Author Topic: Gamestop: Reddit vs. Wall St.  (Read 10234 times)

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Offline Marco

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Re: Gamestop: Reddit vs. Wall St.
« Reply #50 on: February 01, 2021, 03:51:19 pm »
I still really don't grok the excuses being given by WeBull and others.
Their market makers are massively exposed to their own short positions and the counterparty risk of short positions. Their income comes from routing trades to those market makers, the market makers are their customers and the traders/trades are the commodity being sold.

Customer is king.
 

Offline bdunham7

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Re: Gamestop: Reddit vs. Wall St.
« Reply #51 on: February 01, 2021, 04:02:10 pm »
Customer is king.

And in case anyone didn't get the point, you as a retail trader or pension fund holder are not the customer that is king.  You are meat on the platter.
A 3.5 digit 4.5 digit 5 digit 5.5 digit 6.5 digit 7.5 digit DMM is good enough for most people.
 
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Offline Marco

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Re: Gamestop: Reddit vs. Wall St.
« Reply #52 on: February 01, 2021, 04:13:53 pm »
I can't imagine any reasonably sized pension fund uses a standard brokers any more ... they pay their traders good enough money to know how to use direct market access and the best way to firewall your trading information is to just not do it with a broker with its own trading desk.
 

Offline Syntax Error

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Re: Gamestop: Reddit vs. Wall St.
« Reply #53 on: February 01, 2021, 05:28:46 pm »
Enter the barbarian hoard. Is Reddit is an investment broker or a stage for marionettes who cannot see where their strings are being pulled from? I'm sure the laws of group dynamics make for solid investment fundimentals.

Last week Gamestop. This week Silver. Next week... Tether crypto(?)

Quote
Reddit traders send silver price to eight-year highs: Precious metal soars 12% as renegade investors pile in to put squeeze on short-sellers

https://www.thisismoney.co.uk/money/investing/article-9209527/Silver-prices-jump-eight-year-highs-Reddit-traders-pile-in.html

For private investors who are burning their own money, be aware of the "dead cat bounce" that can make investments seem a no-brainer. Dead cat what?
https://www.investopedia.com/terms/d/deadcatbounce.asp
« Last Edit: February 01, 2021, 05:33:31 pm by Syntax Error »
 

Offline Bud

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Re: Gamestop: Reddit vs. Wall St.
« Reply #54 on: February 01, 2021, 06:29:04 pm »
And you conveniently did not reference this, from the same source:

Quote
However, some other users are arguing that the #silversqueeze is a 'hedge-fund coordinated attack' to distract them from the Gamestop fight
Facebook-free life and Rigol-free shack.
 

Offline Marco

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Re: Gamestop: Reddit vs. Wall St.
« Reply #55 on: February 01, 2021, 07:59:59 pm »
I wouldn't be surprised, even if there's a silver short position it's not like it's due all at once.

Stock shorting gets expensive very quickly when the price moves against the shorters, future contracts spread across months and quarters not so much.
 

Offline thm_w

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Re: Gamestop: Reddit vs. Wall St.
« Reply #56 on: February 01, 2021, 10:40:23 pm »
Enter the barbarian hoard. Is Reddit is an investment broker or a stage for marionettes who cannot see where their strings are being pulled from? I'm sure the laws of group dynamics make for solid investment fundimentals.

Last week Gamestop. This week Silver. Next week... Tether crypto(?)

Quote
Reddit traders send silver price to eight-year highs: Precious metal soars 12% as renegade investors pile in to put squeeze on short-sellers

https://www.thisismoney.co.uk/money/investing/article-9209527/Silver-prices-jump-eight-year-highs-Reddit-traders-pile-in.html

The only "true" goal right now is to hold GME until shorts cover. Anything else could be the work of greed, bots, etc. as Bud says.
The article is a bit of a hyperbole, PSLV is the same price it was august of last year, so prices aren't that crazy. Although maybe physical silver is different?
« Last Edit: February 01, 2021, 10:42:19 pm by thm_w »
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Offline DrGTopic starter

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Re: Gamestop: Reddit vs. Wall St.
« Reply #57 on: February 01, 2021, 10:55:28 pm »
Efficient market indeed.

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Offline tszaboo

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Re: Gamestop: Reddit vs. Wall St.
« Reply #58 on: February 02, 2021, 12:09:26 am »
So when I was researching how the stock market is working:
buy, sell: Ok makes sense
options, call, put: Ok, you can get some insurance for your investment, ok, makes sense
Short: Ok, so you think the price is going down, and if it is going up, you might loose infinite amount of money
TDT: That's sounds like gambling to me.
High frequency trading: OK, so I basically have no chance of ever making money without spending significant amount of time researching everything, because my enemy is a supercomputer, who plays dirty.

