Pump it F.Rock
- Joined
- 19 October 2005
- Posts
- 4,133
- Reactions
- 6,077
How many of those sophisticated activist traders on Redditt ramping it for the cause of sticking it to the establishment are in good faith and not stashing away profits instead of 'holding the line' and going all in like they're encouraging others to do? Reminded me of a doco I saw about Tiananmen Square where a female organizer knew the army was coming in to smash heads but kept orchestrating from the sanctuary she was in. It was something like that, bit blurry about the details, but the cynicism and treating demonstrators as expendable pawns for a greater purpose (her ambition) was striking.
I know Michael Burry (of big short fame) was on the trade and made 1500% or something.
There's a big mix of personalities here. I suppose its a question of: "is greed still relevant in 2021"?
Or perhaps "how long till the greed hits".
Either way its an opportunity for me to cash in on. These don't come around often.
Dona Ferentes
A little bit OC⚡DC
- Joined
- 11 January 2016
- Posts
- 15,095
- Reactions
- 20,478
“What's sauce for the goose is sauce for the gander.”
- Joined
- 19 October 2005
- Posts
- 4,133
- Reactions
- 6,077
GameStop's dizzying share price rise is game over for the short-sellers
The retailer has gone from $19 to $330 thanks in part to amateurs taking on the hedge funds
Thu 28 Jan 2021
If you find trading bitcoin insufficiently hair-raising, try GameStop. It is the Texas-based video games retailer that will be hard to out-do as the stock market story of 2021. The share price was $19 at the start of this month but reached $330 in mid-afternoon on Wednesday in New York. There have been a few downwards lurches along the way, but the overall direction has been unsustainably upwards.
It must be unsustainable because nothing of note has happened to improve GameStop’s commercial prospects so radically. Exciting PlayStation and Xbox releases may lie around the corner, but the company is still a bricks-and-mortar retailer struggling in an online age. Instead, punting on GameStop has become a video game in itself.
One could call the game “burn the bears” – the bears being short-selling hedge funds who had bet last year that the share price had further to fall. They reckoned without a Reddit forum called r/WallStreetBets, where amateur traders gather, in this case to spot a daring counterattack – an uprising to propel the share price higher.
You have to admire the imagination. Short-sellers had bet so heavily on catastrophe for GameStop that they were vulnerable to any sudden reversal. In the old days, private punters would not have been able to assemble enough collective financial firepower to make a difference. Now, like the professionals, they have access to financial leverage in form of zero-commission derivatives – futures and options – to throw a few sticks of dynamite into the mix.
The explosion forced the hedge funds to cover their losses by buying stock, thereby adding to the upward momentum. The phenomenon is not new, but it’s hard to think of another example on this scale. Two hedge funds, at least, have been severely scalded, which, according to the subreddit, was half the point of the exercise. It was about getting one over on Wall Street.
In that sense, it has succeeded to a degree that seemed impossible. And, since short-sellers are rarely popular, the world will not weep for the hedge fund losers. Instead, one reaction was to wonder where Reddit’s enterprising crew will strike next. BlackBerry, another heavily shorted stock, has seen similar dynamics. Even the 14% rise on Wednesday in Pearson, a member of the FTSE 100 index, was attributed to short-sellers running for the hills.
Where does the tale go next? Well, despite calls for regulators to investigate possible market manipulation, that plot-line looks a non-starter. Amateurs communicating in chatrooms to talk up a stock does not amount to a conspiracy; the practice is as old as the internet.
Instead, after a few more rounds of excitement, expect the game to stop in the traditional way: the late-comers to the party, and those staying until the end, will learn the hard way that a paper profit is not the same as cash.
The smart money will be out by then, of course. But if GameStock’s common sense value is $2bn-ish – and not the $24.5bn implied by the share price on Wednesday – the crash will be brutal.
A GameStop retail store is open for business in New York City on Wednesday
The retailer has gone from $19 to $330 thanks in part to amateurs taking on the hedge funds
Thu 28 Jan 2021
If you find trading bitcoin insufficiently hair-raising, try GameStop. It is the Texas-based video games retailer that will be hard to out-do as the stock market story of 2021. The share price was $19 at the start of this month but reached $330 in mid-afternoon on Wednesday in New York. There have been a few downwards lurches along the way, but the overall direction has been unsustainably upwards.
