Stocks - Weekend GME Thread + Homework for all: Let's stop using brokerages that halted trading |
- Weekend GME Thread + Homework for all: Let's stop using brokerages that halted trading
- Is anyone else feeling really depressed from the turn of events recently?
- GME | Second Act | Margin Call Explained | AMC & Other High Short Interest Stocks
- The rise of GME was predicted step by step 143 days ago in this DD
- Blackberry stock. Am I screwed? what are peoples thoughts on BB?
- Should i invest in GME on monday?
- I’ll hold the bag.
- An Oversimplified Look at the GME Situation
- GME got me interested in the stock market. Yesterday I invested my money for the first time.
- Some thoughts on the NOK longer term play
- AMC: how much have the shorts covered? And do they have to?
- Tesla service now includes collision repairs, fulfilling Elon Musk’s 2018 promise
- Unpopular opinion: The events that unraveled this week were good for the retail investor
- $GME is an abysmal company....but it's possible you could still get a 100% return even if you buy at $312.01, here is why/how.
- AMC could've absolutely skyrocketed to $40-$50 last week, here's why it didn't.
- What're your opinions on the large amount of Instagram, Tik Tok etc, financial "influencers"?
- My prediciton on what will happen
- Are you hedging your portfolio in anticipation for next week?
- Q: Why don't people discuss the % Utilization of Free Float in any of the GME discussions? Am I missing something?
- Investing in GME is not guaranteed free money
- Can't the hedge funds just hold forever? $GME
- Can we please stop the misinformation
- A little insight needed please
- Could this GameStop (GME) bubble be what pops the stock market bubble that Jeremy Grantham says that we are currently in?
- Could GME really have a large impact on the overall markets?
| Weekend GME Thread + Homework for all: Let's stop using brokerages that halted trading Posted: 30 Jan 2021 10:03 AM PST Hello all, Let's use this thread to discuss the GameStop situation this weekend, please don't open new threads about it unless it is a unique perspective or brings very valuable information. Do note, posts and comments are still restricted to users with a higher Karma and account age. Important informationFirst, let's get some things out of the way:
Let's make a list of the Brokers that betrayed the Retail InvestorThe worst thing that happened this week, was the betrayal of our Brokers, choosing instead to side with the establishment and restricting the purchase of certain stocks, tanking those tickers. Now, I'm aware this is more complicated than that, and some clearing houses (such as Apex Clearing) forced some Brokers to do it. Even if that was true, the Brokers should tell clients that this is the cause, and they should be pushing, as much as we are, at getting this resolved. Here is my list , please comment below and let me know which ones I've missed: Horrible Brokers - Restricted purchasing of certain tickets and lied/gloated about it
Bad Brokers - Restricted purchasing of certain tickets
Neutral Brokers - Restricted trading, publicly naming and shaming their intermediary
Good Brokers - Did not restrict trading
We will keep this list on the sidebar...forever. Please help me build this list to completion. If you are using a broker in the bad list, even if you are not invested in the tickers that have been restricted, please consider moving to a better broker. Thank you all for your patience, we are sorry new members are not able to comment yet, we promise you will be allowed to once this is over! [link] [comments]  |
| Is anyone else feeling really depressed from the turn of events recently? Posted: 29 Jan 2021 06:07 PM PST I used to be a proud trader and investor, determined to break through the shackles of society to reach financial freedom. I started out with almost zero, and by capitalizing on the stock market frenzy last year, I was able to completely change my life around. I used to think that if I worked hard, did my due diligence, traded smartly, I could make great investments and someday reach the pinnacle of my financial dreams. Something has shifted now. I no longer feel the same way, and I'm not sure if I ever will again. I wonder if it's naive of me to have thought that the free market was fair. I'm not American so I wasn't aware of the parties involved during the financial crisis in 2008, but it seems that many people are equating what's happening now to back then, calling out the blatant market manipulation in favor of the rich at the expense of the poor. They can crash multiple brokerages at the same time, disable purchase of specific stocks instantaneously, manipulate price action in real-time by changing the supply/demand, unleash a short ladder attack on the stock price while the trade volume is being restricted. We've always understood that the media was manipulated, but it was up to us if we wanted to listen. But our direct purchase of stocks, and outright price action manipulation, suddenly it feels very personal. It just makes me so sad to know that this hobby of mine that I've enjoyed and come to love so much, is actually controlled by people at the top who can do whatever they want, at any time they want in favor of their own interests. I came into the investing world filled with hope and excitement, and passion for the art of understanding business and capitalizing on opportunities. I'm sad to think that I may never have this outlook again, in light of everything that's been coming out. Just looking for words of encouragement right now. I love investing and I don't want that joy to be taken from me EDIT: This is not about money, it's about the integrity of the system. I am, and will continue to hold the stock. [link] [comments]  |
