[GameStop GME trading mega-thread]

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deanbrew
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Re: GameStop GME: anyone joining?

Post by deanbrew »

Gadget wrote: Wed Jan 27, 2021 3:10 pm

This is next level diamond hands. 11 years lol. You've gotta post those sell order screenshots with the purchase date on /r/wsb. They'll love that.
I had to do a web search to find out what "diamond hands" means. I suppose the term applies to me, as I have held onto stocks and watched them tumble down and down... Or up and up, never selling. To be honest, GME is one of them. I watched it go up and down and up and down and never sold for either a profit or loss. I've figured out that (for me, at least) it's easy to buy stocks, but hard to sell them.

I haven't bought many individual stocks in recent years, but it is fun to dabble with a very small portion of my portfolio.
"The course of history shows that as the government grows, liberty decreases." Thomas Jefferson
Tester83
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Re: GameStop GME: anyone joining?

Post by Tester83 »

alfaspider wrote: Wed Jan 27, 2021 3:14 pm
fallingeggs wrote: Wed Jan 27, 2021 3:11 pm With daily (or, in GME's case, hourly) cash margin, the shorts don't have an choice not to cover; the investment banks that facilitate the short will force the cover at some point. In fact, the main hedge funds targeted (Melvin, Citron, etc) covered this morning with losses well into the billions. See yet another 100%+ jump just today! I think this is now a long-only hot potato.

For what it is worth, if there is ever an accounting of what happened , I suspect the majority of the money injected into this over the last few days is from other hedge funds. They are always keen on a good short squeeze, even if started by Reddit.
I guess that's the key question. There seem to be a lot of conflicting reports about the short positions that are still open.
Correct. Many do not believe Melvin closed because, if their position is that significant, it would have freed up a lot more shares for borrowing. Doesn't seem like the short interest decrease or the borrowed shares increased. https://iborrowdesk.com/report/GME

IMO, I think shorts keep on borrowing and borrowing from anyone willing to lend in desperate hopes of riding it out. I imagine any investigation into this will review the daisy-chain of share lending to see exactly how far out people have been lending their shares, and whether that's causing settlement issues.
Ocean77
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Re: GameStop GME: anyone joining?

Post by Ocean77 »

Tester83 wrote: Wed Jan 27, 2021 3:00 pm Retail is waiting for that squeeze (the theory being it will be obvious when the short squeeze happens because the stock will rapidly increase in price as these shorts fall in line to liquidate their positions, desperate not to be the last one to close).
Your post all makes sense to me, but this part has me wondering: I thought GME going up to $350 is the result of a short squeeze already, driven up by short sellers covering their position. You're saying the actual short squeeze is yet to come, and the price got up to this point just by wsb folks buying?
totality
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Re: GameStop GME: anyone joining?

Post by totality »

fwellimort wrote: Wed Jan 27, 2021 2:14 pm
Oregano wrote: Wed Jan 27, 2021 2:13 pm You do realize that GME is going to drop 90% from the current price at some point, right? Buying right now in the hopes that you are not the one who loses 90% is exactly what speculation means.
Not my fault hedge funds shorted 140% of available shares (how the hell is >100% even allowed?). Those shares need to be bought up. And guess what, it's the retail investors that have it.

The losers of this are the hedge funds if individuals as a whole don't mostly play stupid for small gains.
There's nothing wrong with having >100% of shares shorted. See here for an explanation: viewtopic.php?f=10&t=337398&start=50#p5761889
Gadget
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Re: GameStop GME: anyone joining?

Post by Gadget »

alfaspider wrote: Wed Jan 27, 2021 3:14 pm
fallingeggs wrote: Wed Jan 27, 2021 3:11 pm With daily (or, in GME's case, hourly) cash margin, the shorts don't have an choice not to cover; the investment banks that facilitate the short will force the cover at some point. In fact, the main hedge funds targeted (Melvin, Citron, etc) covered this morning with losses well into the billions. See yet another 100%+ jump just today! I think this is now a long-only hot potato.

For what it is worth, if there is ever an accounting of what happened , I suspect the majority of the money injected into this over the last few days is from other hedge funds. They are always keen on a good short squeeze, even if started by Reddit.
I guess that's the key question. There seem to be a lot of conflicting reports about the short positions that are still open.
I suspect this as well. Reddit doesn't have enough money to move this stock so much. But a hedge fund piling in with Reddit? To the moon...

I'd be looking at every hedge fund that lost out on some trade with Melvin Capital or Citron. They probably have better access to real shorting volume and data, and are pouncing on this to try to help Reddit take their enemy out of the competition.
alfaspider
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Re: GameStop GME: anyone joining?

