the price down.. won't you just undo all your work when you have to buy it back to actually cover? The trick is you have to push price down so hard, so fast, so unpredictably, that you SCARE OTHER PEOPLE into selling their shares too, because they're scared of taking losses. Their sales help push the price down for free! and then you scoop them up at discount price! Also, there are ways to make people scared other than price movement and fear of losses, when you get right down to it. So, you know, you just need to get really, really, really good at making people scared. Remember to add a line item to your budget to make sure you can really do it right. On the other hand.. What does the long side need to do? They need to own as much of the shares as they can get their hands on. And then they need to hold on to them. They can't be weak hands either. They need to be hands that will hold even under the most intense heat of battle, and the immense pressure of mind-numbing fear... they need to be as if they were made of... diamond... (oh wow, maybe those WSB people kind of have a point here). Why does this matter? Because at some point the sell side will eventually run out of shares to borrow. They simply won't be there, because they'll be safely tucked away in the long-side's accounts. Once you run out of shares to borrow and sell, you have no way to move the price anymore. You can't just drop a fat stack--excuse me, I mean suitcase (we're talking hedge fund money here after all)--of Benjamins on the ticker tape directly. Only shares. No more shares, no way to have any direct effect on the price whatsoever. Ok, doesn't that just mean trading stops? Can't you just out-wait the long side then? Well, you could.. until someone on the long side puts 1 share up on a 69420 ask, and an even crazier person actually buys at that price on the last tick on a Friday. Let's just say it gets really bad at that point. Ok.. but how do the retail people actually get paid? Well, to be quite honest, it's entirely up to each of them individually. You've seen the volumes being thrown around the past week+. I guarantee you every single retailer out there could have printed money multiple times trading that flow. If they choose to, and time it well. Or they could lose it all--this is the market. Some of them apparently seem to have some plan, or an implicit trust in certain individuals to help them know when to punch out. Maybe it works out, but maybe not. There will be financial casualties on the field for sure--this is the bare-knuckled capitalist jungle after all, remember? But everyone ponied up to the table with their own money somehow, so they all get to play in the big leagues just like everyone else. In theory, anyway. And now, Probably the #1 question I've been asked on all of these posts has been: So what happens next? Do we get the infinity squeeze? Do the hedge funds go down? Great questions. I don't know. No one does. That's what I've said every time, but I get that's a frustrating answer, so I'll write a bit more and speculate further. Please again understand these are my opinions with a degree of speculation I wouldn't normally put in a post. The Market and the Economy. Main Street, Wall Street, and WashingtonThe pandemic has hurt so many people that it's hard to comprehend. Honestly, I don't even pretend to be able to. I have been crazy fortunate enough to almost not be affected at all. Honestly, it is a little unnerving to me how great the disconnect is between people who are doing fine (or better than fine, looking at my IRA) versus the people who are on the opposite side of the ever-widening divide that, let's be honest, has been growing wider since long before the pandemic. People on the other side--who have been told they cannot work even if they want to, who wonder if congress will get it together to at least keep them from getting thrown out of their house if they have to keep taking one for the team for the good of all, are wondering if they're even living in the same reality. Because all they see on the news each day is that the stock market is at record highs, or some amazing tech stocks have 10x'd in the last 6 months. How can that be happening during a pandemic? Because The Market is not The Economy. The Market looks forward to that brighter future that Economy types just need to wait for. Don't worry--it'll be here sometime before the end of the year. We think. We're making money on that assumption right now, anyway. Oh, by the way, if you're in The Market, you get to get richer as a minor, unearned side-effect of the solutions our governments have come up with to fight the pandemic. Wow. That sounds amazing. How do I get to part of that world? Retail fintech, baby. Physical assets like real estate might be a bit out of reach at the moment, but stocks will do. I can even buy fractional shares of BRK/A LOL. Finally, I can trade for my own slice of heaven, watching that balance go up (and up--go stonks!!). Now I too get to dream the dream. I get to feel connected to that mythical world, The Market, rather than being stuck in the plain old Economy. Sure, I might blow up my account, but that's because it's the jungle. Bare-knuckled, big league capitalism going on right here, and at least I get to show up an put my shares on the table with everyone else. At least I'm playing the same game. Everyone has to start somewhere--at least now I get to start, even if I have to learn my lesson by zeroing my account a few times. I've basically had to deal with what felt like my life zeroing out a few times before. This is number on a screen going to 0 is nothing. Laugh or cry, right? I'll post my losses on WSB and at least get some laughs. Geez, some of the people