| GME | Second Act | Margin Call Explained | AMC & Other High Short Interest Stocks Posted: 30 Jan 2021 06:15 AM PST To everyone that held, you've leveled to diamond-hand generals. In game theory, the only way you could have maximized your gains was if you all stuck together, and you did! They had counted on you guys scattering, and that's why they took out new shorts on GME. GME was on the cusp of a short squeeze on Wednesday, before they closed off all buying, and did the short ladder attack. It shows that they've learned nothing since the Great Financial Crisis (GFC). They play by one primary rule: Heads we win. Tails you lose. And they can change the other rules last minute to drive to the primary rule. Next, they will try to block/limit buying across RH and more brokerages so there's not enough volume to drive to the short squeeze. Meanwhile Hedge Funds are free to buy/sell unlimited amount of shares and create short ladder attacks [1]. Different rules for different players in this game! But let's move back to the whiteboard. 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. Today, I'll describe what a margin call is and explain a High Short Interestt trading strategy around it. In Particular, I'll use Melvin Capital presumed short book as a case study. Note: I'm not a financial advisor, this is just me whiteboarding. Long/Short StrategyIn the Hedge Fund industry they have a strategy called long/short. They go long on momentum stocks and short undesirable ones. Ie buying Apple and shorting Gamestop. This trade is profitable if Apple's stock price rises and Gamestop's (GME) share price decline. However, let say the trade doesn't go their way and Gamestop share prices dramatically because of a short squeeze. In this case their net position is negative. Let's say 30% negative. If it becomes large, their brokers calls them up and ask them to put more cash. Then they raise 30% more cash or sell stocks that been paid off to meet the reserve requirement. This is why you see the general stock market deep red, while GME moons. Hedge funds are selling their winning longs to raise cash for the margin requirement. When GME short squeezes, they may have to liquidate (sell off all their longs) and cover their existing short position. Moreover, they have other leverage short positions that are also highly shorted (> 50% of the float). This becomes what's known as an arbitrage trade. It's also a cluster of nuclear bombs that may go off for shorters, but if it does, it'll make someone rich. I'll call it the High Short Interest (HSI) Trade. It's a high risk trade but with potential for very high profits/returns should it go your way. The High Short Interest TradeShould Hedge funds start to cover short positions because of a margin call or liquidate, they will be forced to buy up shares in the open market. However, if those shares are scarce, it will create a huge short squeeze in which they will have to pay higher prices to meet their obligation to return shares. I'll use Melvin Capital as a case study because they have publicly declared they had a high short interest in GME, so most likely be margin called or liquidated, should the GME short squeeze happen. Furthermore, I'll analyze their possible short position to justify why the squeeze may happen. Again, this is all conjecture and thinking out a possible trading strategy In this case study, a high short interest stock is defined as one in which the short interest is greater than 50%. The reason why we will focus on these stock is because of the difficult means to buy back all the shares before the market discovers that these shares are valuable/high demand and Hedge funds will likely have to buy them back at any price to meet contractual obligations. Going forward, everything I write is based on conjecture but backed up by evidence. Shorting data is a opaque dark art and it's hard to get concrete data. But it shouldn't block us in this whiteboarding session. Here is a Melvin Capital possible short interest based on their sec filing of put positions [2]
I'll analyze short interest based on data from ortex.com [3]. Ortex data is shown in the imgur links. This data is not confirmed but an estimate short interest and such has a possibility for high errors. However, ortex has been very reliable in the past. AMC Estimate Short Interest: 63M Float: 102M % of float shorted 62% Dillards (DDS) Estimate Short Interest: 4.2M Float: 5.5M % of float shorted: 76% Bed Bath and Beyond (BBBY) Estimate Short Interest: 58M Float: 109M % of float shorted: 54% MAC Estimate Short Interest: 71M Float: 113M % of float shorted: 63% SKT Estimate Short Interest: 48M Float: 90M % of float shorted: 53% As you can see all these positions are heavily shorted, and should this hedge fund need to acquire shares of them on the market because of liquidation, it may have trouble to close out its short position. Hence, a very high likelihood of a short squeeze similar to what has happened with GME and AMC this week. It's why brokerages are likely preventing people from buying them or limiting the number of shares to buy. They may have data that these shares have high short interest and are vulnerable to a short squeeze, so they may be actively limiting people from buying them to ensure a short squeeze doesn't happen. That is not a free market! They may be protecting hedge fund interest over your own ability to do what you want with your money. Short Ladder AttackA common maneuver Hedge fund deploy to vacuum up shares is a short ladder attack [1]. They do this to drop the price and scoop up shares. For hedge funds with big short positions this is effective because it makes it seem like the shares