Post by alfaspider »

Ocean77 wrote: Wed Jan 27, 2021 3:22 pm
Tester83 wrote: Wed Jan 27, 2021 3:00 pm Retail is waiting for that squeeze (the theory being it will be obvious when the short squeeze happens because the stock will rapidly increase in price as these shorts fall in line to liquidate their positions, desperate not to be the last one to close).
Your post all makes sense to me, but this part has me wondering: I thought GME going up to $350 is the result of a short squeeze already, driven up by short sellers covering their position. You're saying the actual short squeeze is yet to come, and the price got up to this point just by wsb folks buying?
There has to have been some short covering going on given the sudden vertical spikes (especially after close yesterday). But the WSB folks insist that the short positions are still open and that the shorts are in fact doubling down.
as9
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Re: GameStop GME: anyone joining?

Post by as9 »

Ocean77 wrote: Wed Jan 27, 2021 3:22 pm
Tester83 wrote: Wed Jan 27, 2021 3:00 pm Retail is waiting for that squeeze (the theory being it will be obvious when the short squeeze happens because the stock will rapidly increase in price as these shorts fall in line to liquidate their positions, desperate not to be the last one to close).
Your post all makes sense to me, but this part has me wondering: I thought GME going up to $350 is the result of a short squeeze already, driven up by short sellers covering their position. You're saying the actual short squeeze is yet to come, and the price got up to this point just by wsb folks buying?
It’s well beyond WSB at this point. It’s international news, Chamath got in, Elon tweeted about it. Elon’s tweet is what sent it flying after hours yesterday.
Scooter57
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Re: GameStop GME: anyone joining?

Post by Scooter57 »

Gadget wrote: Wed Jan 27, 2021 3:25 pm I suspect this as well. Reddit doesn't have enough money to move this stock so much. But a hedge fund piling in with Reddit? To the moon...

I'd be looking at every hedge fund that lost out on some trade with Melvin Capital or Citron. They probably have better access to real shorting volume and data, and are pouncing on this to try to help Reddit take their enemy out of the competition.
It isn't just hedge funds. Lots of investors have been following wallstreetbets since they pushed TSLA "to the moon, hoping to get in on the next big thing. There was a very compelling case here given the ridiculously high short interest.

But that said, the heavy use of options gives many of these traders the ability to force market makers to buy stock. I discussed the Bloomberg article explaining how that works in this post viewtopic.php?f=10&t=337913 . In the example given, a $1,500 call option buy forces the purchase of almost a quarter of a million dollars worth of stock.
bogledogle87
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Re: GameStop GME: anyone joining?

Post by bogledogle87 »

alfaspider wrote: Wed Jan 27, 2021 3:26 pm
Ocean77 wrote: Wed Jan 27, 2021 3:22 pm
Tester83 wrote: Wed Jan 27, 2021 3:00 pm Retail is waiting for that squeeze (the theory being it will be obvious when the short squeeze happens because the stock will rapidly increase in price as these shorts fall in line to liquidate their positions, desperate not to be the last one to close).
Your post all makes sense to me, but this part has me wondering: I thought GME going up to $350 is the result of a short squeeze already, driven up by short sellers covering their position. You're saying the actual short squeeze is yet to come, and the price got up to this point just by wsb folks buying?
There has to have been some short covering going on given the sudden vertical spikes (especially after close yesterday). But the WSB folks insist that the short positions are still open and that the shorts are in fact doubling down.
I think the dissemination of the information in real time is pretty key here. What do you trust? WSB thinks the original shorts have not covered yet and are simply lying. Furthermore, additional shorts are being bought up at the current ridiculous price. Meanwhile, everyone is snatching up shares and calls thinking it's just getting started. This is going to be a very spectacular ending.
VTWAX and chill
SundayMorning
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Re: GameStop GME: anyone joining?

Post by SundayMorning »

My son climbed aboard the roller coaster last week. He bought at around $65 and sold at $250-ish. He now has his down payment for a house in the Spring. Not bad for 4 or 5 days of watching your phone. Walked away with more than his annual salary.

I threw $500 at it Monday morning to entertain myself this week. I may let this ride until Friday to see where this goes. :sharebeer
Tester83
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Re: GameStop GME: anyone joining?

