Lurker > red sox 777

Sunroof posted...

What would happen if I pick a very low strike price with a very long expiration date, essentially guaranteeing itd get hit?

Then it gets closer and closer to just owning the shares. A share is basically a call with a strike of zero that never expires. But buying any option will always be riskier than owning shares.

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September 1, 2003; November 4, 2007; September 2, 2013
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Yes, I would strongly suggest you do NOT play with these until you have understood them better. They are literally the single easiest way to destroy wealth.

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September 1, 2003; November 4, 2007; September 2, 2013
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Sunroof posted...

Lmao. Okay, well what if its about $14?

At exactly $14 your calls are worth zero. For each dollar above that it goes, they increase in value by $9,000.

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September 1, 2003; November 4, 2007; September 2, 2013
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Sunroof posted...

Here is a scenario I just drafted. If I hit submit, what would this mean?

You are paying $108,000 to buy 90 calls at a strike of $14 expiring Friday. Each call gives you the right to buy 100 shares of AMC for a price of $14. That is a total of 9000 shares of AMC. If AMC is below $14 at close on Friday your calls expire worthless, resulting in a loss of 100% of your investment of 108k.

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September 1, 2003; November 4, 2007; September 2, 2013
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So this low volume plunge is taking us pretty close to the point where WSB could just own 100% of Gamestop for $1,000 average per subscriber. That's probably less than the typical WSB person's monthly budget for stupid YOLO bets that fail 90% of the time.

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September 1, 2003; November 4, 2007; September 2, 2013
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That's too bad Blur - I know it hurts. I think the risk management now is okay though - original bet was too big relative to account size. The thing about position sizing is that when the stock goes up, the position size grows by itself. So you would need to sell some to maintain the same position sizing as before.

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September 1, 2003; November 4, 2007; September 2, 2013
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If it's still at $160 at open I'll buy a little more. Not my full line from before though because I like having a big gain on this stock locked in and don't want to give that up too much. I know, it's not that rational.

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September 1, 2003; November 4, 2007; September 2, 2013
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Ah, it must have been ARKQ rather than ARKK. It's on the holdings list as of today.

https://ark-funds.com/wp-content/fundsiteliterature/holdings/ARK_AUTONOMOUS_TECHNOLOGY_&_ROBOTICS_ETF_ARKQ_HOLDINGS.pdf

I think what she does is buy and sell frequently to adjust the weights of the holdings.

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September 1, 2003; November 4, 2007; September 2, 2013
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https://www.nasdaq.com/articles/are-these-the-best-heavily-shorted-stocks-to-buy-right-now-5-names-to-watch-2021-01-31?amp

This is an article from Nasdaq saying short interest in GME as of Friday was 121%. Much higher than the numbers from S3 Partners. This is really weird how these short interest numbers are wildly different from different sources.

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September 1, 2003; November 4, 2007; September 2, 2013
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LordoftheMorons posted...

Do you agree with his super-populist take that long term capital gains taxes should be zero

Combined with a financial transactions tax to make HFT unprofitable? Sure. We would also need to change the tax code to get rid of the devices for converting income into capital gains. For example:

Trump buys a building in New York. He pays $X for it (mostly borrowed, naturally). Now he collects rent. But he doesn't pay taxes on the rent because he offsets it with depreciation charges, which are higher than the rent. In fact, he declares a "loss." And the cost basis is adjusted based on the depreciation. Meanwhile, he can use the loss to avoid paying taxes on other income, and if there is leftover loss, he rolls it over, accumulating year by year an ever bigger hoard of tax losses. Meanwhile, the cost basis keeps getting adjusted.

So where did all the money go? Into the value of the property. So now, if he sells, there would be a large capital gain. Which he would pay a lower rate on. But in fact, even if he sells, under current law, as long as he uses the money to buy another piece of real estate, he can avoid the tax and carry over the cost basis to the new property. And you see how as long as he stays invested in real estate he is NEVER going to pay a dime of tax. And if he finally does cash out, it would be at the long term capital gains tax rate.

So if we go to a long-term capital gains tax of zero, we can't allow this kind of strategy to work.

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September 1, 2003; November 4, 2007; September 2, 2013
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Because space is the next frontier! Even my grandmother is excited about the upcoming space race.

Specifically, today, SPCE announced the window for their next test flight in a couple weeks. I do plan to sell a fair portion of my shares before then because this position has gotten up to close to 40% of my portfolio and the test flight will probably either send it plunging or soaring. I need to get it down to a level before the test flight where it doesn't give me a heart attack lol.

Cathie Wood is also starting a space-themed ETF (ARKX) and SPCE has long been a holding in ARKK.