aren't valuable when they are. Usually, they will borrow 1-3% of shares and short, causing a sudden drop in price, and signal people to panic sell. If they do this repeatedly after like 10 days, they can close out 30% of their short position before the market notices. Do you see now how they can leverage 1% to scoop up 30% of the shares they need to acquire with this attack? Instead of buying all at once, they use short ladder attack with a short position to gain shares from people scared of a sudden price drop. It'd be difficult for them to vacuum up all the shares at once without the price increasing or the market knowing, so they manipulate the price lower and do it over a period of time. That is why you'll see the days to cover metric. Based on the volume, it suggest how many days they can get away with this before they are whole. However, should people realize that their short interest is too high, they can HOLD and buy more shares to force hedge funds to buy the shares at a higher price. But you can see that the volume is increasing, so the market is aware of a potential short squeeze. Note: Strong short squeezes are usually seen when short interest is above 50%. Anything lower and the hedge fund can't usually be squeezed unless they make a strategic misstep, which rarely happens. Short Squeeze PrecedentIn the week of March 20, 2020, Blue Apron had a short interest of about 50%. And then they experienced a short squeeze which led the price to climb 1000% in a week. So you can see how explosive the share price can climb, should a short squeeze occur, for stocks with a short interest of 50% or greater. Never trade more than you're willing to lose. Diamond hands. TLDR; Should hedge funds be force to liquidate their holdings because of a GME short squeeze, they will rush to cover their other high short position, because if they don't, they will lose control of the share price. But before they try to buy up the shares they owe, if millions of people have bought in before they are able to buy up all the shares, it may set up a short squeeze like with GME and AMC this week where those share prices went up 300%-600%. References [1] https://www.reddit.com/r/wallstreetbets/comments/l72r36/what_is_a_short_ladder_attack/ [2] https://www.sec.gov/Archives/edgar/data/1628110/000090571820001111/xslForm13F_X01/infotable.xml [3] http://ortex.com [link] [comments]  |
| The rise of GME was predicted step by step 143 days ago in this DD Posted: 30 Jan 2021 09:43 AM PST Just saw Chamath share a DD from a reddit user that predicted the GME's meteoric rise and impending squeeze, exactly play by play 143 days ago before anyone was even thinking of GME for potential stock picks. You have to see this: https://www.reddit.com/r/wallstreetbets/comments/ip6jnv/the_real_greatest_short_burn_of_the_century/?utm_source=share&utm_medium=ios_app&utm_name=iossmf [link] [comments]  |
| Blackberry stock. Am I screwed? what are peoples thoughts on BB? Posted: 30 Jan 2021 07:09 AM PST Last week I loaded up on some shares of $BB. my avg price is $20.73. My plan was to sell some weekly CC and just get assigned. but of course that didnt happen. i didnt realize it should tank so fast. After hitting a $28 high, it has just kept dropping. is there any chance of it rallying up next week? what are peoples thoughts of $bb? [link] [comments]  |
| Should i invest in GME on monday? Posted: 30 Jan 2021 04:09 AM PST So honestly i have no idea of the stock market and i just want to hop on the bandwagon and make some money of the rich. I don't have a lot of money and can probably buy only one share. My expectation is that it will rise a lot on monday since the whole situation has gotten a lot more attention around the globe. So if i just want to make some money should i buy some on monday? [link] [comments]  |
| Posted: 30 Jan 2021 11:24 AM PST Avg Joe here with a decent career and salary that's held through the pandemic. I have a few shares in GME and AMC. I'll hold the bag and put against my taxable income for this year. My other positions are strong and I'm just here to fuck the HFs. [link] [comments]  |
| An Oversimplified Look at the GME Situation Posted: 29 Jan 2021 10:03 PM PST If you are still trying to puzzle out what's going on with GME, try thinking about it this way: When the Harry Potter books first came out, there was a lot of demand. It might have been profitable to borrow a copy from the public library and sell it on eBay. Sure, you now owed a copy to the library and they were charging you late fees; but you just made $50 and eventually you'd pick up a used copy for $5 once the hype died down and you'd finish miles ahead. Unless something crazy happened like every copy of the Harry Potter books being sold out for months and all the used ones going for more than you sold your library book for. Then you'd be watching the cost of the books keep rising and you'd be accumulating late fees to boot. And since people were still wanting to read the book, the library would have to buy a replacement for the book you hadn't returned while they waited for you to return it. Now imagine that happening on a massive scale, creating tons of demand with limited supply. That is what is happening with GME. The short sellers haven't returned their library books yet and they are paying more and more late fees while they wait for the price of replacement books to come back down. Except the price won't come down and eventually they'll have to start buying books at market price or the cost of the late fees and the opportunity cost of having their resources set aside for replacing library books will make their losses even worse. This will cause more demand, increasing the price of the books, creating even more urgency for degenerate borrows to cut their losses and move on. Even better, the borrowers are currently committed to returning more books that are actually available to be bought at any price and the publisher is not printing any more. That is why holding the stock makes sense. [link] [comments]  |