Post by Tester83 »

bogledogle87 wrote: Wed Jan 27, 2021 3:34 pm
alfaspider wrote: Wed Jan 27, 2021 3:26 pm
Ocean77 wrote: Wed Jan 27, 2021 3:22 pm
Tester83 wrote: Wed Jan 27, 2021 3:00 pm Retail is waiting for that squeeze (the theory being it will be obvious when the short squeeze happens because the stock will rapidly increase in price as these shorts fall in line to liquidate their positions, desperate not to be the last one to close).
Your post all makes sense to me, but this part has me wondering: I thought GME going up to $350 is the result of a short squeeze already, driven up by short sellers covering their position. You're saying the actual short squeeze is yet to come, and the price got up to this point just by wsb folks buying?
There has to have been some short covering going on given the sudden vertical spikes (especially after close yesterday). But the WSB folks insist that the short positions are still open and that the shorts are in fact doubling down.
I think the dissemination of the information in real time is pretty key here. What do you trust? WSB thinks the original shorts have not covered yet and are simply lying. Furthermore, additional shorts are being bought up at the current ridiculous price. Meanwhile, everyone is snatching up shares and calls thinking it's just getting started. This is going to be a very spectacular ending.
The prevailing theory is that the actual squeeze has not happened, and that the current price is simply a result of very simple supply/demand mechanics (i.e., there's a huge demand for shares to either cover shorts/calls OR take advantage of the squeeze vs. a dwindling supply of shares because of Retail "DIAMOND HANDS").

The prevailing theory is that shorts have not covered simply because none of the indicators show a significant drop in SI. For example:

https://www.reddit.com/r/wallstreetbets ... ame=iossmf

Absolutely agree: the critical factor is the validity of the short interest information available to the public.
Gadget
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Re: GameStop GME: anyone joining?

Post by Gadget »

Tester83 wrote: Wed Jan 27, 2021 3:38 pm
bogledogle87 wrote: Wed Jan 27, 2021 3:34 pm
alfaspider wrote: Wed Jan 27, 2021 3:26 pm
Ocean77 wrote: Wed Jan 27, 2021 3:22 pm
Tester83 wrote: Wed Jan 27, 2021 3:00 pm Retail is waiting for that squeeze (the theory being it will be obvious when the short squeeze happens because the stock will rapidly increase in price as these shorts fall in line to liquidate their positions, desperate not to be the last one to close).
Your post all makes sense to me, but this part has me wondering: I thought GME going up to $350 is the result of a short squeeze already, driven up by short sellers covering their position. You're saying the actual short squeeze is yet to come, and the price got up to this point just by wsb folks buying?
There has to have been some short covering going on given the sudden vertical spikes (especially after close yesterday). But the WSB folks insist that the short positions are still open and that the shorts are in fact doubling down.
I think the dissemination of the information in real time is pretty key here. What do you trust? WSB thinks the original shorts have not covered yet and are simply lying. Furthermore, additional shorts are being bought up at the current ridiculous price. Meanwhile, everyone is snatching up shares and calls thinking it's just getting started. This is going to be a very spectacular ending.
The prevailing theory is that the actual squeeze has not happened, and that the current price is simply a result of very simple supply/demand mechanics (i.e., there's a huge demand for shares to either cover shorts/calls OR take advantage of the squeeze vs. a dwindling supply of shares because of Retail "DIAMOND HANDS").

The prevailing theory is that shorts have not covered simply because none of the indicators show a significant drop in SI. For example:

https://www.reddit.com/r/wallstreetbets ... ame=iossmf

Absolutely agree: the critical factor is the validity of the short interest information available to the public.
This is why I paper handed a decent chunk at $380 a share today. I believe /r/wsb is right on the theory. I think Citron and Melvin saying they got out is a complete lie. What I can't tell is if the screenshots of estimated short interest that /r/wsb is using are accurate. And can the hedge funds work in cahoots to have one player get rid of their short interest while another instantly scoops it up when the stock is at ATH? I'm not sure.
alfaspider
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Re: GameStop GME: anyone joining?

Post by alfaspider »

Decided against holding overnight and took my paltry gains (bought at $303 and sold at $342). I'm not really a gambler at heart, paper hands and all that :mrgreen:

But hey, I got my participation trophy.
Last edited by alfaspider on Wed Jan 27, 2021 4:16 pm, edited 1 time in total.
benihanna
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Re: GameStop GME: anyone joining?

Post by benihanna »

Gadget wrote: Wed Jan 27, 2021 3:43 pm This is why I paper handed a decent chunk at $380 a share today. I believe /r/wsb is right on the theory. I think Citron and Melvin saying they got out is a complete lie. What I can't tell is if the screenshots of estimated short interest that /r/wsb is using are accurate. And can the hedge funds work in cahoots to have one player get rid of their short interest while another instantly scoops it up when the stock is at ATH? I'm not sure.
That data is pretty easy to pull I thought?
https://finviz.com/quote.ashx?t=GME
Tester83
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Re: GameStop GME: anyone joining?