It must be unsustainable because nothing of note has happened to improve GameStop’s commercial prospects so radically. Exciting PlayStation and Xbox releases may lie around the corner, but the company is still a bricks-and-mortar retailer struggling in an online age. Instead, punting on GameStop has become a video game in itself.
One could call the game “burn the bears” – the bears being short-selling hedge funds who had bet last year that the share price had further to fall. They reckoned without a Reddit forum called r/WallStreetBets, where amateur traders gather, in this case to spot a daring counterattack – an uprising to propel the share price higher.
You have to admire the imagination. Short-sellers had bet so heavily on catastrophe for GameStop that they were vulnerable to any sudden reversal. In the old days, private punters would not have been able to assemble enough collective financial firepower to make a difference. Now, like the professionals, they have access to financial leverage in form of zero-commission derivatives – futures and options – to throw a few sticks of dynamite into the mix.
The explosion forced the hedge funds to cover their losses by buying stock, thereby adding to the upward momentum. The phenomenon is not new, but it’s hard to think of another example on this scale. Two hedge funds, at least, have been severely scalded, which, according to the subreddit, was half the point of the exercise. It was about getting one over on Wall Street.
In that sense, it has succeeded to a degree that seemed impossible. And, since short-sellers are rarely popular, the world will not weep for the hedge fund losers. Instead, one reaction was to wonder where Reddit’s enterprising crew will strike next. BlackBerry, another heavily shorted stock, has seen similar dynamics. Even the 14% rise on Wednesday in Pearson, a member of the FTSE 100 index, was attributed to short-sellers running for the hills.
Where does the tale go next? Well, despite calls for regulators to investigate possible market manipulation, that plot-line looks a non-starter. Amateurs communicating in chatrooms to talk up a stock does not amount to a conspiracy; the practice is as old as the internet.
Instead, after a few more rounds of excitement, expect the game to stop in the traditional way: the late-comers to the party, and those staying until the end, will learn the hard way that a paper profit is not the same as cash.
The smart money will be out by then, of course. But if GameStock’s common sense value is $2bn-ish – and not the $24.5bn implied by the share price on Wednesday – the crash will be brutal.
A GameStop retail store is open for business in New York City on Wednesday
- Joined
- 3 May 2019
- Posts
- 6,185
- Reactions
- 9,678
Not me.
ABC news just had a large chunk of their finance segment on the GameStop phenomenon.
They actually referenced GME in Australia as having the same name and also attracting attention !
Will be funny if it grows more legs based off same ticker association.
A proper laugh!
Reminds me of Z1P and ZIP.
ZIP turned into DOU (a neobank) and ended up being a ~10 bagger for holders.
Monkey hears, monkey types.
- Joined
- 28 August 2010
- Posts
- 1,154
- Reactions
- 1,720
SINGAPORE, Jan 28 (Reuters) - Shares in small Australian nickel and cobalt explorer GME Resources (GME) jumped as much as 53% on Thursday, apparently driven by the similarity of the company's stock ticker to U.S. retail investor darling GameStop GME.N .
GME Resources stock rose as much as four Australian cents to A$0.115 ($0.0878) in early trade, before falling back to close just below nine cents for a 15% gain. It rose 14% on Wednesday.
"There are people buying the stock for shits and giggles, just because of the ticker symbol," said market analyst Kyle Rodda of brokerage IG Markets in Melbourne.
GME Resources stock rose as much as four Australian cents to A$0.115 ($0.0878) in early trade, before falling back to close just below nine cents for a 15% gain. It rose 14% on Wednesday.
"There are people buying the stock for shits and giggles, just because of the ticker symbol," said market analyst Kyle Rodda of brokerage IG Markets in Melbourne.
- Joined
- 13 September 2013
- Posts
- 988
- Reactions
- 530
i did that yesterday as a 'just in case' lol
- Joined
- 30 June 2008
- Posts
- 15,357
- Reactions
- 7,232
This "slaughter of the shorters" has captured the imagination of the little guy investors.