| GME got me interested in the stock market. Yesterday I invested my money for the first time. Posted: 30 Jan 2021 11:18 AM PST I don't have a lot of money hidden away. But until now, it's all been placed on a savings account with no interest whatsoever. Not understanding how to even buy stocks or knowing how the market works made me too afraid to do anything about it. Until now! These last couple of days got me really interested in the stock market, so I decided to educate myself. I've been reading and learning a lot and, even though I still know very little, I finally took the first baby steps towards investing my savings for the first time yesterday (a very small portion of it). I invested in two green funds and for fun I also bought one GME share. I understand I'm likely to lose a bit of money off GME, but I'm alright with that. It will have symbolic value as it was the stock that got me started. Anyway. I'm glad I took this step. Next thing to do is to set up a monthly saving. I'm a student, so it won't be much, but it will be better than nothing! Just wanted to share my happiness with you. :) (Any newbie-tips will be appreciated). [link] [comments]  |
| Some thoughts on the NOK longer term play Posted: 30 Jan 2021 11:55 AM PST I'm bullish on NOK, have 31 x $10c 1/22 contracts at an average $0.77. Pretty new to option trading so don't want to go totally in yet, but depending on what happens with earnings I might pick up some more. I think a lot of the commentary around NOK seems to be expecting it to moon this week or next week, and while a good earnings release might see that, I want to explain at a high level why I'm bullish longer term, and not looking at it as a get rich quick, or a short squeeze or anything like that. As I say, pretty new, so would welcome people poking holes. Firstly – NOK is not a mobile company, it is 5G company. 5G has enormous potential in the world – it will be a critical part of truly autonomous vehicles, drone technology etc. It's not just so you can stream your favorite OnlyFans in 4k while on a car trip with your parents. It's also worth noting that 5G hasn't even scratched the surface yet. Mobile companies saying they have "5G networks" are full of it, they are retrofitted 4G networks that can barely be called 5G light. 5G requires all new infrastructure, and the expected expenditure across the world is measured in the trillions, not billions. There are 3 main players in the 5G market – Ericcson, Nokia, and Huawei. Other players (like Samsung) are in the mix, but at a lower level (although do represent a competitive threat to Nokia). Huawei has largely been shut out of 5G in the western world, which means Nokia & Ericsson are in a prime position to capitalize. Ericsson actually has much higher exposure to China than Nokia, which doesn't seem ot be priced into their share price, but one would expect China will take revenge eventually Between Ericcson & Nokia – a lot of key metrics (revenue, margins etc.) are pretty comparable. Both have revenue around ~US$25b, broadly similar margins etc. Despite that, Nokia's market cap is around ~$25b, vs Ericsson is DOUBLE that at around ~$42b. In other words – Ericsson is trading at a significant premium to Nokia at the moment, despite having reasonably similar underlying businesses. The general belief is that Ericsson has been the better run business, has a bigger share of the 5G market etc., but that also doesn't give Nokia credit for the work they have done recently, including putting a complete change to their operating model going into place 1/1/21, a new management team etc. While there's a risk none of that pans out, it also represents a good opportunity if they can start to run the business a bit better. Ericsson released earnings this last week and crushed it – earnings rose 70% compared to last year, with 2020 operating income up 163% compared to 2019. They are still massively exposed in China, which still doesn't seem priced in (share price rose ~10% after earnings release). Nokia releases earnings this week – if they meet or beat (consensus is a miss I believe), and particularly if they reinstate a dividend, Nokia could be seen a lot more favorably in the market. Alternatively, if it's a miss I still think it'll be a good buying opportunity for an expected earnings crush a quarter or two from now. [link] [comments]  |
| AMC: how much have the shorts covered? And do they have to? Posted: 30 Jan 2021 10:38 AM PST Please educate me. I've been reading a lot of info recently and while they are not conflicting, I have some trouble taking it all in. First, I see people saying options are expiring yesterday and next week with strike prices below market value. This means the market makers have to buy stocks and drive up the price. What I don't understand is, I thought the point of option are you don't have to exercise if it is unfavorable, so couldn't the market makers just not exercise. Secondly, I hear people saying shorts technically have no expiry date, they just have to pay a premium. What is to say they just wait the fomo out? Lastly, I've been seeing that there are like 4xx million volumes of AMC traded around which easily exceeds the number of shares shorted. Wouldn't this mean shorts are most likely covered? I know everyone is tired of this topic but this is a great learning opportunity for me, so please impart your wisdom. [link] [comments]  |