Post by Tester83 »

benihanna wrote: Wed Jan 27, 2021 3:54 pm
Gadget wrote: Wed Jan 27, 2021 3:43 pm This is why I paper handed a decent chunk at $380 a share today. I believe /r/wsb is right on the theory. I think Citron and Melvin saying they got out is a complete lie. What I can't tell is if the screenshots of estimated short interest that /r/wsb is using are accurate. And can the hedge funds work in cahoots to have one player get rid of their short interest while another instantly scoops it up when the stock is at ATH? I'm not sure.
That data is pretty easy to pull I thought?
https://finviz.com/quote.ashx?t=GME
What people are really waiting for is the NYSE short interest report, which comes out every two weeks:
I believe your link, specifically, refers to two-week old data.

I think the next one comes out today after the markets close? I'm not sure.
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JonnyDVM
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Re: GameStop GME: anyone joining?

Post by JonnyDVM »

I'm still holding, I'll see the rest of you apes back here on the moon tomorrow
I’d trade it all for a little more | -C Montgomery Burns
CrossOverGuy
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Re: GameStop GME: anyone joining?

Post by CrossOverGuy »

There's a GameStop store near Macy's by 34th Street in NYC, and I've never seen it very crowded before. In fact, I thought it had gone out of business last time I walked by a couple of weeks ago. I don't see this as having been more than a "niche" kind of store.

Question: With all this momentum with short selling and people trying to pump and dump, this stock, AMC, and some others, etc., same it seems with things like bitcoin, does it affect very much index funds on the whole? I realize that the markets are way down today, but it's been so high lately, it's been bound to dip some, but these in the news stocks are only a very small part of these indexes. I had just rebalanced back to my preferred asset allocation into bonds the other day and am trying to ignore the noise for the most part, but would like your feedback. Thanks.
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arcticpineapplecorp.
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Re: GameStop GME: anyone joining?

Post by arcticpineapplecorp. »

https://www.cnbc.com/2021/01/27/tilray- ... osses.html

anyone remember tilray?

i assume I'll be asking if anyone remembers GME in a few years when wallstreetbets or whatever exists at that time pumps up the next new shiny object.

bank of america analyst sees gme fall 97%:
https://www.fool.com/investing/2021/01/ ... ck-plungi/

that's $10/share:
https://www.benzinga.com/analyst-rating ... side-to-10
It's hard to accept the truth when the lies were exactly what you wanted to hear. Investing is simple, but not easy. Buy, hold & rebalance low cost index funds & manage taxable events.
hnd
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Re: GameStop GME: anyone joining?

Post by hnd »

alfaspider wrote: Wed Jan 27, 2021 3:52 pm Decided against holding overnight and took my palty gains (bought at $303 and sold at $342). I'm not really a gambler at heart, paper hands and all that :mrgreen:

But hey, I got my participation trophy.
Bought at 60 and 90. I just sold half my position. Nothing big, will pay for a few fishing gadgets. i took out 3x what i put in. the rest is just to be able to tell my grandkids someday how stupid their pop pop was.
totality
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Re: GameStop GME: anyone joining?

Post by totality »

Tester83 wrote: Wed Jan 27, 2021 3:38 pm The prevailing theory is that the actual squeeze has not happened, and that the current price is simply a result of very simple supply/demand mechanics (i.e., there's a huge demand for shares to either cover shorts/calls OR take advantage of the squeeze vs. a dwindling supply of shares because of Retail "DIAMOND HANDS").

The prevailing theory is that shorts have not covered simply because none of the indicators show a significant drop in SI. For example:

https://www.reddit.com/r/wallstreetbets ... ame=iossmf

Absolutely agree: the critical factor is the validity of the short interest information available to the public.
Alternate theory: Melvin Capital is not lying, and actually did close their position, and the remaining high short interest is due to the shares Melvin returned to their owners being instantly shorted by other players.

WSB is quite hard to take seriously when they jump instantly to conspiracy theories and accusations of fraud when there are reasonable alternative explanations.
fallingeggs
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Re: GameStop GME: anyone joining?

Post by fallingeggs »

I wonder if publicly lying that you closed your short in an effort to stop the squeeze is securities fraud?
Tester83
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Re: GameStop GME: anyone joining?

Post by Tester83 »

totality wrote: Wed Jan 27, 2021 4:12 pm
Tester83 wrote: Wed Jan 27, 2021 3:38 pm The prevailing theory is that the actual squeeze has not happened, and that the current price is simply a result of very simple supply/demand mechanics (i.e., there's a huge demand for shares to either cover shorts/calls OR take advantage of the squeeze vs. a dwindling supply of shares because of Retail "DIAMOND HANDS").