And then I looked into the details. Insider trading being illegal. Naked shorting being a common practice. Pump and pump. Tesla. Dutch black tulips.

None of this makes any sense, and I am very sure, most the things that go on on the stock market should be illegal.
 

Offline Syntax Error

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Re: Gamestop: Reddit vs. Wall St.
« Reply #59 on: February 02, 2021, 01:14:54 am »
@NANDBlog This herd hysteria based on some collective guesstimating of the future, makes as much sense as short selling Bitcoin. News just in. Five ways to short Bitcoin: https://www.investopedia.com/news/short-bitcoin/

You can even short a circuit, provided you p*** enough electrolyte all over it.
 
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Offline vad

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Re: Gamestop: Reddit vs. Wall St.
« Reply #60 on: February 02, 2021, 02:29:20 am »
Someone, who stocked up shares before starting hysteria on Reddit, made good (1000%+) profit. Good on them. Idiots, who bought at higher than 10-15 per share and continue holding will loose. This company is going belly up anyway, not because of some evil investors shorting their stock, but because the company is loosing money and has no future. As for the Wall Street, at worst they will write off losses. 16B - today’s market cap of GME - maximum they can loose today - is peanuts for them.
« Last Edit: February 02, 2021, 03:10:41 am by vad »
 
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Offline station240

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Re: Gamestop: Reddit vs. Wall St.
« Reply #61 on: February 02, 2021, 07:59:44 am »
The problem is deeper than just a lot of short selling.

On the Securities and Exchange Commission website, is a list of all shares that have "fails-to-deliver" at settlement date.
So shares that someone has paid for, but couldn't be found.
https://www.sec.gov/data/foiadocsfailsdatahtm
Get the latest one, "January 2021, first half" cnsfails202101a.zip
1163710-0
5,074,937
For a company with only 69.75M shares, having 5M shares (7.16%) that cannot be found is odd.

Also you have this analysis
https://www.reddit.com/r/wallstreetbets/comments/l9rk78/sec_doj_60_minutes_public_data_suggests_massive/
Quote
There are are 71 million shares of GME that have ever been issued by the company. Institutions have reported to the SEC via 13F filings that they own more than 102,000,000 shares (including the 13% of GME stock is owned by Ryan Cohen). That is already 30,000,000 shares more than even exist.

On top of the shares reportedly owned by institutions, retail investors may currently hold 50+ million shares (counting both long holdings and call options – both ITM and OTM).

Once you include call options, retail investors may already hold more than 100% of GME (not just 100% of the float, more than 100% of the actual company). This would be definitive proof of illegal activity at the highest levels of the financial system.

So how can this happen, more shares being held than exist ?
Simple, one or more hedge funds created counterfeit stock in GME, so it could be shorted.
Given the original plan was to bankrupt Gamestop, no one would find out when the shares became worthless.

-------------------------

As for what started all this, a number of people decided Gamestop had a future, especially more recently.
1. PS5 and Xbox Series X|S consoles are selling out, when supply is no longer such an issue, Gamestop can make ever more money.
2. With new consoles, people will want to buy games and accessories to go with it, either instore or online.
3. Has a new CEO Ryan Cohen, and two other new board members.
4. Plans in motion to revamp the company online sales.
5. In the process of exiting out of some of the expensive realestate they lease.

Most recent figures I could find, it's a mixed bag
https://www.gamespot.com/articles/gamestops-holiday-sales-drop-due-to-covid-19-and-ps5-xbox-series-x-sellouts/1100-6486095/ (dated Jan 13 2021)
Quote
Total comparable store sales rose by 4.8% compared to last year
Net sales amounted to $1.77 billion, which is down 3.1 percent.
E-commerce sales jumped by 309% and made up 34% of GameStop's total sales.
GameStop said its sales across Australia and New Zealand jumped by 31 percent, and these regions outperformed GameStop's other international markets.
 
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Offline DrGTopic starter

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Re: Gamestop: Reddit vs. Wall St.
« Reply #62 on: February 02, 2021, 04:12:47 pm »
The problem is deeper than just a lot of short selling.----

I appreciate the post. Not saying I agree, especially about the "fundamentals" of GameStop, but you are presenting some interesting material.

On the call options in one of the quotes- back in the day, I would sell call options (these are contracts, that expire on a certain date, to buy a stock at a certain price). But, I never sold uncovered calls. That is, I could only sell call options where I held the stock. To sell uncovered calls required you to fulfill a bunch of requirements with the brokerage...I never went there (no real reason for me to mention that, but again...memories).