Finally, I've been reading/watching Chamath stuff a lot recently, and I find myself agreeing with him an awful lot. I think he's got my vote for governor of California as it stands.

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September 1, 2003; November 4, 2007; September 2, 2013
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Thanks for the tip, I will do some research tonight to see if I'm going to buy FRSX tomorrow.

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September 1, 2003; November 4, 2007; September 2, 2013
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Nanis23 posted...

Never trusted Tesla, never will. But sadly if you keep thinking about stocks "the right way" you will never join the best stocks
I called Tesla a bubble ever since it was 400 pre-split. Analysts which are smarter and more experienced than me called it a bubble when it was 200 pre-split. Someone even gave it a price target of $0.
But look where it is now.

Gamestop too. Company is not worth more than $10. Digital or otherwise. as I mentioned, I followed WSB for months. I followed $GME for months. I never believed in it and look what happened.

You see, Lopen might be right about CTRM being a scam
But look at the graph in the last 30 days. More than tripled itself. Scam? maybe. But the market decides, not you.

Nano Dimension (NNDM), A Israeli company that makes 3D printers was the worst stock in our Stock Exchange for YEARS.
Any investor that wanted to trust it erased 99% of his money IN A YEAR each damn year. Reverse splits, heavily discounted IPOs, you name it
Just look at this shitty graph


In the goddamn how many years this shitty company exists, it only sold 2!! 3D printers. That's it.
Then ARKK decides to purchase of few stocks and the market decided "something is going on" and whoop stock is up 1500% in just 3 months
The company also decided it's a great opportunity to make discounted IPOs AND THE MARKET KEEPS GETTING THE STOCK PRICE HIGHER while totally ignoring the IPOs.
I have never seen anything like this

Long story short, market cap is almost $3 billion
https://companiesmarketcap.com/israel/largest-companies-in-israel-by-market-cap/
Making it the #24 highest Israeli company by market cap.
For a company that has a revenue of $500k per quarter and a net loss of $20 MILLION per quarter

Don't listen to logic. Go with the flow

*This whole post is "words are easier than done" as I am also in the "if it doesn't make sense, I am staying out" camp most of the time

Next time you find a company that you think is horrible, please let me know so I can think about buying it.

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September 1, 2003; November 4, 2007; September 2, 2013
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Count me as another person who has never invested in Tesla and probably won't. I'm open to admitting I was wrong about it being a bubble but the price is so high now that I'm not going to buy.

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September 1, 2003; November 4, 2007; September 2, 2013
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ChaosTonyV4 posted...

Is there another Chaos? I didnt mean to imply this if youre referring to me

That wasn't you.

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September 1, 2003; November 4, 2007; September 2, 2013
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He cashed out like 14 million already. He'll be fine.

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September 1, 2003; November 4, 2007; September 2, 2013
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ExThaNemesis posted...

Short Interest
226.42

Hahahahahah

Where are you seeing this?

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September 1, 2003; November 4, 2007; September 2, 2013
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PerfectChaosZ posted...

If you have 450k at all youre more likely to be able to lose money than if you have $150 at all. The person who lost $50 would still be more screwed over than the person who lost $150k because they still have barrels more money to invest again while the other person is eating ramen for the month for daring to try and stonk. Its just a stupid thing to say.

The other side of this is thinking how easy it is to replace the money. Most people will be able to replace $150 eventually by working. It's very hard to save up $450k.

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September 1, 2003; November 4, 2007; September 2, 2013
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Yes! SPCE is now my biggest winner in dollars as of today, above GME. (I put a lot more money into SPCE than GME).

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September 1, 2003; November 4, 2007; September 2, 2013
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The positive thing about GME is the volume continues to crater. Don't think we are even going to hit 35 million today.

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September 1, 2003; November 4, 2007; September 2, 2013
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I have no confidence in this, but if you forced me to guess I would guess there will be a further squeeze, but only up to $1000 or so. Think that the blatant cheating they did with not letting people buy on Thursday probably bought them enough space to cover enough shorts at low prices to avoid the feedback loop.

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September 1, 2003; November 4, 2007; September 2, 2013
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Colegreen_c12 posted...

While I do agree that $1 is a joke, do remember that when it was at $2 there was like 40% of the oustanding shares than there are now. A $1 market price now is actually a higher market cap than when it was $2.

But since that share dilution paid off all their debt $1 is still ridiculous. $5-8 seems fair to me for a conservative estimate

There's that much dilution? Wow! Now I'm feeling pretty bad about this.....

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September 1, 2003; November 4, 2007; September 2, 2013
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Lopen posted...

