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I don't know- there must be institutional players on the long side by now right? Either way, _eventually_ someone will be left holding the bag when the stock co

I don't know- there must be institutional players on the long side by now right? Either way, _eventually_ someone will be left holding the bag when the stock comes back down to earth.

ericmay 6y ago
Retail traders are literally locked out of buying new shares... they were a scapegoat the whole time. $GME is up 11% as of the writing of this post. Who is buying it? This is actually making me angry to watch. -edit- I had like one share - Robinhood just sold my shares without me ordering it. Dunno what happened there.
- Osiris 6y ago
  I had a pending market order fill at opening but now by brokerage mobile app won't log me in.
- dragontamer 6y ago
  I just checked my TD Ameritrade account. I'm able to buy GME just fine (though I didn't hit the "confirm" button). I know RobinHood messed up here. But... they never had a good reputation to begin with. Its an open secret that RobinHood's entire setup is kind of crap.
  - itake 6y ago
    I didn't see a failure on Schwab until I hit "confirm" yesterday. My understanding is TD Ameritrade is only blocking the purchase of stock on margin. If you have the cash, you're allowed to make the purchase.
    - swiley 6y ago
      Oh well that's reasonable. If I were a brokerage you bet your ass I wouldn't lend you money to buy GME.
      - aynyc 6y ago
        Why should broker allow margin trading at all? If it's about risk, then who's the decider/calculator of the risk? I think this is the reason why there is a distrust from the next generation.
        swiley 6y ago
        This really wouldn't be the first time Robinhood changed their software to prevent it's users from doing exceptionally stupid things with margin.
        JumpCrisscross 6y ago
        > who's the decider/calculator of the risk? The lender. As in all loans. As is in every detail described in one’s margin contract.
        aynyc 6y ago
        I looked at my margin document, other than Federal Reserve requirements and account restriction, there is no provision stating they can block a specific eligible stock as long as I meet their margin requirement.
        kgwgk 6y ago
        Their margin requirement may be linked to the name so increasing the margin requirement to 100% would be a way to block the use of margin.
        aynyc 6y ago
        That would block all margin trades, no? Not a specific instrument. I understand why they did it, but it leaves a very bad taste in my mouth.
        kgwgk 6y ago
        They can set margin requirement separately for each stock. For example, with InteractiveBrokers "long stock positions [of AMC, BB, EXPR, GME, and KOSS] will require 100% margin and short stock positions will require 300% margin until further notice". https://twitter.com/IBKR/status/1354792600004386818 https://twitter.com/IBKR/status/1354792600004386818
    - 52-6F-62 6y ago
      And that's pretty normal for highly-volatile stocks, isn't it?
  - swiley 6y ago
    I just bought NOK this morning on TD. I think it's just robinhood.
    - 12bits 6y ago
      My Canadian TD account has been giving me a 502 all morning.
      - swiley 6y ago
        Sounds about right haha.
- segmondy 6y ago
  hedge funds that shorted have to buy to close out their position, they need to buy.
- gherittwhite 6y ago
  It's annoying. The regular guy should be able to profit off this too. I was at the gym yesterday and heard like 5 people talking about stocks: gme, amc, bb. Everyone is trying to get in on this and they're trying to stop it. They bogged gme at open to scare people and now it's back up. If they didn't remove the option for users to buy they surely would have bought the dip.
  - NickM 6y ago
    Blocking people from buying a stock is not the same as blocking people from profiting off of a stock; nobody knows what the future valuation of the stock will be, so if you prevent people from buying, you may just as well be preventing them from losing money as from gaining. Keep in mind that this is very likely a zero-sum game. At some point the bubble will pop, and as many people as gained money on the way up will lose money on the way down.
    - breck 6y ago
      The bubble only needs to pop though if GME management screws it up. GME has now become a $25B hedge fund with a gaming focus. They absolutely have the ability to become long term successful given these black swans they just experienced. Now, I know *nothing* about their management, but they at least have been given a chance. Their's an Eminem song that they should be playing throughout their buildings right now. If I were them I'd sell more shares, pay down any bad debt, and invest in 10-100 of the best black swan ideas of my rank and file and see what happens.
      - NickM 6y ago
        GME has now become a $25B hedge fund with a gaming focus. I think you're confusing their market cap with their balance sheet. A $25B hedge fund has $25B in assets, but a $25B market cap does not mean that they have access to anywhere near that amount of capital. Sure, maybe they could issue a dilutive follow-on offering and bring in some cash, but who knows where the stock price will be by the time they get through the paperwork on that. And they're currently losing about half a billion per year on about $6B in revenue, so I'm not sure that an extra billion or so in cash is going to fundamentally remake the company....