| Tesla service now includes collision repairs, fulfilling Elon Musk’s 2018 promise Posted: 30 Jan 2021 06:42 AM PST https://www.cnbc.com/2021/01/29/tesla-service-now-includes-collision-repairs.html Tesla notified customers on Friday that the company's service centers will now offer collision repairs, something CEO Elon Musk had been talking about since 2018. Tesla reported $678 million from a combined Services and Other segment during the fourth quarter of 2020, but the company does not break out services revenue discretely. Service has been a sore point for many Tesla owners and retail investors in recent months, to the point where a retail investor asked executives on their earnings call Wednesday what the company plans to do to improve the service experience. [link] [comments]  |
| Unpopular opinion: The events that unraveled this week were good for the retail investor Posted: 30 Jan 2021 07:03 AM PST TL;DR: Retail investors got a voice and the world saw the plain-view illegal acts of some brokerages/investment firms Before, the shady activity of the brokerages was hidden from the general public. They were able to manipulate the markets all they wanted and get away with it because the "commoners" didn't care or understand. Now, with millions of retain investors that flooded the market, a shift in "market influence" in favor of smaller, amateur traders. And the gargantuan, amorphous investment firms didn't like that at all. It has become a battle of market influence, and the hedge funds and brokerages with massive amounts of capital are doing WHATEVER IT TAKES (illegal or not) to make sure that they retain that authority that they previously held for so many years. (flooding certain stocks with short positions, disabling certain stocks) But with investment firms taking blatant illegal action to accomplish their goals, their shady activity has been revealed for the world to see and it seem as of now, that the general public, as well as some democrat lawmakers have taken an interest to them. (It also shows how corrupt the SEC is with them taking their sweet time to decide which side they want to be on) Hopefully through this incident, the integrity of the US markets can be improved with dishonest brokerages being dissolved. (I think it is wishful thinking that market makers such as Citadel could be dissolved, considering the HUGE number of brokerages with reliance to the company) [link] [comments]  |
| Posted: 30 Jan 2021 09:10 AM PST What? I could still get a 100% return even with a high stock price, how? There is nothing, absolutely nothing in the entire world that would ever keep GameStop's price at or above the levels they are today in the next 10 years. There was, however, 150% short interest on the float. Let's simplify this: You have 1 🍎 that you cut into 10 slices. 10 Slices are the outstanding shares. You give 2 🍎 slices to your friends and these become restricted. You go to a Farmer's Market and take your 8 🍎 slices with you to sell. This is the float. Someone comes along and thinks 🍎 prices will tank, so they want to short the market. They think it will tank so badly they want to short more than the total number of 🍎 that are available on the market. Hedge Funds can do this (for now). That seems crazy, what does it mean though? In order to short 🍎 a hedge has to "borrow" them. They pay interest on this. The longer time it takes for the price of an 🍎 to go down, the more interest they have to pay. Also, if the price of 🍎 skyrocket, the person who is lending out 🍎 might claw them back, forcing the shorter to pay a high price to close out their short. So when do I make $10,000 / share and retire? That's never going to happen...sorry. People are claiming if you set your limit sell order to an absurd number eventually a short has to buy it to cover. Most brokerages will limit the level above the strike you can set a limit. However, there is still a large % of the stock being shorted. It's possible that is several million of those shorts need to close, they would have to buy the stock at a very high price ($312.01 or possibly higher) and this would likely cause the stock to start climbing higher and higher as the shareholders don't want to sell their stock for a low price. Why did you say Gamestop was a terrible company: Gamestop is a terrible company. You literally have to be the biggest idiot in the world to think that Gamestop is worth more money than (throwing out a popular company name that is now smaller in market cap, BEST BUY). I've seen so many bandwagon investors with $5 in their trading account buying a fractional share because "the GameStop at my mall is always busy" And? Other genius ideas I've seen on Reddit:
Anyone with these ideas has no idea how a business functions, what a TAM (total addressable market) is, or has ever looked at the GameStop balance sheet from any of the past earnings reports. GameStop is a dying business, it is Blockbuster, it is Netflix had Netflix kept trying to mail people DvD's instead of streaming. Remember what happened to bc in 2017....that's going to happen with $GME at some point, it's not for certain when or how high the price could go before it comes down, but it will come down. If shorts closing out positions make the price go up, in order to cash out shareholders need to sell those shares. At a certain point, the shorts will be done and shareholders will be selling to others who think the price can keep going. Those people who don't understand anything about the market and just think they're going to make thousands or millions overnight are going to be the ones who end up losing virtually all of their investment if they got to the party late. Why can't GameStop be a good company, how do you know anything?