here are making bank. I better learn from them and see if they'll let me in on their trades. Wow... this actually might work. I don't understand yet, but I trust these guys telling me to hold onto this crazy trade. I don't understand it, but all the memes say it's going to be big. ...WOW... I can pay off my credit card with this number. Do I punch out now? No? Hold?... Ok, getting nervous watching the number go down but I trust you freaks. We're still in the jungle, but at least I'm in with with my posse now. Market open tomorrow--we ride the rocket baby! And if it goes down, at least I'm going down with my crew. At least if that happens the memes will be so hilarious I'll forget to cry. Wow.. I can't believe it... we might actually pull this off. Laugh at us now, "pros"! We're in The Market now, and Market rules tell us what is going to happen. We're getting all that hedge fund money Right? Right? Maybe. First, I say maybe because nothing is ever guaranteed until it clears. Secondly, because the rules of The Market are not as perfectly enforced as we would like to assume. We are also finding out they may not be perfectly fair. The Market most experts are willing to talk about is really more like the ideal The Market is supposed to be. This is the version of the market I make my trading decisions in. However, the Real Market gets strange and unpredictable at the edges, when things are taken to extremes, or rules are pushed beyond the breaking point, or some of the mechanics deep in the guts of the Real Market get stretched. GME ticks basically all of those boxes, which is why so many people are getting nervous (aside from the crazy money they might lose). It's also important to remember that the sheer amount of money flowing through the market has distorting power unto itself. Because it's money, and people really, really, really like their money--especially when they're used to having a lot of it, and rules involving that kind of money tend to look more... flexible, shall we say. Ok, back to GME. If this situation with GME is allowed to play out to its conclusion in The Market, we'll see what happens. I think all the long-side people get the chance to be paid (what, I'm not sure--and remember, you have to actually sell your position at some point or it's all still just numbers on your screen), but no one knows for certain. But this might legitimately get so big that it spills out of The Market and back into The Economy. Geez, and here I thought the point of all of this was so that we all get to make so much money we wouldn't ever have to think and worry about that thing again. Unfortunately, while he's kind of a buzzkill, Thomas Petterfy has a point. This could be a serious problem. It might blow out The Market, which will definitely crap on The Economy, which as we all know from hard experience, will seriously crush Main Street. If it's that big a deal, we may even need Washington to be involved. Once that happens, who knows what to expect.. this kind of scenario being possible is why I've been saying I have no idea how this ends, and no one else does either. How did we end up in this ridiculous situation? From GAMESTOP?? And it's not Retail's fault the situation is what it is.. why is everyone telling US that we need to back down to save The Market?? What about the short-side hedge funds that slammed that risk into the system to begin with?? We're just playing by the rules of The Market!! Well, here are my thoughts, opinions, and some even further speculation... This may be total fantasy land stuff here, but since I keep getting asked I'll share anyway. Just keep that disclaimer in mind. A Study in Big Finance Power Moves: If you owe the bank $10,000, it's your problem...What happens when you owe money you have no way to pay back? It's a scary question to have to face personally. Still, on balance and on average, if you're fortunate enough to have access to credit the borrowing is a risk that is worth taking (especially if you're reasonably careful). Lenders can take a risk loaning you money, you take a risk by borrowing in order to do something now that you would otherwise have had to wait a long time or maybe would never have realistically been able to do otherwise. Sometimes it doesn't work out. Sometimes it's due to reasons totally beyond your control. In any case, if you find yourself there you have no choice but to dust yourself off, pick yourself up as best as you can, and try to move on and rebuild. A lot of people had to learn that in 2008. Man that year really sucked. Wall street learned their lessons too. Most learned what I think most of us would consider the right lessons--lessons about risk management, and the need to guard vigilantly against systemic risk, concentration of risk through excess concentration of leverage on common assets, etc. Many suspect that at least a few others may have learned an entirely different set of, shall we say, unhealthy lessons. Also, to try to be completely fair, maybe managing other peoples' money on 10x+ leverage comes with a kind of pressure that just clouds your judgement. I could actually, genuinely buy that. I know I make mistakes under pressure even when I'm trading risk capital I could totally lose with no real consequence. Whatever the motive, here's my read on what's happening: First, remember that as much fun as WSB are making of the short-side hedge fund guys right now, those guys are smart. Scary smart. Keep that in mind. Next, let's put ourselves in their shoes. If you're a high-alpha hedge fund manager slinging trades on a $20bn 10x leveraged to 200bn portfolio, get caught in a bad situation, and are down mark-to-market several hundred million.. what do you do? Do you take your losses