- giantg2 6y ago
  Only some brokers were locking it out. Most of the traditional big names did not.
- dastx 6y ago
  > $GME is up 11% as of the writing of this post. Who is buying it? Robinhood isn't the only investment platform that allows trades on NYSE obviously. Evidently though, it had the highest volume when it comes to GME it seems.
dragontamer 6y ago
This is literally an event that options / derivatives were made for. If you're a long GME holder who feels like this price is temporary: you can buy calls or sell puts (bull-trades). Or, you can sell calls or buy puts (bear-trades). If you own a ton of the underlying and are willing to be "forced to sell" the stock, selling calls would be a marvelous option to benefit from the uncertainty of the situation. Worst case scenario, you end up holding the GME stock (ie: lost the game of musical chairs). But you'll be paid for that risk.
- myWindoonn 6y ago
  This helps sketch why derivatives for stocks should not be legally tradeable. The stock isn't supposed to be an investment vehicle, but a tool for steering the owned corporation. Indeed, this entire situation is analogous to the economics of running a GameStop-like trading post, where preorders are allowed. The store wants to sell lots of preorders in order to stay afloat even outside of release seasons, and customers want to purchase preorders in order to guarantee a low price for hyped releases. This is just like the original purpose of derivatives, which were to ensure that foodstuffs would be fairly priced for both farmers and grocers, even when prepaying for not-yet-grown crops. One would hope that GameStop would not sell preorders that it cannot guarantee from game publishers; if a game publisher promises only 100 copies to a particular brick-and-mortar, then they would be in big trouble if they took 140 preorders. Now, folks generally agree that GameStop's business model is on the way out. The stock should not be worth much, because there is not much to say about the future of the corporation, and so not much point in participating in corporate governance. But instead, it is overly-shorted, with about 140% of shares sold short. That is no longer in the spirit of derivatives, but is now a magic trick. [0] https://en.wikipedia.org/wiki/GameStop_short_squeeze https://en.wikipedia.org/wiki/GameStop_short_squeeze
itake 6y ago
My understanding is retail investors are buying stock now at $200/share, with the expectation that institutional players will be forced to buy it back at +$200/share to cover their shorts. This will leave the original holders of the shares (the ppl the shorters borrow the money from) with a stock worth less than $200, but maybe more than their original purchase. If the retail investors don't "get out", then definitely a few will be caught with the bag, but I think its mostly going to be institutional investors paying crazy prices for this stock.
- dragontamer 6y ago
  Current price is $400 actually. Seems to be a very fast moving stock however, it probably will be dramatically different in price by the time someone reads my post.
deleted 6y ago
[deleted]
hourislate 6y ago
From what I understand, BlackRock has a long stake. https://www.sec.gov/Archives/edgar/data/1326380/000083423721001340/0000834237-21-001340.txt https://www.sec.gov/Archives/edgar/data/1326380/000083423721... >BlackRock Inc. trimmed its holdings in Gamestop, Inc. (NYSE:GME) by 18.23% during the 4th quarter, according to the company in its most recent Form 13G/A filing with the SEC. The firm now owns 9,217,335 shares of GME, which represents 13.20% ownership.
- odiroot 6y ago
  Fidelity, BlackRock, Vanguard, Morgan Stanley. All the usual players. Combined they own nearly 40%
- kgwgk 6y ago
  That mostly means that BlackRock customers have a long stake. BlackRock and other asset managers own the shares because they are part of the funds and ETFs that they manage for others. They are not really theirs.
Spivak 6y ago
Yes, if WSB gets their way it will be the short sellers forced to buy a bunch of overpriced stock holding it after the crash. I would openly celebrate their loss. If all the shit to stem the tide works: shutting down discord and personal trading platforms, halting trading, yada yada works then WSB will be holding the bag. I wouldn’t really mourn their loss either because it’s a meme stock bought by people who can afford to can afford to lose.
breck 6y ago
I mean the market cap is only $25B. GameStop just also got $100M-$1B in free advertising (maybe someone in the ad biz could weigh in with a better estimate on that). If the GameStop management allocates their newfound wealth well, this stock is just as likely to perform as well as any other $25B company. They could do something like sell $2B in fresh capital and invest it in a slew of gaming startups, who then suddenly have distribution figured out. Lots of creative ways they can not squander their windfall. I know nothing about their management, but have seen many many people get a double and then hit a grand slam. All comes down to the management.

