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by lxbky 6y ago

[deleted]

Triv888 6y ago
Don't put all of your eggs in the same basket. I have no clue how anyone, especially edge funds, could get majorly impacted by just one stock moving the wrong way. I have stocks in my portfolio that move 25 to 50% the wrong way almost everyday and I still get about 1% overall gain daily in this bull market (which is probably not great in this economy).
- deleted 6y ago
  [deleted]
- njanirudh 6y ago
  Because you don't get 10 or 100x leverage like hft guys get.
- thatguy0900 6y ago
  Shorts are a little unique in that the risk is technically infinite. Stocks you own can only lose whatever value you bought them for. Stocks youve promised to buy later from someone else, though, can lose you however much money they decide to charge you when you have to buy. They could have thousands of profitable positions and lose 2 billion off one very unlucky short call because of a meme.
  - Triv888 6y ago
    Good point. Maybe they will learn something?
    - thatguy0900 6y ago
      Well, I can't imagine we'll see any stocks shorted to 128% for a very long time. Probably not much else
    - marvin 6y ago
      Not a chance. The human mind generally isn't built to correctly assess the impact of unlikely, catastrophic events. Maybe they'll steer clear of excessive short selling for a while, but you can be sure they'll forget it eventually. In the meantime, they'll find some other pitfall to step in.
themihai 6y ago
Well, your dad decided to side with one or more large, faceless hedge fund managers known for burning down several companies to the ground. He bet against the retailers and be bet against GameStop company. There will always be losers and winners but at least you should own your position/side. I guess loosing on the wrong side of the fence feels even worse.
optimiz3 6y ago
Long time investor doesn't mean good trader, and shorting is trading. Only fools stay short for a long time. Fees, theta, and margin interest will eat you alive. Plus there's the near infinite downside if you're wrong. Fantastic thread on shorting: https://twitter.com/HedgeDirty/status/1254767346784313344 https://twitter.com/HedgeDirty/status/1254767346784313344
- blackrock 6y ago
  That was entertaining to read. Thanks for the lolz.

[deleted]

by lxbky 6y ago

[deleted]

Don't put all of your eggs in the same basket. I have no clue how anyone, especially edge funds, could get majorly impacted by just one stock moving the wrong way. I have stocks in my portfolio that move 25 to 50% the wrong way almost everyday and I still get about 1% overall gain daily in this bull market (which is probably not great in this economy).

deleted 6y ago
[deleted]
njanirudh 6y ago
Because you don't get 10 or 100x leverage like hft guys get.
thatguy0900 6y ago
Shorts are a little unique in that the risk is technically infinite. Stocks you own can only lose whatever value you bought them for. Stocks youve promised to buy later from someone else, though, can lose you however much money they decide to charge you when you have to buy. They could have thousands of profitable positions and lose 2 billion off one very unlucky short call because of a meme.
- Triv888 6y ago
  Good point. Maybe they will learn something?
  - thatguy0900 6y ago
    Well, I can't imagine we'll see any stocks shorted to 128% for a very long time. Probably not much else
  - marvin 6y ago
    Not a chance. The human mind generally isn't built to correctly assess the impact of unlikely, catastrophic events. Maybe they'll steer clear of excessive short selling for a while, but you can be sure they'll forget it eventually. In the meantime, they'll find some other pitfall to step in.

themihai 6y ago

Well, your dad decided to side with one or more large, faceless hedge fund managers known for burning down several companies to the ground. He bet against the retailers and be bet against GameStop company. There will always be losers and winners but at least you should own your position/side. I guess loosing on the wrong side of the fence feels even worse.

optimiz3 6y ago

Long time investor doesn't mean good trader, and shorting is trading. Only fools stay short for a long time. Fees, theta, and margin interest will eat you alive. Plus there's the near infinite downside if you're wrong. Fantastic thread on shorting: https://twitter.com/HedgeDirty/status/1254767346784313344 https://twitter.com/HedgeDirty/status/1254767346784313344

blackrock 6y ago
That was entertaining to read. Thanks for the lolz.