and try again next time? Hell no. You're elite. You don't realize losses--you double down--you can still save this trade no sweat. But what if that doesn't work out so well and you're in the hole >$2bn? Obvious double down. Need you ask? I'm net up on the rest of my positions (of course), and the momentum when this thing makes its mean reversion move will be so hot you can almost taste the alpha from here. Speaking of momentum, imagine the move if your friends on TV start hyping the story harder! Genius! Ok, so that still didn't work... this is now a frigging 7 sigma departure from your modeled risk, and you're now locked into a situation that is about as close to mathematically impossible to escape as you can get in the real world, and quickly converging on infinite downside. Holy crap. The fund might be liquidated by your prime broker by tomorrow morning--and man, even the broker is freaking out. F'in Elon Musk and his twitter! You're cancelling your advance booking on his rocket ship to Mars first thing tomorrow... Ok, focus--this might legit impact your total annual return. You need a plan, and you know the smartest people on the planet, right? The masters of the universe! Awesome--they've even seen this kind of thing before and still have the playbook!! Of course! It's obvious now--you borrow a few more billion and double down again first thing in the morning. So simple. Sticky note that Mars trip cancellation so you don't forget. Ok... so that didn't work? You even cashed in some pretty heavy chits too. Ah well, that was a long shot anyway. So where were you? Oh yeah.. if shenanigans don't work, skip to page 10... ...Which says, of course, to double down again. Anyone even keeping track anymore? Oh, S3 says it's $40bn and we're going parabolic? Man, that chart gives me goosebumps. All according to plan... So what happens tomorrow? One possible outcome of PURE FANTASTIC SPECULATION... End of the week--phew. Never though it'd come. Where are you at now?... Over $9000\)!!! Wow. You did it boys, and as a bonus the memes will be so sweet. \)side note: add 8 zeros to the end... Awesome--your problems have been solved. Because... .. BOOM Now it's EVERYONE's problem. Come at me, Chamath, THIS is REAL baller shit. Now all you gotta do is make all the hysterical retirees watching their IRAs hanging in the balance blame those WSB kids. Hahaha. Boomers, amirite? hate when those kids step on their law--I mean IRAs. GG guys, keep you memes. THAT is how it's done. Ok, but seriously, I hope that's not how it ends. I guess we just take it day by day at this point. Apologies for the length. Good luck in the market! Also, apologies in advance for formatting, spelling, and grammatical errors. I was typing this thing in between doing all kinds of other things for most of the day. [link] [comments]  | ||||||||||||||||||
| What stocks are you looking to grab at a possible discount? Posted: 28 Jan 2021 08:55 PM PST With so much attention to only a few stocks we saw a small dip in the S&P500 on Wednesday. This is likely to repeat while also offering a good opportunity to buy. If that were to happen in next few days again, what stocks would you be looking to grab on a significant dip or a possible correction? My current picks would be NIO, SQ, AAPL, SE/LMND [link] [comments]  | ||||||||||||||||||
| Gamestop Big Picture: The Short Singularity Pt 2 Posted: 28 Jan 2021 06:02 AM PST Disclaimer: I am not a financial advisor. This entire post represents my personal views and opinions, and should not be taken as financial advice (or advice of any kind whatsoever). I encourage you to do your own research, take anything I write with a grain of salt, and hold me accountable for any mistakes you may catch. Also, full disclosure, I hold a net long position in GME, but my cost basis is very low (average ~$45/share with my later buys averaged in), and I'm using money I can absolutely lose. My capital at risk and tolerance for risk generally is likely substantially different than yours. First, thank you everyone for the comments and questions on my first post on this topic. Given the traffic and sheer volume of questions, I figured writing another post would be better (and actually something I can manage). I wanted to focus this post on a few common themes I saw in the comments to the first post, as well as questions people were asking me directly, and related themes I saw on other posts and subs that I believe would be informative for this sub. First, a simplified recap of the 1/27/2021 trading day as I saw it. The following is my interpretation of events, and may include personal opinions, assumptions, and outright errors. Apologies for the length, but I hope this helps some of the newer traders thinking about jumping into the water with these sharks. I honestly don't think that you should, but you make your own decisions. I'll just try to help provide some information to help if I can. Euro Market Hours: Retail Euphoria & The SetupAfter-hours and Euro market activity rockets the stock in an essentially unbroken streak from ~$146 to $365. GME long social media is going ballistic. Volume is too low. There is no sell-side pushback. Allowing consolidation at these prices would be a major setback for the short-side, yet they are doing nothing on volume they could easily push back. I smell a rat. This is too easy. 5am Eastern: Fear, Uncertainty, Doubt (FUD)If you ask most retail market participants about how quants with their algorithms, hedge funds with their trading strategies, sophisticated experienced traders, etc., conduct their operations, you will probably get responses about sophisticated programs and high frequency trading, fundamental analysis, risk hedging strategies, lots of