From this morning https://finance.yahoo.com/news/gamestop-extends-pullback-short-interest-083934905.html



and the price


My point, if I have one, is that the short selling was, indeed, at the heart of the move...or not :)

PS: Can't wait to watch Katie Porter (House) and Elizabeth Warren (Senate) start questioning the SEC folks.
« Last Edit: February 02, 2021, 04:15:49 pm by DrG »
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Offline thm_w

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Re: Gamestop: Reddit vs. Wall St.
« Reply #63 on: February 02, 2021, 10:03:25 pm »
Someone, who stocked up shares before starting hysteria on Reddit, made good (1000%+) profit. Good on them. Idiots, who bought at higher than 10-15 per share and continue holding will loose. This company is going belly up anyway, not because of some evil investors shorting their stock, but because the company is loosing money and has no future. As for the Wall Street, at worst they will write off losses. 16B - today’s market cap of GME - maximum they can loose today - is peanuts for them.

- "lose" for reference
- they have 2.8B in assets: https://www.macrotrends.net/stocks/charts/GME/gamestop/total-assets which would equal a value of $40/share
- everyone knows the company has no long term future, but it can easily survive until the end of the current console generation (5-10 years)
- they can't just "write off" borrowed shares, they have to purchase them back first
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Offline vad

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Re: Gamestop: Reddit vs. Wall St.
« Reply #64 on: February 03, 2021, 01:53:54 am »
Someone, who stocked up shares before starting hysteria on Reddit, made good (1000%+) profit. Good on them. Idiots, who bought at higher than 10-15 per share and continue holding will loose. This company is going belly up anyway, not because of some evil investors shorting their stock, but because the company is loosing money and has no future. As for the Wall Street, at worst they will write off losses. 16B - today’s market cap of GME - maximum they can loose today - is peanuts for them.

- "lose" for reference
- they have 2.8B in assets: https://www.macrotrends.net/stocks/charts/GME/gamestop/total-assets which would equal a value of $40/share
- everyone knows the company has no long term future, but it can easily survive until the end of the current console generation (5-10 years)
- they can't just "write off" borrowed shares, they have to purchase them back first
Of those 2.8B, 1.06B is property and real estate after depreciation (land is only 18M, BTW), and 860M is inventory. Cash and AR is only 640M. At the same time they posted -794.8M net income in 2019, -464.4M in 2020. Retailer with such fundamentals is doomed.

Large market players will write off the losses, not the shares. Idiots who yesterday bought at $225, face today’s -60% correction and will never see their money back again.
 
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Offline DrGTopic starter

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Re: Gamestop: Reddit vs. Wall St.
« Reply #65 on: March 12, 2021, 07:29:19 pm »
Around now, I figured I would post a graph of the price and use an old video of the BS&T song, "Spinning Wheel" (What goes up, must go down....).

Instead I post a price graph that seems to defy gravity.



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Offline TerraHertz

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Re: Gamestop: Reddit vs. Wall St.
« Reply #66 on: March 16, 2021, 02:28:26 am »
So when I was researching how the stock market is working:
buy, sell: Ok makes sense
options, call, put: Ok, you can get some insurance for your investment, ok, makes sense
Short: Ok, so you think the price is going down, and if it is going up, you might loose infinite amount of money
TDT: That's sounds like gambling to me.
High frequency trading: OK, so I basically have no chance of ever making money without spending significant amount of time researching everything, because my enemy is a supercomputer, who plays dirty.

And then I looked into the details. Insider trading being illegal. Naked shorting being a common practice. Pump and pump. Tesla. Dutch black tulips.

None of this makes any sense, and I am very sure, most the things that go on on the stock market should be illegal.

Yeah, I long ago decided the stock market is too corrupt and convoluted  to risk my own money in.
And by the way, you left out Front Running - fiddling with communication links to get a few mSec lead on trading notifications, to feed your HFT computers for extra gain.

Personally I prefer investments you can hold in your hand. Nice and simple, nothing the government can do make it go poof. All the better if part of a world-wide movement that might actually bring down the whole rotten house of cards.  http://everist.org/archives/links/__Silver_squeeze_info.txt

A small example:

« Last Edit: March 16, 2021, 02:30:55 am by TerraHertz »
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Offline GodIsRealUnless DefinedInt

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Re: Gamestop: Reddit vs. Wall St.
« Reply #67 on: March 16, 2021, 04:11:52 am »
So about a year or more ago, after many years of steady decline, GameStop was not doing well and their stock was super low. Then, they hired some new board members and the stock went up. Institutional investors (aka hedge funds) observing the phenomenon decided to "short" GameStop stocks to make a lot of money when it failed. The idea of buying GameStop stock and selling it a few hours later at a fraction of the price you bought it for is the most GameStop turnabout imaginable, if you ever tried selling anything back to them =) I always said its good to be the ruling class (government representatives) but then the financial markets have their own ruling class and all the Reddit David's decided to throw stones.
 


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