Remember, just because it's possible that the stock could go up due to the short interest, there is no guarantee it does. Don't risk more money than you're willing to lose and don't buy into a lot of the hype you read on Reddit. 99.99% of the people on here now throwing out financial advice don't know anything. Think about it. If you were so good at investing that you made a fortune...why would you tell other people how to do it? This would limit your ability to continue doing exactly what you do without being arbitraged by others. Positions: 1,000 shares of $GME most of which came from exercising option calls weeks to months ago. [link] [comments]  |
| AMC could've absolutely skyrocketed to $40-$50 last week, here's why it didn't. Posted: 30 Jan 2021 11:43 AM PST Disclaimers:
If not for 2 (major) events, last week I think that AMC stock could have gone to $50+. Let's recap the basics (per Yahoo & quarterly statements):
Balance Sheet (As of Q3 2020)
The major events were:
1A - $300M stock offering This was a share offering that added 100 Million shares to the market. It allowed AMC to sell shares directly to the public to raise cash to run the business. They got $300+ million in cash but were selling at under $5/share. This took the float from 100M to 160M shares. Up 60%. Because of the prior run up and buzz already starting, the was eaten up by the public without any significant change to the stock price. It probably should've risen a few bucks given they DILUTED 60%, but for time's sake I'll ignore since overall market cap was still low. 1B - $600 Million debt conversion to shares Overnight the stock was up 3-4x going into Wednesday dramatically increasing share price and market cap. They had a prior debt agreement which allowed for conversions from bonds into stock. Given the overnight increase in price, this was executed. Silver Lake obtained $600 million dollars worth of shares at the agreed price of ~$13. This was sold on the market during the morning. This translates to another 44M shares. If we take a look Wednesday's chart. We see they opened at $20, but immediately dropped to the day low of $11.01. This was likely due to newly available shares (and some sell off). The public was buying shares and stock rose to $17.50 before downward pressure (some sell off, also assume a second chunk of new shares. If we remove even half of these down trends (assuming the other half is profit taking), the stock should've closed at about $26. See these charts for a simple Before and After. 2 - Limited purchases We all know this part. In premarket the stock was up to $23 (Up another 15%), but opened at $12. I'm losing steam here, but imagine another 15% from yesterday's predicted 26 ($30 open). And clearly continued gain which started again Friday. but even still was impacted by return of restrictions by trading apps (There was another post with charts to back this up already, I wont repeat it). Overall:
TLDR: AMC diluted shareholders by $1B and 100M shares in two days. Without these extra 100M shares doubling the shares available, the stock would've risen DRAMATICALLY higher. This was compounded by trading apps preventing purchases. Additionally, shorts got diluted and now might estimated at just~20% of float. BE CAREFUL. Please correct me if I'm wrong on anything.... but I may not respond right away given my circumstances at home! Good luck to all, be cautious, and consider donating some of your profits to charities. [link] [comments]  |
| What're your opinions on the large amount of Instagram, Tik Tok etc, financial "influencers"? Posted: 30 Jan 2021 12:02 PM PST I've noticed recently a large influx of financial "influencers" almost shoving investment ideas down my throat. I can't help but think that their "influence" is a way to get some short term gains on the markets for themselves? What do you guys/gals think? [link] [comments]  |
| My prediciton on what will happen Posted: 30 Jan 2021 04:50 AM PST TLDR: this will fade out and nothing will change at all. ---- First of all, I am by no means a financial expert or claim to be one. I am successful at doing stuff with my money (avg return / year of well over 15%) and think I can handle myself. I also am 45 years old and have seen a few things here and there. I was also something you could call "an early adopter" when it comes to the internet, social media, etc etc. My predictions (or rather, opinions) are more or less based upon the latter two. So here we go. The current situation From what I gathered, there´s different types of people involved. And I am solely talking about the retailers here. The side of the whole thing that THINK, they got all the leverage.
those make up the people that pake part because they believe they finally have some say , some kind of leverage, some kind of power to force real change. whether it is changes to market rules, legal oversight, changes of law... you name it. those people have real conviction and are willing to see it through. 2. the investors there might be overlap to group 1., yet these people have actual believe , not only in the message being sent, but the company as well. you can argue all you want, but the fact is that GME brought in new, extremely committed and experienced management and was / is in the phase of a corporate change. it might take them years and it might fail, but there is a chance they might pull it off. group 2 believes in this, hence the investment into it. 3. the traders they see this purely as a chance of having one of the best chance of high yield return of their lifetime (which is not wrong at all). they might also believe that they help the world become a better place to justify their behavior, which is also ok. yet they are mainly in for the gains. they are rather rational about the situation and simply wait for thee right moment. the only thing that sets them apart from 4, is their actual rational response to the situation 4. the hyper. those people jump on the bandwagon simply because it is happening. the same people will spread their money around, buying AMC, doge or even silver right now. they lack the understanding or they lack interest and patience to really try to understand the situation at all. they want clout, ganis, or- the best - they want both. some are even stupid enough to sell all they have, luquidate whatever available and pour everything into one stock, if the hype is big enough. Prediction group 4: trends change, sentiments and rationales change. they were never so easy to manipulate as well. most people will get bored , or simply jump on the next bandwagon. this means, 4 will skip the train as soon as the holding battle simply takes too long for their attention span. if you do not have the cashflow to actively be involved in regards to buying more when the price warrants it, you got nothing to do but wait and be patient. which is a concept very hard to grasp when you are trying to keep up