I don't know- there must be institutional players on the long side by now right? Either way, _eventually_ someone will be left holding the bag when the stock comes back down to earth.

ericmay 6y ago

Retail traders are literally locked out of buying new shares... they were a scapegoat the whole time. $GME is up 11% as of the writing of this post. Who is buying it? This is actually making me angry to watch. -edit- I had like one share - Robinhood just sold my shares without me ordering it. Dunno what happened there.

Osiris 6y ago
I had a pending market order fill at opening but now by brokerage mobile app won't log me in.
dragontamer 6y ago
I just checked my TD Ameritrade account. I'm able to buy GME just fine (though I didn't hit the "confirm" button). I know RobinHood messed up here. But... they never had a good reputation to begin with. Its an open secret that RobinHood's entire setup is kind of crap.
- itake 6y ago
  I didn't see a failure on Schwab until I hit "confirm" yesterday. My understanding is TD Ameritrade is only blocking the purchase of stock on margin. If you have the cash, you're allowed to make the purchase.
  - swiley 6y ago
    Oh well that's reasonable. If I were a brokerage you bet your ass I wouldn't lend you money to buy GME.
    - aynyc 6y ago
      Why should broker allow margin trading at all? If it's about risk, then who's the decider/calculator of the risk? I think this is the reason why there is a distrust from the next generation.
      - swiley 6y ago
        This really wouldn't be the first time Robinhood changed their software to prevent it's users from doing exceptionally stupid things with margin.
      - JumpCrisscross 6y ago
        > who's the decider/calculator of the risk? The lender. As in all loans. As is in every detail described in one’s margin contract.
        aynyc 6y ago
        I looked at my margin document, other than Federal Reserve requirements and account restriction, there is no provision stating they can block a specific eligible stock as long as I meet their margin requirement.
        kgwgk 6y ago
        Their margin requirement may be linked to the name so increasing the margin requirement to 100% would be a way to block the use of margin.
        aynyc 6y ago
        That would block all margin trades, no? Not a specific instrument. I understand why they did it, but it leaves a very bad taste in my mouth.
        kgwgk 6y ago
        They can set margin requirement separately for each stock. For example, with InteractiveBrokers "long stock positions [of AMC, BB, EXPR, GME, and KOSS] will require 100% margin and short stock positions will require 300% margin until further notice". https://twitter.com/IBKR/status/1354792600004386818 https://twitter.com/IBKR/status/1354792600004386818
  - 52-6F-62 6y ago
    And that's pretty normal for highly-volatile stocks, isn't it?
- swiley 6y ago
  I just bought NOK this morning on TD. I think it's just robinhood.
  - 12bits 6y ago
    My Canadian TD account has been giving me a 502 all morning.
    - swiley 6y ago
      Sounds about right haha.
segmondy 6y ago
hedge funds that shorted have to buy to close out their position, they need to buy.
gherittwhite 6y ago
It's annoying. The regular guy should be able to profit off this too. I was at the gym yesterday and heard like 5 people talking about stocks: gme, amc, bb. Everyone is trying to get in on this and they're trying to stop it. They bogged gme at open to scare people and now it's back up. If they didn't remove the option for users to buy they surely would have bought the dip.
- NickM 6y ago
  Blocking people from buying a stock is not the same as blocking people from profiting off of a stock; nobody knows what the future valuation of the stock will be, so if you prevent people from buying, you may just as well be preventing them from losing money as from gaining. Keep in mind that this is very likely a zero-sum game. At some point the bubble will pop, and as many people as gained money on the way up will lose money on the way down.
  - breck 6y ago
    The bubble only needs to pop though if GME management screws it up. GME has now become a $25B hedge fund with a gaming focus. They absolutely have the ability to become long term successful given these black swans they just experienced. Now, I know *nothing* about their management, but they at least have been given a chance. Their's an Eminem song that they should be playing throughout their buildings right now. If I were them I'd sell more shares, pay down any bad debt, and invest in 10-100 of the best black swan ideas of my rank and file and see what happens.
    - NickM 6y ago
      GME has now become a $25B hedge fund with a gaming focus. I think you're confusing their market cap with their balance sheet. A $25B hedge fund has $25B in assets, but a $25B market cap does not mean that they have access to anywhere near that amount of capital. Sure, maybe they could issue a dilutive follow-on offering and bring in some cash, but who knows where the stock price will be by the time they get through the paperwork on that. And they're currently losing about half a billion per year on about $6B in revenue, so I'm not sure that an extra billion or so in cash is going to fundamentally remake the company....
giantg2 6y ago
Only some brokers were locking it out. Most of the traditional big names did not.
dastx 6y ago
> $GME is up 11% as of the writing of this post. Who is buying it? Robinhood isn't the only investment platform that allows trades on NYSE obviously. Evidently though, it had the highest volume when it comes to GME it seems.

