Crushing the Hedge Fund shorts

Sorbate said:
Pretty much manipulating the system to win, then gets it done to him and cries, boo, hoo.
What a baby.
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The only issue is that at the end of the day not only the hedge fund loses, but so will many of these investors. I expect that there are some actors on the sidelines who are in the middle of the trade. They jumped in, will make like a bandit, and then leave. Those who have been buying the stock at it's current price may not realize that as the positions are unwound there may not be anyone there to buy their shares. The stock certainly isn't worth $325.

One guy in particular started accumulating shares a year or so ago using options, and over time others started to notice and jumped on. The last statement I saw online his unrealized profit was 33M (Thurs), down from 47M on Wed. I don't know what his initial investment was, but a statement from a year ago was around 100k, so this has been a gradual climb. Once the short-squeeze occurs these shares could jump much higher, at which time I expect to see the entire thing begin to unwind, which will be messy. I don't know how much of any short positions remain.

I'm quite certain that some of of those jumping into this thing don't realize that they could lose their investment.
 
Simple analogy as to what happened with RobinHood.

Imagine you are a gambler enjoying a night at the casino. You decide to play Blackjack. Your hand is a ten and the dealer shows a 7.

"I would like to hit."

"No sir. You are only allowed to stand or surrender."

"That's not the rules of the game. Aren't you regulated?"

"Due to the volatility your hand represents to the Casino, sir, you are only allowed to stand or surrender. These are extraordinary times."

"...are you only allowed to stand or surrender?"

"No sir. In fact, we may double down."

"Wait. What? You are the dealer, you can't put more money in that I didn't put in. That money doesn't even exist on the table!"

"Sir, you have a gambling problem. We might have to report the commission on you for attempting to hit with your hand because your friend told you that you should."

"Wait, are you trying to make me fold?"

"Sir, we reported you to the newspaper for being a degenerate."

"You guys are crazy!"

"Sir, we have decided that in order to protect your interests, you have decided to surrender."


More detailed description here.
Best writeup I've seen so far.
https://threadreaderapp.com/thread/1355274739351248898.html
 
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Heraclitus said:
Simple analogy as to what happened with RobinHood.

Imagine you are a gambler enjoying a night at the casino. You decide to play Blackjack. Your hand is a ten and the dealer shows a 7.

"I would like to hit."

"No sir. You are only allowed to stand or surrender."

"That's not the rules of the game. Aren't you regulated?"

"Due to the volatility your hand represents to the Casino, sir, you are only allowed to stand or surrender. These are extraordinary times."

"...are you only allowed to stand or surrender?"

"No sir. In fact, we may double down."

"Wait. What? You are the dealer, you can't put more money in that I didn't put in. That money doesn't even exist on the table!"

"Sir, you have a gambling problem. We might have to report the commission on you for attempting to hit with your hand because your friend told you that you should."

"Wait, are you trying to make me fold?"

"Sir, we reported you to the newspaper for being a degenerate."

"You guys are crazy!"

"Sir, we have decided that in order to protect your interests, you have decided to surrender."


More detailed description here.
Best writeup I've seen so far.
https://threadreaderapp.com/thread/1355274739351248898.html
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i might be wrong but that not quite a unbiased explanation. the player here is colluding with other players, is not redditors intending to pump up a stock illegal? when its all over, hedge funds gone broke, early investors cashed out and rich, wont the late investors into this scheme be left holding stocks that they over paid? fuck robinhood, thats unfair but exchanges halting trades is a normal practice to cool thing down.

imo, options would be banned in a fair world. they fuck up the fundamentals of a stocks true value.
 
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zenmonky said:
i might be wrong but that not quite a unbiased explanation. the player here is colluding with other players, is not redditors intending to pump up a stock illegal? when its all over, hedge funds gone broke, early investors cashed out and rich, wont the late investors into this scheme be left holding stocks that they over paid? fuck robinhood, thats unfair but exchanges halting trades is a normal practice to cool thing down.

imo, options would be banned in a fair world. they fuck up the fundamentals of a stocks true value.
Click to expand...
The writeup or the analogy?
The link goes into the order flow issues, the analogy was meant to be humorous but describes how RobinHood treated their traders on behalf of the house. (Citadel).

If they had halted trading that would be one thing. There are even circuit breakers built in for that.
But they didn't halt trading, they halted retail from buying but allowed them to sell, essentially guaranteeing that with no demand the stock price would go down. And.... they also allowed the institutional buyers to continue buying to cover their naked short. (Citadel holds interest in that naked short too)

Melvins goal here was to crush CME into bankruptcy and never have to buy back any stock at all.
They overplayed their hand and got burned. (or would have in an honest game, still might)
Similar thing happened with Volkswagon and Porsche and no one whined about it then. This is only news because it was the little guys who were doing it this time. Well this.. and also the fact that many are buying as protest in solidarity, fully expecting to hold to the end.

options and shorts are necessary for market stability and liquidity, like buying insurance.
but double lending of stock that doesn't exist IS illegal, and not hedging your upside risk, is just plain stupid.

2minute video
 
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Where do I find this group for Wallstreet, just reddit? Looks like they just pumped ripple
 
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