MKM analyst dropping AMC PT to $1, from $2

LMAO. Has had only good news since it was at $2. Even if you don't believe the current price whatsoever you can't put the target at less than like $5.

This kind of news makes me think there will be further squeezing. $1 PT is a joke. Bankruptcy is basically off the table already.

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September 1, 2003; November 4, 2007; September 2, 2013
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The last time I followed Chris on a stock like this I made $60. On HPR. I sold one day before it fell off the face of the Earth.

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September 1, 2003; November 4, 2007; September 2, 2013
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Yeah covered calls seems like a great fit for his trading style.

Just never ever ever ever ever sell uncovered calls.

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September 1, 2003; November 4, 2007; September 2, 2013
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ExThaNemesis posted...

how the fuck is that even possible w the volume it's showing?

Maybe they exercised a lot of calls. Not sure I entirely trust S3 Partners - they said yesterday short interest hadn't fallen much and then said 6 hours later that it had.

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September 1, 2003; November 4, 2007; September 2, 2013
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SPCE +18% now. Beautiful. GME rallying back too.

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September 1, 2003; November 4, 2007; September 2, 2013
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Story of today for me:

GME is down. Bought AMC at the wrong time. LAZR, VLDR, AI, and F all flipped from green to red.

SPCE says no problem, I will make today a green day all by myself.

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September 1, 2003; November 4, 2007; September 2, 2013
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Bought back a little bit of GME at $255.

SPCE is really shining today.

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September 1, 2003; November 4, 2007; September 2, 2013
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FWIW GME volume is continuing to crater on a daily basis. Looks to be down nearly 40% from Friday's volume.

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September 1, 2003; November 4, 2007; September 2, 2013
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RepealThe19th posted...

Hey can someone active on WSB coordinate an AAL pump in late March when I'm long? That would be swell.

That's illegal.

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September 1, 2003; November 4, 2007; September 2, 2013
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Got in on AMC and CNK. Feels like it's too late on AMC but we'll see.

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September 1, 2003; November 4, 2007; September 2, 2013
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If there is a trading halt and you have straight shares, fully paid for with cash, you should be fine. The shorts are still stuck and they need an active market to cover. If you have options or have bought on margin you could get screwed.

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September 1, 2003; November 4, 2007; September 2, 2013
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https://www.sec.gov/oiea/investor-alerts-and-bulletins/risks-short-term-trading-based-social-media-investor-alert

In other instances, fraudsters start negative rumors urging investors to sell their shares so that the stock price plummets and then the fraudsters take advantage of buying shares at the artificially low price.

Happy the SEC is publicly talking about this.

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September 1, 2003; November 4, 2007; September 2, 2013
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If it were any other stock, a $375 to $300 swing would count as plummeting. With GME, it's less than usual variance.

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September 1, 2003; November 4, 2007; September 2, 2013
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I wonder how much I would have spend on commissions the past year if they still existed. Checking my brokerage data, I made 198 trades....so that would come out to about $1,000 at $5/trade commission. Well, not as bad as I thought.

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September 1, 2003; November 4, 2007; September 2, 2013
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StartTheMachine posted...

The positions would immediately offset? Uhhh is a hedge fund only allowed to use one broker or something?

It's not that hard to do. This thing will come tumbling down eventually and theoretically they could win both ways, regarding GME, if they got in early enough long, made massive gains off of that. When GME stops getting new buyers (but also doesn't squeeze) and people start taking profits and it all collapses at once, they close their short position when they're satisfied. But at this point, it's not about winning anymore for them, it's about not getting absolutely destroyed, and hedging their trades is the best way to do that.

I dunno maybe I need more sleep and these are all dumb conspiracies. This is how I would be thinking if I were a hedge fund though

If they want to cover it's easier to just cover than to be 200% exposed to GME (net 0%). They need more margin set aside for GME to maintain the 200% exposure. Plus they need to pay interest. It just doesn't make sense and they can't make a dime more doing it.

It would make more sense to hedge with deep OTM call options. That one I don't rule out.

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September 1, 2003; November 4, 2007; September 2, 2013
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StartTheMachine posted...

Honestly hedge funds are probably mostly driving both stocks at this point, but I especially am counting on them for pumping the fuck out of AMC.

I hate it to break it to you but that's the reality. It's literally in the title of what they do - hedge funds. These guys can be losing a huge short position but hedging with long positions and as long as they have the funds to pay margin interest rates, they can probably hold off on closing their short position for long enough, since their long position is making money back.

Now that I know how short squeezes actually work, that's my personal theory on why all the blue chip stocks are down - not to pay margin interest, but to buy more GME and AMC because their long position was down.

I could be completely wrong. But if I'm not, just don't let the secret get out and we'll all get rich anyway. Melvin certainly got fucked from billions, I just don't think it's going to be as sweet as sending them to bankruptcy.