math, etc. That is largely true, but it is critically incomplete. The most successful hedge fund managers also deeply understand that beneath the surface, the primal forces driving markets are fear and greed, and they know how to best leverage information asymmetry to play other investors--and especially retail investors--like fiddles. As retail sentiment reaches fever pitch, Andrew Ross Sorkin gets a call from Melvin Capital just before the start of CNBC's Squawk Box, by far the most-watched pre-US market show and files a breaking news alert at the start of the show. (Paraphrasing) Melvin Capital is out. They didn't go bankrupt but they came close and took a huge loss. Congratulations WSB, you've won and you've burned the house down, and now that the shorts are out this whole thing is going to crash and burn all the retail investors you dragged along with you. "Who's going to be left holding the bag?... uh, the thing that concerns me most, at this point, is whether some of these investors will actually start to get out today--they'll look at this and say 'we won the game'--if that's winning, uhh unclear, you know, where the finish line is, uh in that regard, but uh, as much pain as they may have uh, created for Melvin Capital for example, umm, my-my great anxiety at this point is the number of-of retail investors that have been jumping into this uhh.. in literally the last 24 hours who very well may get hurt, uh, far more, and lose far more than some of the hedge funds that were involved, uh in this. Um, let's just show you where we are now..." "Where are the regulators.. and is this just the beginning?" Meanwhile, as if it had been choreographed and rehearsed, the Squawk Box team are outraged--absolutely outraged at what is going on, while a big graphic of GME price crashing off a cliff dominates 2/3 of the screen and social media is flooded with messages and posts skillfully crafted to stoke the fear. In WSB, other subs, and other social media sites, dozens of bots start posting bogus messages purporting to mock the retail investors with messages like "Thanks for the free gainz retards!". The fear is almost palpable coming through my monitor. People start trying to sell, then start asking why their market sell orders won't go through while they're watching a practically vertical dive on the GME chart next to Joe Kernan as he says "If you think there's speculation in crypto [...] and-and-now they're looking for the next mark, right? They'll-they'll find another Gamestop, once they're done with Gamestop, but in the meantime, there's gonna be BLOOD". Congratulations Squawk Box--you beautifully played your part in engineering peak, nigh-hysterical fear among the less experienced retail investors, and basically shouted "FIRE!!!" in the market equivalent of a locked theater. I truly believe your feelings were sincere, and you truly do have concern for the retailers who have been and will be hurt in all of the volatility, but that made your actions all the more effective in driving many try to lock in losses. C'mon, you can do better--I've seen you do good work and am thankful for what you did getting good info out during the peak of the pandemic--please do some investigation before spreading only one side of the narrative handed to you by financially conflicted parties. You have analysts doing your background research--any of them could tell you the short interest in GME would take more than an entire trading day to unwind even if the buy-side of every single transaction that day was to close a short position and no new short positions were initiated. Also, any of them could tell you that it's unlikely Melvin Capital held 100% of all short interest in GME. Melvin leaving is not equal to all shorts being covered--and you didn't even get confirmation that Melvin actually covered! Get them to say it themselves on air rather than carrying their water and letting them ride on your reputation and providing cover from an SEC stock manipulation investigation. Most retail brokerages don't open pre-market trading until around 7am. All those people could do was watch their positions bleed as GME plummeted over the remainder of the next 2 hours, hitting the floor of $182, nearly 50% down from the peak about 3 minutes before retail brokerages open pre-market trading. Wow. I have to hand it to the short-side hedge funds. Some of your traders must have studied drama for their undergrad or something--that is almost perfect timing. Almost, but not quite. Pre-Market Tears... of Joy and ReliefThe engineered crash was probably intended to run right through the open of retail pre-market, with the idea of getting panicking retail to sell into the low liquidity environment for more violent downward price moves without the benefit of Limit Up/Limit Down halts, causing a stampede for the exits. Man, how many hours did you guys spend thinking this strategy up? I'm honestly impressed. Two minutes prior to pre-market open, however, some deep conviction, deep pocket players, understanding the market mechanics and fundamentals behind the recent wild ride in GME started raking in the shares at discount prices they probably never thought they'd ever see again during this campaign. I'm sure tears of joy were shed, as they realized floor-to-close of regular trading gains of nearly 100%. Whoever you are, well played. I would note here that those people could easily have waited for the engineered crash to drain the blood of the fearful retailers who would have punched out, which would have allowed them to lock in greater share volumes at even lower prices, but they stopped the crash early instead. I don't know if that was their intention, but a lot of retail people were probably saved