with ery single hypetrain out there. and since they all over sudden realize that they got all their assets into one thing thats not doing anything, they will simply pull out sooner rather than later. at one point in the normal market fluctuation they will set their limits lower than anticipated and just jump ship. group 3 will eventually do the same, just a little later, simply because they understand the situation better and have much smarter goals. they are in it for the returns. right now they might not be 100% sure what target that is, but they will form a decision really soon. remember, they were never in it for the long run... group 2 group 1: they are saying they will ride it out until the end. which is great. so what does all this mean: people underestimate how markets work, what strings will and can be pulled. they overestimate patience and conviction. also, people TOTALLY and utterly fail to understand the core principle of greed, which drives most of the groups mentioned here. once the price of each individual involved is reached, the cookie WILL start to crumble. for some its 500, for most it might be 750, 1000 dollars. who knows. but this is no situation that will be going on for weeks. this will fade out. simply because most people lose interest or see their chances of high returns dwindling. or they need their money for other investments. or they suddenly realize that putting all this money into something that doesnt pan out wasn´t so smart afterall. OVERALL I sincerely hope changes will come- and they probably will. The current situation clearly exposed how markets are worked and how they operate on a level of transparency, that only happened in 2008. so how did things change after 2008 ? now think about the ramifications of 2008 compared to this. now try to think - rationaly - how realistic it is that actual , FUNDAMENTAL changes are being established and put into action ? do you really think they will make short sales illegal ? do you really think they will make naked sales illegal ? do you think they will make fundamental changes to what the SEC actually controls and how they do it ? seriously ? the only thing that will come from this, MIGHT be: - better(harsher) regulations for retail trading platforms - harsher regulations regarding market manupilations through means of social media - a wealth tax for the super rich. why this ? because it is easy to sell to the public, build hype and support upon it. will it change anything ? of course not. Oh wait, yes it will. it will make it harder for retail traders. it will make it harder for us. more regulations for trade providers means more costs at providing services means no free trading apps anymore. hard to make a buck for trading apps when you cannot sell trade information of your customers to market makers anymore. we already are being censored more and more. words are flagged, opinions are flagged, and sooner or later, forums, and whole platforms will be flagged. and then closed and called illegal. its already happening in regards to other platforms. Not that I really care or support anyone using sovial media for dusgusting and absurd poilitical reasons and opinions, but censoring and de-legalizing it is still censorship. thats not something that can be good any democracy. and a wealth tax for the super rich? that´s like revers trickle down ecomomics. instead of thinking when they have all their money it will trickle down, we just make sure they pay for it once they have it. it disregards the fact that simply ba having money, they also have the means to pay lawyers a few millions to find ways they do not have to pay even more millions to pay their taxes. its what´s already happening. this will not help the small , average Joe [link] [comments]  |
| Are you hedging your portfolio in anticipation for next week? Posted: 30 Jan 2021 09:39 AM PST So, with everything going on with GME, the rest of my portfolio is absolutely killed. I do own a little gme, but not enough to amount to over a year of work investing. My thoughts are- is anyone hedging? Selling & re entering at a better cost? I would love to know. I read an article that mark cuban is "hedging the heck" out of his portfolio. I don't wanna lose everything I've made in individual stocks (my VTSAX, ICLN, ARKK - I will likely just hold) [link] [comments]  |
| Posted: 30 Jan 2021 09:00 AM PST Something stood out to me from the Mox Reports summary of the 2008 VW squeeze (I know, we've all read it, it's not a fair comparison to the GME squeeze, all the usual caveats) - it seemed like a fairly important thing: "Confusion over "short vs. float". Prior to the announcement from Porsche, and as the financial crisis was becoming more apparent, short interest in VW had been steadily rising. But even by October 2008, the short interest seemed not excessive, at just 12.8% of outstanding shares. But what the market failed to appreciate was that the true availability of tradeable shares to cover those short positions was actually far lower than what many understood." Read that last part again, about what made the short squeeze so dangerous. "What the market failed to appreciate was that the true availability of tradeable shares to cover those short positions was actually far lower than what many understood." In the case of GME, the current usage % of float is 100%. (From Ortex data, it has been at 100% for the last several months). All shares of free float are either being held, or loaned. As large institutional players buckle down for a massive staring contest, the shorts hold the losing position. Basically, let's face it - the retail investor can provide pushes to the market, but we do not have collectively have the capital for sustained attacks from coordinated interests. There are institutions on the retail investor's side - they're also interested in buying and holding the stock. They like the stock. It costs nothing to hold. The short interest at the time was about 12% of float ... compared to our current estimates from as low as ~75% - 120% of float, depending on your sources. (It's 75% according to Ortex, and 113% according to S3 Partners) The current availability of tradeable shares, though is... 0%. I think it was as low as like, 1% in the VW squeeze. I thought this seemed worth discussing. What are the implications of 100% Utilization? Does it matter? Or are the two scenarios so disparate that it's not something that's merited discussion? Just curious. Here to learn. [link] [comments]  |