The prevailing theory is that shorts have not covered simply because none of the indicators show a significant drop in SI. For example:

https://www.reddit.com/r/wallstreetbets ... ame=iossmf

Absolutely agree: the critical factor is the validity of the short interest information available to the public.
Alternate theory: Melvin Capital is not lying, and actually did close their position, and the remaining high short interest is due to the shares Melvin returned to their owners being instantly shorted by other players.

WSB is quite hard to take seriously when they jump instantly to conspiracy theories and accusations of fraud when there are reasonable alternative explanations.
People review sites like https://iborrowdesk.com/report/GME in real time to estimate the level of shares available to short. Again, the theory is that Melvin didn't close their position because, if it truly was a significant position, the amount of shares available to short would have significantly risen and reported. Most haven't seen that.

Yeah, some WSB theories are pretty out there. Honestly, I doubt there's a "massive" conspiracy by the system (hedges, banks, MMs, media, regulators) to defeat WSB because, really, all the conspirators had to do to quell the surge is put out reliable reporting that the short interest isn't has high as they think it is. As soon as enough people believe that, the mad rush to the exits will begin.

I'm assuming they can't because enough publicly available data to dispute that is readily available.
Jags4186
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Re: GameStop GME: anyone joining?

Post by Jags4186 »

u/DFV has parlayed $50k into $47mm as of today. He has $13mm in cash.

Unreal.
alfaspider
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Re: GameStop GME: anyone joining?

Post by alfaspider »

Jags4186 wrote: Wed Jan 27, 2021 4:28 pm u/DFV has parlayed $50k into $47mm as of today. He has $13mm in cash.

Unreal.
I'm curious if anybody has figured out who DFV is, and whether he/she will be outed. If identified, there could be a hollywood movie in the cards :mrgreen:
Gadget
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Re: GameStop GME: anyone joining?

Post by Gadget »

Jags4186 wrote: Wed Jan 27, 2021 4:28 pm u/DFV has parlayed $50k into $47mm as of today. He has $13mm in cash.

Unreal.
Good for him. He's now got $13 mil, even if he diamond hands the rest of his $47mil to zero. I was worried for him when he just had 1-2 mil in cash.

$13 mil though? Pretty sure he can retire and live like a king off that.
langlands
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Re: GameStop GME: anyone joining?

Post by langlands »

alfaspider wrote: Wed Jan 27, 2021 4:31 pm
Jags4186 wrote: Wed Jan 27, 2021 4:28 pm u/DFV has parlayed $50k into $47mm as of today. He has $13mm in cash.

Unreal.
I'm curious if anybody has figured out who DFV is, and whether he/she will be outed. If identified, there could be a hollywood movie in the cards :mrgreen:
He's Roaring Kitty on youtube.
Gadget
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Re: GameStop GME: anyone joining?

Post by Gadget »

alfaspider wrote: Wed Jan 27, 2021 4:31 pm
Jags4186 wrote: Wed Jan 27, 2021 4:28 pm u/DFV has parlayed $50k into $47mm as of today. He has $13mm in cash.

Unreal.
I'm curious if anybody has figured out who DFV is, and whether he/she will be outed. If identified, there could be a hollywood movie in the cards :mrgreen:
Search for Roaring Kitty on youtube. You can listen to him do 7 hour live streams about gamestop. He looks like a normal nerdy 30ish year old.

I watched some CNBC and someone called out for DFV to be investigated by the SEC. He'll be the last person that gets in trouble. He's literally been posting videos on youtube and posts on reddit about his theory and position for over a year now. It's all out in the open. I think he was even only 1 month off from calling the date of when the short squeeze was likely... months ago. If he gets in trouble for anything, it will be because he has a time machine.
Samosa22
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Re: GameStop GME: anyone joining?

Post by Samosa22 »

He. Is. Still. In.
Diversification is protection against ignorance - WB.
rhoms33
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Re: GameStop GME: anyone joining?

Post by rhoms33 »

Legend. He's still in - I'm still in.
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HomerJ
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Re: GameStop GME: anyone joining?

Post by HomerJ »

CrossOverGuy wrote: Wed Jan 27, 2021 4:03 pm Question: With all this momentum with short selling and people trying to pump and dump, this stock, AMC, and some others, etc., same it seems with things like bitcoin, does it affect very much index funds on the whole? I realize that the markets are way down today, but it's been so high lately, it's been bound to dip some, but these in the news stocks are only a very small part of these indexes. I had just rebalanced back to my preferred asset allocation into bonds the other day and am trying to ignore the noise for the most part, but would like your feedback. Thanks.
This is a great question.

I knew the housing market was stupid crazy back in 2007-2008, but I figured it wouldn't affect me since I had my house and mortgage.

But of course it did.