because of that. With the almost literally last-minute reversal, price rode green candles upward through the retail pre-market open, and many who would have despaired and punched out to lock in losses instead white-knuckled through the chop and held, with very bullish action through to the market open. Those who survived the day--good on you, I know it couldn't have been easy. ChamathLet's let the man speak for himself (and speak up for retail). Well worth spending 30 minutes to watch if you have the time. I have to give Scott Wapner credit--he asks tough questions and he repeatedly brings on guests that he know will go toe-to-toe with him with the gloves off to ensure that there is a good, vigorous debate representing diverse viewpoints. Be on the right side of history big boy, lol. Skirmishing continues at lower volume than the last 2 trading days. Bullish patterns everywhere--buying up on high volume, straggling down on low volumes. Liquidity is running out. Short-side is rationing, saving ammo for the end-of-day push. Shenanigans, End of Day, More ShenanigansAt various points throughout the day, levers are pulled to flush retail positions out by margin calling profitable accounts across many of the retail brokerage firms, changing margin requirements with no notice. Short-side attacks coincide with ominous warnings on news media about potential regulator action, short-side touts spreading FUD across mainstream media. Short-side's rationed insufficient shares to make meaningful progress on the last tick of regular trading. This is key, as prime brokers of highly levered players pay a lot of attention to the status of accounts at the end of regular trading each day. After hours it looks like more retail traders are dumped out of their profitable portfolios due to margin change requirements--right into the abyss of super-low after-hours volume. Had their brokers at least liquidated their accounts toward the end of the main trading day into meaningful trading volume they would have gotten much better returns. Dumping them into no volume means the last few accounts took massive losses vs mark to end of trading day market price. Thank, you brokerages, for protecting those people from themselves. Hopefully they took lower profits vs being dumped into the red. Some people see the diving ticker and panic again. One thing that was particularly irritating to me is that people were all over CNBC multiple times a day, making outrageous claims of how retail traders were slamming risk into the market via leveraged trades even as the retail brokers changed their policies in realtime to disallow use of any margin in accounts holding GME, and dumped those retail traders out of their positions. I knew what kind of volatility to expect, so I had maintained a net cash position in my account ever since buying, just in case something like this happened--thank goodness. Technical Analysis for the DayI wish this sub would allow charts, but I'll describe instead. On the daily chart, RSI has been in an ascending channel since April '20(!), and rocketed to 98+(!!!) at the end of the trading day. Price is dislocating wildly higher every day for the past 4 days into descending volume. My read of the chart is that it shows massive buy-side dominance into worsening sell-side weakness and lower liquidity. I read this as mind-meltingly, parabolically bullish, and something that would not be possible if not for the distortion of the supercritical mass of short interest, and I guess this is what a short squeeze looks like when you have access to all the data retail fintech can provide. The technicals tell me to expect massive volatility, but also that this is possibly the most asymmetrical risk environment imaginable. I feel bad for the retail shorts that I know were out there. I saw a few posts about people taking short positions because Andrew Left got on TV and told them GME is going bankrupt, it's going back to $20, and he's an expert unlike you reddit amateurs, and by the way about 30 other experts followed and backed him up over the past few days. For this reason I'm glad that many of the retail brokerage firms have disallowed shorting GME and other volatile names. I hope they got out before their accounts got obliterated. Lessons LearnedI wondered what kind of things you might see when billions of dollars were on the line, and I have to say that the short-side guys know how to go all-in and pull surprise after surprise out of the hat. They are good at manipulating people, letting them build up euphoric feelings only to slam them in the face with nonstop fear. They do it in media, and they do it in sudden price-crushing rushes, slamming the ticker down to try to get weak hands to fold. As I stated earlier, I am trading deep in the money, on capital I can afford to lose, and even I can't avoid feeling it. I honestly don't know how some of you trading on borrowed money meant for next month's rent can handle it. The short-side players are running out of ammo, but they don't just go toe-to-toe in the market--they'll blanket media and even flood your discord server, message board, and social media with well-coordinated bot attacks. You will face those moments of stark terror--they are good getting people to feel fear. If you're thinking of getting into this trade--please understand that before deciding whether to jump in. You might not think that a stock that's been going basically vertical could leave long-side casualties on the field, but believe it--fear and volatility can get you to zero your account (or worse!) in any environment. FAQs from the First Post (comments and messages)(answers are my opinions only--do not take as financial advice. I've consolidated common themes.)