| Investing in GME is not guaranteed free money Posted: 30 Jan 2021 01:43 PM PST I've seen lots of stories about retail investors liquidating their portfolios to participate in the short squeeze of gamestop. This may have started as retail vs hedge fund, but by now, it's definitely retail and hedge funds vs hedge funds. There is incredibly smart money, willing to trade emotionlessly with perfect information and bots in a battle of timing on both sides of this trade. The fact that it closed at $200/share on Thursday means hedge funds with near infinite money were thinking it's probably not worth participating in the short squeeze for more than $200/share. The pros didn't think it was guaranteed money at $200/share and the pros never turn down guaranteed free money. That should bring great caution to anyone still looking to get in. What will likely happen is it will end up selling for large amounts per share for a very short amount of time, and then very rapidly crater in price. Hedge funds on the long side of the trade will be able to execute their sells near perfectly, and retail traders will likely be bag holders after it craters who don't have access to bots for perfectly executed sells. Another possibility is there is no pop, remember, the hedge funds didn't buy up all the shares at $200 and just wait for it to climb to $250. They didn't think it was guaranteed to go to $250, which would be well under a pop level. This is just my opinion, but I'd exercise great caution before touching this with a 10 foot pole at these prices, and definitely not with any meaningful amount of money. I'd also strongly consider cashing some out if you are already in. Ask yourself how you'd feel if you lost 90% of the current value of your gme shares, as that's a very reasonably likely outcome for the non-pros, imo. [link] [comments]  |
| Can't the hedge funds just hold forever? $GME Posted: 30 Jan 2021 01:35 PM PST Yo guys, i know i'm probably gonna get downvoted to oblivion for this but i'm trying to make some sense out of this situation and find out as much information as possible to make this easier to understand. But isn't it a possibility that the hedge funds hold forever? The hedge funds are currently paying a fee of about ~16 million dollars a day if my math and information is correct (30% fee on 330 = 99 dollars, 99 x 60 million shares / 365 = ~16 million dollars) This sum is nothing for these hedge funds since the other alternative they've got is to go bankrupt if they decide to start buying shares back. This is a fight for their survival which means they will hold until they die, why would they surrender now and bankrupt themselves? And since the float is so low they can continue doing their short attacks to push the price down and pay even smaller fees. So what's says that the short squeeze will come even this year? They will continue to bleed money until they are eventually forces to cover but that could take months, and eventually people will tire out and start selling which will crash the price and they'll win? I'm far from an expert in this area but i'm just trying to understand how we can force them to start covering their positions with fees this low and with the brokers and market makers on their side it's easier for them to shut us down? Cheers! [link] [comments]  |
| Can we please stop the misinformation Posted: 30 Jan 2021 01:35 AM PST so I posted this before and ill try again with a slightly different tone, but the state of investing on Reddit has turned into some mass Qanon misinformation shit dump. I have reason to believe the hedge funds did not in fact instruct the brokers to halt trading, but last time I posted this I got 60 comments and one agreeing with me, so I think its better people hear it from wsb, and please read the damn post that I will link, here it is Edit- also as a side note fuck musk, fuck chamath, fuck Dave portnoy, fuck the winklevoss twins, and fuck any celebrity or famous person who eggs on the misinformation, they know better and are using people Edit 2- don't think this is me defending the hedge funds for shorting over 100%, it should not be allowed it is reckless and stupid, and since this issue somehow has to do with me defending billionares, note I am not [link] [comments]  |
| A little insight needed please Posted: 30 Jan 2021 11:33 AM PST Ok. I'm educated (MBA Finance & Accounting). With that said I pay someone to manage my funds. It's not my strength. I found myself watching FBN, CNBC, and other financial shows. During this I'm hearing "experts" drone on how retail investors don't know what they are doing and should essentially be refused service since they aren't financially savvy as the insiders. It's almost like they are pissed that their algorithms and "fundamentals" don't work outside their perfect little bubble. It feels like elitism, classism, or said differently like indignant rich people are pissed that someone is playing in their sand box. Can someone help me make sense of this? Am I reading this right or am I missing something. Help please. [link] [comments]  |
| Posted: 30 Jan 2021 12:58 PM PST [I am all over the place and my mind is racing. My apologies.] If/when this Gamestop (GME) bubble pops. It could mean that there could be a scramble to sell stocks to cover the shorts. The government may be able to stop the GME bubble popping somehow. I think that the government should let the GME bubble pop (likely in favor of those going long) by not interfering, and not on the side of the initiating hedge funds going short. Apparently Gamestop can just issue more shares to mitigate the bubble popping. I expect that they will, this is a no brainer. Gamestop almost certainly does not have enough stock to stop it from popping (or do they?). The INITIATING hedge funds, the short side, might win by outlasting the opposition. But is is apparently ALOT more expensive and risky for the initiating short side hedge funds. There are hedge funds on the other side. Billionaires on each side. The long side of the GME bubble seems more likely to pop to me. If the GME bubble pops in favor the the long investors, then all the stocks will likely drop. I wonder how big the drop would be. Could this GameStop (GME) bubble be what pops the stock market bubble that Jeremy Grantham says that we are currently in? I am not a professional. I think 100% cash might be the correct move until this GameStop thing blows over. Then we see. If no market as a whole bubble pop, then 70% cash/bonds 30% stock (industrials) until a bubble pop (maybe never, but I take Jeremy Grantham seriously). After a bubble pop 100% stock (if in the near future, then heavy in industrials). The millennials should be able to take it from there. The millennials should be able to make a roaring economy all by themselves in legion. We would also see stock market reform, a lot more if the market as a whole pops. [link] [comments]  |
| Could GME really have a large impact on the overall markets? Posted: 30 Jan 2021 01:59 PM PST Most of my portfolio and watchlist went red after GME's rise. Was thinking about how Gamestop's stock could impact the market if hedge funds lose money and have to pull out of other stocks. Is it possible that what is happening now can cause the market to crash? [link] [comments]  |
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