Good explanation in The Guardian on what has happened.
In my mind it bears an uncanny resemblance to the revenge of the duped stock traders in "Trading Places".
The money shot of the money was watching the Dan Ackroyd and Eddie Murphy destroying the Duke brothers with a massive short play on the floor of the Commodities exchange.
Good explanation in The Guardian on what has happened.
In my mind it bears an uncanny resemblance to the revenge of the duped stock traders in "Trading Places".
The money shot of the money was watching the Dan Ackroyd and Eddie Murphy destroying the Duke brothers with a massive short play on the floor of the Commodities exchange.
- Joined
- 30 June 2008
- Posts
- 15,357
- Reactions
- 7,232
About Gamestop.
Liked these quotes..
www.theguardian.com
Liked these quotes..
What is GameStop, where do the memes come in, and who is winning or losing?
The stock market has gone crazy for an ailing games retail company. Or rather it was always crazy, and GameStop has exposed it
Country Lad
Off into the sunset
- Joined
- 11 July 2005
- Posts
- 1,555
- Reactions
- 1,491
It is interesting that everything I see in the media and from financial commentators seems to be not understanding it or having a bit of a joke about this. Very little mention where to from here.
The company is a bricks and mortar games shop, comparatively small in the scheme of things. It was accepted in the market that it was unlikely to survive let alone grow and now it sits with an unrealistic valuation.
As @finicky said earlier,
The smart money will be out by then, of course. But if GameStock’s common sense value is $2bn-ish – and not the $24.5bn implied by the share price on Wednesday – the crash will be brutal.
Well, Just maybe, those shorter funds are licking their lips thinking this has to crash, so if we start selling short now, we can create panic and make a bigger killing and more than cover the losses we had on the way up.
Who may just be caught holding the bag? Maybe those reddits who started it and enjoying it so much they don't sell quick enough. Or simply all those FOMO traders not really understanding what has happened.
The company is a bricks and mortar games shop, comparatively small in the scheme of things. It was accepted in the market that it was unlikely to survive let alone grow and now it sits with an unrealistic valuation.
As @finicky said earlier,
The smart money will be out by then, of course. But if GameStock’s common sense value is $2bn-ish – and not the $24.5bn implied by the share price on Wednesday – the crash will be brutal.
Well, Just maybe, those shorter funds are licking their lips thinking this has to crash, so if we start selling short now, we can create panic and make a bigger killing and more than cover the losses we had on the way up.
Who may just be caught holding the bag? Maybe those reddits who started it and enjoying it so much they don't sell quick enough. Or simply all those FOMO traders not really understanding what has happened.
How high though?
It has to come down, but this crowd isn't the usual investment mob. If shorters pile in what's stopping more of the mob jumping on to try and squeeze them?
Who runs out of money first?
I think they had a couple hundred thousand join in on the action the last few days. But given the attention span of the internet users it will probably blow up next week.
But there's a few stocks that are getting jumped on. Best to profit while it's in play.
- Joined
- 2 April 2020
- Posts
- 119
- Reactions
- 182
- Joined
- 12 January 2008
- Posts
- 7,169
- Reactions
- 17,744
We're not allowed to give specific financial advice at any time.
People are going to lose a LOT of money when the buying stops in these highly publicised US companies.
People are going to lose a LOT of money when the buying stops in these highly publicised US companies.
Ok no worries. Wasn’t asking for any specific advice to rely on.
Yes I agree with you although hopefully not too many are putting their life savings in. I have what I like to call “flash” money set aside for such occasions so thinking I might throw some of that in. Or maybe I might even short GameStop myself (if I can figure out how). I’ve never short sold anything before.
- Joined
- 8 June 2008
- Posts
- 12,426
- Reactions
- 18,090
If you buy one of these stocks, and are lucky it goes up.we all agree you will have to sell one day, when? With the volatility they exhibit, there is a fair chance that the stop loss etc will be vaporised, then will you be awake to pull the plug, will your broker be able to handle the traffic,the requests.this will not be OTC but via the internet platform..so much risk
I figure set an arbitrary mark to sell. Eg GME @USD1000. BB @USD125.
No stop loss.
Trades online through CommSec International.
Similar threads