First, each person decides on their own what trades they choose to make. However, I will say this: Fear is giving you this anxiety. Maximum FOMO is when you see green candles going up until the fear makes you punch the buy order in. Maximum despair and fear of life-altering losses hits peak during deep downward price movements, making you punch out to avoid losing your entire position. Fear makes you buy high and sell low. HFT houses are full of algorithms designed to exploit fear through the price movement, and find gaps in your risk mitigation strategy (e.g. stop-loss hunting algorithms, etc.). If fear is driving you to trade, I urge you not to swim in low-liquidity waters with sharks who specifically make their money exploiting fear.
You may be surprised to hear that I, and likely many others have thought quite a lot about these things. In fact, I hold about 75% of my capital in the same type of boring IRA and 401(k) accounts you're talking about, and I maybe rebalance them a few times a year and don't even check the balances regularly otherwise. As for what kinds of impacts there may be--in all honestly, no one knows. Specifically, no one knows because no one knows exactly what the levered hedge funds involved hold, how they trade, etc. The massive short interest in GME is basically a deliberately engineered market distortion that is now blowing off, and distortions blowing off are always scary, and can spell financial damage or disaster for the unprepared. That, however, is part of the market. To paraphrase Dr. King and Keynes, the arc of the market may be long (and longer than you can remain solvent), but it bends toward efficiency, given the right conditions. The US stock market is pretty good in this respect. Now I won't deny that these hedge funds are run by smart people, but they occasionally get either arrogant or too clever for their own good and get caught. In GME they essentially voluntarily engineered themselves into a short squeeze entirely on their own while no one was even looking. In fact, the only way the trade works is if no one ever finds out and GME quietly goes bankrupt. In the meantime, a legitimate fundamentals-based turnaround story came to light and just lit the fuse. They're crying now about being cornered, but they walked into that corner themselves, then dug themselves in so deep that the only way out was GME bankruptcy, and sat there for a year just assuming GameStop would go bankrupt while no one was paying attention and they'd take their free money and walk. If this doesn't make sense, and you have a free 20 minutes and tolerance for mild profanity, I suggest you watch this video: https://www.youtube.com/watch?v=4EUbJcGoYQ4 Anyway, That being said, market "corrections" are aptly named, even if painful, because they are, in essence, corrections of various distortions in the market. The longer they go uncorrected, the harder, faster, and more drastic the move when it does happen--with usually worse consequences (see the 2008 financial crisis, which was a distortion 10+ years in the making before blowing off).
I have no idea. I wasn't looking at Hertz at the time. Obviously it's different in that GME is not going bankrupt despite what some people on the news might say (honestly, I don't understand their apparent conviction on this given most of them profess to not even know any details about Gamestop). The sense I get is that some people realized that many stocks had their prices artificially suppressed by the pure panic in the market at the time, and were likely to bounce back. Stocks crushed down to penny stock land could easily bounce back multiple hundreds of percent just by moving back up by $1, and if you had a good reason to think they'd survive, that's a pretty good deep value trade. Some people seemed to jump on that bandwagon with the mistaken idea that you should basically just scan all stocks for things <$5 today that used to be >$20 or whatever and assume the 90+% drop will result in a bounce off the floor, even if it's a "dead cat" bounce on the way to $0. DO NOT TRY TO TRADE THIS. The theory is that a $100 stock that drops to $10 on its way to bankruptcy could bounce back to $15 first—a return of 50% if you time the floor and the bounce perfectly. In practice almost everyone who tries this loses all their money much sooner rather than later. By the same token, people who "know" a company is heading to bankruptcy get their accounts wiped out when they short something on margin right as it hits a floor on the way down, get margin called on the bounce, and subsequently join the company in insolvency as they end up owing their broker more than they put in. Being right in the end is cold comfort at that point.