I don't really care about bitcoin or GME or any of this other craziness, and I assume I can ignore it and it won't affect me.

But maybe I'm wrong again.
A Goldman Sachs associate provided a variety of detailed explanations, but then offered a caveat, “If I’m being dead-### honest, though, nobody knows what’s really going on.”
csmath
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Re: GameStop GME: anyone joining?

Post by csmath »

fallingeggs wrote: Wed Jan 27, 2021 4:18 pm I wonder if publicly lying that you closed your short in an effort to stop the squeeze is securities fraud?
The question is, did they lie? Did they say they covered ALL of their short position(s)? Not interested enough to look but I'm guessing they said they "closed short positions". That is nowhere near the same thing as saying they "have no short positions left".
alfaspider
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Re: GameStop GME: anyone joining?

Post by alfaspider »

HomerJ wrote: Wed Jan 27, 2021 4:56 pm
CrossOverGuy wrote: Wed Jan 27, 2021 4:03 pm Question: With all this momentum with short selling and people trying to pump and dump, this stock, AMC, and some others, etc., same it seems with things like bitcoin, does it affect very much index funds on the whole? I realize that the markets are way down today, but it's been so high lately, it's been bound to dip some, but these in the news stocks are only a very small part of these indexes. I had just rebalanced back to my preferred asset allocation into bonds the other day and am trying to ignore the noise for the most part, but would like your feedback. Thanks.
This is a great question.

I knew the housing market was stupid crazy back in 2007-2008, but I figured it wouldn't affect me since I had my house and mortgage.

But of course it did.

I don't really care about bitcoin or GME or any of this other craziness, and I assume I can ignore it and it won't affect me.

But maybe I'm wrong again.
I guess the question is whether there's some unseen systemic risk arising out of BTC or crowdsourced stock manias.
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dmcmahon
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Re: Help me set a Sell limit order for GME (GameStop)

Post by dmcmahon »

rich126 wrote: Wed Jan 27, 2021 1:45 pm
dmcmahon wrote: Wed Jan 27, 2021 12:42 pm
MishkaWorries wrote: Wed Jan 27, 2021 12:33 pm
dukeblue219 wrote: Wed Jan 27, 2021 12:26 pm
ponyboy wrote: Wed Jan 27, 2021 11:59 am Why is their stock exploding?
It was over 100% sold short. The internet decided to manipulate it and destroy the shorts, then some activist types joined in. Check the news ;)
So the shorts got greedy and now they are taking it in the shorts. My heart bleeds.
I can’t figure out why we even allow short selling. Unlimited loss potential. If you have a negative opinion on a stock don’t buy it. If you want to bet against it, buy puts or sell calls. If uncovered calls are allowed to be sold, then the rules of the casino need to be written so as to allow the seller to buy them back at the closing price at expiry in lieu of delivering shares. JMHO.
I'm guessing that the biggest short sellers are not individual investors but are hedge funds and others with large sums of money.

As a smaller investor, if I really thought something would fall, I wouldn't short it but instead would buy put options on it.
The unlimited loss potential is certainly a valid concern.

The GME story sounds like it would be a good lesson in a finance class. Detailing what all went on. One person that used to run a fund thinks there is more than a short squeeze going on based on what he is seeing.

It is definitely affecting brokerages. I think trading volume was something like $20B yesterday. A few other stocks are joining the "party" like AMC.
https://www.marketwatch.com/story/here- ... 1611687693
Yes I understand the David v Goliath aspect. I’m questioning why long-only investors should have any exposure to this sort of side betting action. Why should short selling be allowed at all, even by Goliath? Let them make their negative bets in a wall-off part of the game board, like making side bets on a crap table.
Pegasus_RPG
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Re: GameStop GME: anyone joining?

Post by Pegasus_RPG »

CrossOverGuy wrote: Wed Jan 27, 2021 4:03 pm Question: With all this momentum with short selling and people trying to pump and dump, this stock, AMC, and some others, etc., same it seems with things like bitcoin, does it affect very much index funds on the whole?
I've been wondering this too. So Let's have a look:
As of 12/31/20, VTSAX held 1,468,071 shares for a market value of $27,658,458, or $18.84 per share. Assuming they didn't buy or sell any since then, that position is now worth $510,169,353 at today's close. So the question is: how often do they adjust their holdings to keep pace with market movements? The prospectus (page 23) just says they do it on a "regular schedule" and can do it ad-hoc as they see fit. Even so, the difference between the two values divided by the total fund assets (also as of Dec 31. 2020) works out to 0.18% so nothing to write home about, but you can feel good that you got a small piece of the action.
BlueMoonXD
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Re: GameStop GME: anyone joining?