dragontamer 6y ago

This is literally an event that options / derivatives were made for. If you're a long GME holder who feels like this price is temporary: you can buy calls or sell puts (bull-trades). Or, you can sell calls or buy puts (bear-trades). If you own a ton of the underlying and are willing to be "forced to sell" the stock, selling calls would be a marvelous option to benefit from the uncertainty of the situation. Worst case scenario, you end up holding the GME stock (ie: lost the game of musical chairs). But you'll be paid for that risk.

myWindoonn 6y ago
This helps sketch why derivatives for stocks should not be legally tradeable. The stock isn't supposed to be an investment vehicle, but a tool for steering the owned corporation. Indeed, this entire situation is analogous to the economics of running a GameStop-like trading post, where preorders are allowed. The store wants to sell lots of preorders in order to stay afloat even outside of release seasons, and customers want to purchase preorders in order to guarantee a low price for hyped releases. This is just like the original purpose of derivatives, which were to ensure that foodstuffs would be fairly priced for both farmers and grocers, even when prepaying for not-yet-grown crops. One would hope that GameStop would not sell preorders that it cannot guarantee from game publishers; if a game publisher promises only 100 copies to a particular brick-and-mortar, then they would be in big trouble if they took 140 preorders. Now, folks generally agree that GameStop's business model is on the way out. The stock should not be worth much, because there is not much to say about the future of the corporation, and so not much point in participating in corporate governance. But instead, it is overly-shorted, with about 140% of shares sold short. That is no longer in the spirit of derivatives, but is now a magic trick. [0] https://en.wikipedia.org/wiki/GameStop_short_squeeze https://en.wikipedia.org/wiki/GameStop_short_squeeze

itake 6y ago

My understanding is retail investors are buying stock now at $200/share, with the expectation that institutional players will be forced to buy it back at +$200/share to cover their shorts. This will leave the original holders of the shares (the ppl the shorters borrow the money from) with a stock worth less than $200, but maybe more than their original purchase. If the retail investors don't "get out", then definitely a few will be caught with the bag, but I think its mostly going to be institutional investors paying crazy prices for this stock.

dragontamer 6y ago
Current price is $400 actually. Seems to be a very fast moving stock however, it probably will be dramatically different in price by the time someone reads my post.

deleted 6y ago

[deleted]

hourislate 6y ago

From what I understand, BlackRock has a long stake. https://www.sec.gov/Archives/edgar/data/1326380/000083423721001340/0000834237-21-001340.txt https://www.sec.gov/Archives/edgar/data/1326380/000083423721... >BlackRock Inc. trimmed its holdings in Gamestop, Inc. (NYSE:GME) by 18.23% during the 4th quarter, according to the company in its most recent Form 13G/A filing with the SEC. The firm now owns 9,217,335 shares of GME, which represents 13.20% ownership.

odiroot 6y ago
Fidelity, BlackRock, Vanguard, Morgan Stanley. All the usual players. Combined they own nearly 40%
kgwgk 6y ago
That mostly means that BlackRock customers have a long stake. BlackRock and other asset managers own the shares because they are part of the funds and ETFs that they manage for others. They are not really theirs.

Spivak 6y ago

Yes, if WSB gets their way it will be the short sellers forced to buy a bunch of overpriced stock holding it after the crash. I would openly celebrate their loss. If all the shit to stem the tide works: shutting down discord and personal trading platforms, halting trading, yada yada works then WSB will be holding the bag. I wouldn’t really mourn their loss either because it’s a meme stock bought by people who can afford to can afford to lose.

breck 6y ago

I mean the market cap is only $25B. GameStop just also got $100M-$1B in free advertising (maybe someone in the ad biz could weigh in with a better estimate on that). If the GameStop management allocates their newfound wealth well, this stock is just as likely to perform as well as any other $25B company. They could do something like sell $2B in fresh capital and invest it in a slew of gaming startups, who then suddenly have distribution figured out. Lots of creative ways they can not squander their windfall. I know nothing about their management, but have seen many many people get a double and then hit a grand slam. All comes down to the management.