I guess it could, speaking entirely theoretically. That being said, consider the following: They've already filed to issue $100mio worth of shares, or 500k shares using $200/share as a price assumption. I don't know if they've begun to execute on that. That was just to give them the runway required to take bankruptcy completely off the table. As you note, at these prices, using stock to finance a turnaround is absolutely feasible. There are, however, a few things to consider:
That may be true in some ideal theory assuming you are trading in some kind of mathematically ideal market using very specific assumptions, but you're trading in a real market that includes things like counterparty risk, regulatory and contractual limits on ability to borrow (at least in theory--Hello SEC, threshold securities list??), interest cost, etc. that make trading in an real market different. I'll build on Box by saying all models are wrong, but some are useful--within the bounds of certain assumptions. The situation playing out now tells you that the short interest of GME is wildly outside the bounds of whatever models the hedge fund people are using to model position risk. You can, in theory, infinitely roll your debt forward if you can continue to find willing lenders and are ok paying interest forever. Maybe this works out to be mathematically preferable to a squeeze to infinity. But, step away from pure theory for a moment. We don't even have to look at empirical evidence in real markets. All we need to do is build a stochastic model of an equity market sophisticated enough to model margin limits and dynamic account balances tied to securities being traded as they are in real markets and you'll see the probability of continuing to carry a short position converges to 0 over time. The only question is which happens first: you cover proactively, the underlying company goes bankrupt (and you cover for $0 less interest paid to borrow the stock), or you're margin called and forced to cover with potentially unlimited downside. Take bankruptcy off the table as we have in the case of GME and you have one of two choices--get out or eventually get squeezed out. There is no such thing as infinite ability to roll borrowing forward in real markets, and if your risk models assume that I feel sorry for you.
I am not a lawyer. I do not give legal advice. And, honestly, I have no idea. I can't think of any securities regulation that at least I may have violated, but I also don't have the ability to lobby the SEC on international news.
I don't know, and most likely anyone who tells you they know is kidding themselves. All I see is a good fundamentals-based position I bought into at a reasonable but bullish valuation followed by the most bullish chart I've ever seen from a TA perspective. I have theories, but there are doubtless other people better qualified to opine on that. All I can say is if you're in the trade, strap in and prepare for a wild ride. If you're watching from the sidelines get out the popcorn. The rate at which liquidity is disappearing means whatever is going to happen will happen soon (assuming the SEC doesn't step in with an extended pause in trading to bail out the hedge funds). Thank you for reading, and good luck with your trades. *Update from Original Draft, 1/28 Pre-Market\* We're seeing tons of retail brokerages limit trading on GME to only allow selling, even when current positions and intended trades would be cash only? Wow, I mean it kind of occurred to me in some sort of theoretical, abstract sense that somehow limiting large swathes of retail to sell-only was actually better than a general 2-way trading suspension, but who knew the short-side people could actually get retail brokers to do something so bonkers?? I guess you really do find a way to try basically anything when you're about to lose that much money. *edits to fix formatting issues* [link] [comments]  | ||||||||||||||||||
| Facebook now trading at only a forward P/E of 20.5 Posted: 28 Jan 2021 11:52 AM PST At the time of this post, Facebook is surprisingly down 1.75% after releasing fantastic earnings (although being up 5% on open this morning). The earnings were so good for Q4 that the stock is now trading at only a PE of 25, and a forward PE of 20.5 . I can give you a super long detailed analysis and DD of why Facebook can grow profits at 20%+ per year for several years, but I think the explanation is obvious, we're all familiar with this company's moat. At a forward P/E of 20 and a profit growth rate of 20-25%+ per year, this is an insane deal. [link] [comments]  | ||||||||||||||||||
| Unusual after hours volume on $FNMA & $FMCC? Posted: 28 Jan 2021 07:44 PM PST Yesterday, I noticed 20M in after hours volume on $FNMA and 11M for $FMCC. This seems highly unusual considering the full day's volume (before the after hours trade) for $FNMA was only 18M. With a pending decision from SCOTUS in Collins, this seems correlated, but I'm speculating. There is other recent news here as well though... the government filed a motion to dismiss all derivative shareholder suits in the Fairholme suit. Bill Ackman has also chimed in with his opinion on these being undervalued. With housing booming, profits soaring, and just underlying basic need for the GSEs, I'm curious what will happen if/when SCOTUS issues a favorable ruling within the next 100 days. Are these forever foresaken or is there upside here? If you've been following the GSE saga, what are your thoughts? [link] [comments]  | ||||||||||||||||||
| Posted: 28 Jan 2021 04:04 PM PST With all the hullabaloo about GME and other meme stocks, this kinda flew under the radar. President Biden issued multiple climate change related executive orders yesterday, some with potentially big implications for the market. Big highlights:
I'm just curious who else had seen this, and what your thoughts are. There is a lot more but these were the big ones that stood out to me. Announcement: Edit: Mods, I did my best to keep this politically neutral, lmk if this is a problem. [link] [comments]  | ||||||||||||||||||
| Posted: 28 Jan 2021 12:15 PM PST This would be Expecting large infastructure spending to boost economy that doesn't help the stock market but exacerbates inflation. I was hoping to find an actively traded commodity/miner fund that would know their shit and be able to trade it so I don't have to learn myself. Like a Cathy Wood of Commodities. Any suggestions? [link] [comments]  | ||||||||||||||||||
| Posted: 28 Jan 2021 06:01 AM PST Hi All, So far most of the threads in the modqueue are just people asking about GME, shorting, or hedge funds. Honestly these should all just be comments in existing threads and us mods can't spend all day deleting repetitive posts so we'll keep things locked for a bit. As always, if you make a post that you think is worthwhile, or is on another topic worth discussing please message us and we can approve. Side note: obviously we don't have the mod bandwith for this sort of stuff, in every "meta" post I've made in the last year I've asked for mod volunteers and have gotten zero. Reddit sent us an automated message yesterday because our traffic spiked so much (automated, because admins don't give a fuck). I'm going to leave a comment with some additional thoughts on that below. With regard to GME, we'll have a thread coming soon, /u/jn_ku's posts have been popular so far so his 3rd installment will be allowed shortly. - and that's the thread for today unless there's some MAJOR news item. We're still gonna keep the posts filtered because nobody pays attention to megathreads anyway. For this thread - please feel free to have meta discussion on the subreddit and traffic, offer up suggestions, call the mods assholes, etc. Please do not discuss GME or anything related here - that goes in the follow up megathrad And for the love of christ please stop asking us for access to WSB. That's not how Reddit works. [link] [comments]  | ||||||||||||||||||
| Lunch with Levine doing an IG chat live at 13:30 Posted: 28 Jan 2021 10:24 AM PST I will apparently be doing an Instagram Live with my colleague Nir Kaissar today (Jan. 28) at 1:30 p.m. New York time on @bloombergopinion. Join us if you want to talk about GameStop. I don't really understand IG Live but I gather there'll be rocket emojis in some form. for all of us who love him (/u/mastercookswag) get involved! [link] [comments]  | ||||||||||||||||||
| For anybody wondering about CD Projekt (7CD) skyrocketing today Posted: 28 Jan 2021 09:11 AM PST | ||||||||||||||||||
| RKT getting ready for lift off Posted: 28 Jan 2021 08:51 PM PST This company is undervalued it is ridiculous. Revenue of 9B the past 2 quarters. The housing market is at all time highs and the MBA refinance index 2-3x higher than the year prior. This stock is about to announce ER which by all means should be another record quarter for them even though this is suppose to be the non busy part of the year for them. Last quarter they issued a 1B dollar buyback program and this quarter they are suppose to announce a new partnership and possible dividend. The fed has already come out and said that they will keep interests rates at near 0 until 2023. Short interest on this stock is 31% most recent numbers show 34% and institutional ownership has only been going up. I'm long this stock I've got $520 shares and if it continues the pullback I will look to add more. Would like to know if anyone thinks differently to see where my research and assumptions may be wrong. [link] [comments]  | ||||||||||||||||||
| An unanswerable investing question Posted: 28 Jan 2021 12:42 PM PST I am interning at a investment fund with around $2B AUM. I seek out the reddit forums for an answer that our fund has been looking for. We have been studying the correlation of the return of the 10yr treasury and the return of the SP500 in the presence of inflation. From 1980-2000, when inflation was relatively high, the 10yr treasury and the SP500 provided returns with a positive correlation. From 2000 to present, where inflation was lower, the 10yr treasury and the SP500 have had a negative correlation of returns. This means investors were able to use the 10yr as a hedge for their portfolio, providing safety if their equity holdings experienced a drawdown. My question to you all is, what caused the change in the correlation? Was it the switch from periods of higher inflation to lower? How should one use this info to prepare for the coming years, in terms of adding treasury protection to your portfolio, if inflation is expected to rise? [link] [comments]  | ||||||||||||||||||
| Walmart Announces Vision for Its Media Business! Posted: 28 Jan 2021 08:31 AM PST Dubbed "Walmart Connect", Walmart is aiming to leverage all of the data it has access to in order to offer an omni-channel advertising experience in order for Brands to reach their shoppers! In case anybody isn't aware, this is a HUGE source of revenue for Amazon and Walmart is finally stepping up to the plate. I think Walmart is a sleeper pick, and has huge potential. At worst, it continues to be a retailer where 90% of America shops at with slow growth in their ecommerce business... Solid stock either at worst. If they can pull their new vision off, this means $$$ [link] [comments]  | ||||||||||||||||||
| Reasons why CCIV might be the stock of 2021 Posted: 28 Jan 2021 12:21 AM PST
Down side at least for now: 1. The the merger is temporarily "delayed" CCIV. 2. This merger news is based on rumors. Resources: 2- Five-year plan to reach $1 trillion assets under management [link] [comments]  |
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