Post by BlueMoonXD »

alfaspider wrote: Wed Jan 27, 2021 2:33 pm
bugleheadd wrote: Wed Jan 27, 2021 2:25 pm so after the GME squeeze is over, GME is guaranteed to drop big, like 90%?
I think just about everyone realizes that. The debate is over who is left holding the bag when the longs liquidate. The longs think the shorts will once they need to cover. The shorts think they will once the longs waiver and then start to panic. It's a game of chicken.

I personally think the longs are going to panic before they truly see the gains, but we shall see.
Even if the longs are right, some of them will be left holding the bag regardless. If you follow that logic, the price zenith will be when the shorts are forced to cover, resulting in a final upward movement before a total collapse as everyone sells.

But as with all market timing, most folks will fail to identify the top, or even continue buying as the price falls. A lot of the people who are reporting large "gains" will fail to realize them in time and end up underwater. I also think there is a lot of speculation based on the short interest data, but we don't know who holds those positions, in what amounts, and whether they have already begun to close them. For all we know today was the high even if it takes a while for the bottom to fall out entirely.

Obviously the folks who bought in at the bottom are likely to come out OK as long as they sell at some point. But the nature of all pump and dump schemes is that only a fraction of the pumpers will actually be able to return a profit.
qwerty123
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Re: GameStop GME: anyone joining?

Post by qwerty123 »

HomerJ wrote: Wed Jan 27, 2021 4:56 pm
CrossOverGuy wrote: Wed Jan 27, 2021 4:03 pm Question: With all this momentum with short selling and people trying to pump and dump, this stock, AMC, and some others, etc., same it seems with things like bitcoin, does it affect very much index funds on the whole? I realize that the markets are way down today, but it's been so high lately, it's been bound to dip some, but these in the news stocks are only a very small part of these indexes. I had just rebalanced back to my preferred asset allocation into bonds the other day and am trying to ignore the noise for the most part, but would like your feedback. Thanks.
This is a great question.

I knew the housing market was stupid crazy back in 2007-2008, but I figured it wouldn't affect me since I had my house and mortgage.

But of course it did.

I don't really care about bitcoin or GME or any of this other craziness, and I assume I can ignore it and it won't affect me.

But maybe I'm wrong again.
This is my worry as well - I don't know how, but I could see a future where the effects of this + the general bubbly nature of the markets right now boiling over and causing effects on the wider economy and markets.
qwerty123
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Re: GameStop GME: anyone joining?

Post by qwerty123 »

Pegasus_RPG wrote: Wed Jan 27, 2021 5:10 pm
CrossOverGuy wrote: Wed Jan 27, 2021 4:03 pm Question: With all this momentum with short selling and people trying to pump and dump, this stock, AMC, and some others, etc., same it seems with things like bitcoin, does it affect very much index funds on the whole?
I've been wondering this too. So Let's have a look:
As of 12/31/20, VTSAX held 1,468,071 shares for a market value of $27,658,458, or $18.84 per share. Assuming they didn't buy or sell any since then, that position is now worth $510,169,353 at today's close. So the question is: how often do they adjust their holdings to keep pace with market movements? The prospectus (page 23) just says they do it on a "regular schedule" and can do it ad-hoc as they see fit. Even so, the difference between the two values divided by the total fund assets (also as of Dec 31. 2020) works out to 0.18% so nothing to write home about, but you can feel good that you got a small piece of the action.
VTSAX is market cap weighted, so they would only be buying more shares when people are buying more VTSAX. For existing VTSAX, they don't have to buy or sell any shares to keep the correct market cap weight.

One interesting aspect of this - if this were an actively managed fund, they could sell their AMC, GME, etc shares since there's a very low probability these shares will be trading above this price in say, a year.
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Re: GameStop GME: anyone joining?

Post by drk »

qwerty123 wrote: Wed Jan 27, 2021 5:16 pm This is my worry as well - I don't know how, but I could see a future where the effects of this + the general bubbly nature of the markets right now boiling over and causing effects on the wider economy and markets.
I think we saw a preview of the mechanics today. By the looks of it, funds sold off large-cap names in order to cover their short exposure. If there weren't sufficient buyers, the price drop could accelerate, forcing the funds to liquidate other assets. Repeat until the markets seize up like last March.
sheri1983
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Re: GameStop GME: anyone joining?

Post by sheri1983 »

AMC after hours trading volume is 27Mil at the moment! I watched it go from 13 Mil in one hour. GME on the other hand is around 1Mil or a little less. Can anybody explains what this mean?
qwerty123
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Re: GameStop GME: anyone joining?