It's different funds that would be on the long side. A single fund wouldn't have both long stock and be short. The positions would immediately offset. And even if that kind of position were allowed, it would be dumb, like playing baccarat by putting the same amount of money on both player and banker. Yeah, you won't lose more than 5% of one bet per hand, but you can literally never win no matter what happens. That's a dumb position.

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September 1, 2003; November 4, 2007; September 2, 2013
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CoolCly posted...

I thought it might be a slow start on monday, since it's really only been one or two business days since the robinhood shenanigans, and that seems a bit too fast for users to get new accounts set up and money transferred over. This is a bit surprising - are other institutions driving this or is this still retail investors?

This is Germany and low volume so it wouldn't be Robinhood traders in any case. But yeah, there are very likely a bunch of hedge funds in this now on the long side.

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September 1, 2003; November 4, 2007; September 2, 2013
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$375 for GME in Frankfurt. Good start. I'm hoping it can open above $500 so we can see what the supply/demand is at those price points.

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September 1, 2003; November 4, 2007; September 2, 2013
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I'm still bullish on airlines although not as bullish as before since they already doubled from last Spring. I sold my position in November after the surge on the vaccine news and would consider buying back in on a dip. I am starting to think about investing in cruise lines as well.

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September 1, 2003; November 4, 2007; September 2, 2013
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Sunroof posted...

Are any of these massive hedge funds attached to the funds chosen in 401(k)s? Mine has gone down the past week and Im just now wondering if this is a downside to whats been going on.

Probably not, they are generally for rich people only. The market as a whole was down a lot this past week so that might be what's going on.

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September 1, 2003; November 4, 2007; September 2, 2013
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I've been seeing very high exuberance recently, so to anyone new here: please don't take the last 2-3 weeks as representative of the stock market. Occasionally it can be like this, but most of the time, it is not. I find that it is beneficial to understand the risk profile of an investment before you buy - don't wait until after you buy when you are trying to decide whether to sell. This helps to avoid both panic selling and fear of missing out, both of which tend to make people lose money.

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September 1, 2003; November 4, 2007; September 2, 2013
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So now S3 Partners is saying that the GME short interest declined dramatically on Friday:

https://s3partners.com/Exclusive.html?utm_source=twitter&utm_medium=announcement&utm_campaign=10ds

Not sure they are entirely trustworthy as they tweeted 6 hours before this that short interest had not declined much. This decline in short interest doesn't match up with the tape on Friday IMO but a possibility is that short sellers covered by exercising long call options. Although, it is sort of hard to imagine GME shareholders writing so many covered calls when their thesis is that this stock is going to the moon. Overall, not sure what to make of this.


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StartTheMachine posted...

Hold up, you think GME hasn't been squeezed yet? How do you know? So have they only covered their interest rates but haven't actually bought shares back?

sorry I was rereading the earlier parts of this topic for research purposes

According to the director guy at S3 Partners, the short interest fell from 138% or so down to 113% or so as of close of Thursday. Might be a little bit lower than that now if they covered some on Friday. He says he will have more numbers for Friday tomorrow.

https://twitter.com/ihors3

That's where I am getting my info.

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September 1, 2003; November 4, 2007; September 2, 2013
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I feel better about my Ford stock. Doesn't look like America is going to let these national icons fail.

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https://www.reddit.com/r/wallstreetbets/comments/l9gv98/citadel_is_the_5th_largest_owner_of_slv_its/

Looks like Citadel may have resorted to trying to pump stocks it owns on WSB.

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Yes, but usually person B actually expects the value of the stock to go up. In normal stocks the interest is a nice bonus, but not really enough to justify holding a stock if you think it will fall. In GME though, the interest is sky high so it might be worthwhile for a long term investor just to hold for the interest.

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September 1, 2003; November 4, 2007; September 2, 2013
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Peace___Frog posted...

I expect anything above $400 to be a meme, how many people do you think have limits at $420.69

We were above that on Thursday morning, so any limit orders for that price placed prior to then should already have been filled.

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September 1, 2003; November 4, 2007; September 2, 2013
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A lot of them are saying that they don't really care about making money out of this, which given WSB's history of cheerfully accepting massive losses on outrageously aggressive bets, actually kinda makes sense.

There are definitely going to be people who sell too late and people who sell too early, which is why I am pretty happy with my strategy of selling on a ramp. Some of my shares will be too early, some of my shares may be too late, but since it's really hard to predict, this way lowers risk.

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September 1, 2003; November 4, 2007; September 2, 2013
Congratulations to DP Oblivion in the Guru Contest!