Post by qwerty123 »

drk wrote: Wed Jan 27, 2021 5:26 pm
qwerty123 wrote: Wed Jan 27, 2021 5:16 pm This is my worry as well - I don't know how, but I could see a future where the effects of this + the general bubbly nature of the markets right now boiling over and causing effects on the wider economy and markets.
I think we saw a preview of the mechanics today. By the looks of it, funds sold off large-cap names in order to cover their short exposure. If there weren't sufficient buyers, the price drop could accelerate, forcing the funds to liquidate other assets. Repeat until the markets seize up like last March.
Is this actually what caused the drop in the market today?
acanthurus
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Re: GameStop GME: anyone joining?

Post by acanthurus »

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SlowMovingInvestor
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Re: GameStop GME: anyone joining?

Post by SlowMovingInvestor »

drk wrote: Wed Jan 27, 2021 5:26 pm
qwerty123 wrote: Wed Jan 27, 2021 5:16 pm This is my worry as well - I don't know how, but I could see a future where the effects of this + the general bubbly nature of the markets right now boiling over and causing effects on the wider economy and markets.
I think we saw a preview of the mechanics today. By the looks of it, funds sold off large-cap names in order to cover their short exposure. If there weren't sufficient buyers, the price drop could accelerate, forcing the funds to liquidate other assets. Repeat until the markets seize up like last March.
I don't see that. The funds released by overall sell off dwarf the amount required to cover short exposure by orders of magnitude, I think. It might be different for specific funds such as Melvin, but not overall.
Last edited by SlowMovingInvestor on Wed Jan 27, 2021 5:37 pm, edited 1 time in total.
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Re: GameStop GME: anyone joining?

Post by rockstar »

sheri1983 wrote: Wed Jan 27, 2021 5:26 pm AMC after hours trading volume is 27Mil at the moment! I watched it go from 13 Mil in one hour. GME on the other hand is around 1Mil or a little less. Can anybody explains what this mean?
It's being pumped on Wall Street Bets on Reddit.
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Re: GameStop GME: anyone joining?

Post by jayk238 »

There are literally people here creating usernames for the first time and posting this nonsense to fluff up their positions and the mods are ok w this????
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Re: GameStop GME: anyone joining?

Post by drk »

qwerty123 wrote: Wed Jan 27, 2021 5:26 pm Is this actually what caused the drop in the market today?
I don't know for sure, but that's my theory. There was also a huge jump in the VIX (pricing in big S&P 500 changes), yet Treasurys and small-cap funds were pretty much flat.
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Re: GameStop GME: anyone joining?

Post by Stinky »

acanthurus wrote: Wed Jan 27, 2021 5:27 pm Cashed out at 324/share after buying in at under 98/share Monday morning, on 10 shares. Is there a thread on which wristwatch should you buy with your GME winnings yet? I'm in the nice Hamilton/used Tudor range I think.
$2,260 gross profit. Maybe $1,700 net?

Not Rolex level, but very nice.
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Re: GameStop GME: anyone joining?

Post by Hector »

I am tempted to go in reverse direction.
Tremendous risk in shorting. You need to figure out time for put option. And who knows for how long will this uptick will last for. I wonder if there is something similar to multiple X Bear for individual stocks
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Re: GameStop GME: anyone joining?

Post by SlowMovingInvestor »

drk wrote: Wed Jan 27, 2021 5:44 pm
qwerty123 wrote: Wed Jan 27, 2021 5:26 pm Is this actually what caused the drop in the market today?
I don't know for sure, but that's my theory. There was also a huge jump in the VIX (pricing in big S&P 500 changes), yet Treasurys and small-cap funds were pretty much flat.
VB (Vanguard Small Cap ETF) -2.32%
VBR (Vanguard Small Cap Value ETF) - 2%

Interestingly, IJS (ishares Small Cap Value) is only -0.1%. It's diverged a fair amount from VBR in the last few days. It has a slightly larger (still very small, but slightly larger) holding of GME, which might be a factor.
Portfolio: 50% DOGE, 10% SPACs, 10% Frozen OJ futures, 10% MOON ETF, 10% NFTs , 5% FOMO ETF, 5% New Jersey Delis with $100M market cap :)
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Re: GameStop GME: anyone joining?

Post by drk »

SlowMovingInvestor wrote: Wed Jan 27, 2021 5:36 pm I don't see that. The funds released by overall sell off dwarf the amount required to cover short exposure by orders of magnitude, I think. It might be different for specific funds such as Melvin, but not overall.
But there's also the domino aspect. If the shorts themselves are forced to liquidate, that impacts derivatives on the stuff they sell, which forces others to adjust their exposure, and so on.
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Re: GameStop GME: anyone joining?

Post by acanthurus »

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