David Costing Goliath Billions

a reply to: FauxMulder

The dangerous part about this is that they had naked shorts... And a lot of those were on margin (borrowed money from the broker).

This leaves them with only two options... Buying the underlying stock to unwind their short, or come up with cash to cover the margin before their broker margin calls them (forced liquidation of equities until margin is met).

People are selling speculation stocks to hop in, and others are selling to cover. We'll likely see ripples for a while.

Thanks guys. I've lost enough before to know how important patience is and that if something looks too good to be true, it probably is. Except Moderna. I made a killing on that (luck)

originally posted by: FauxMulder
The volume right now on game stop is ridiculous.

This is a real life version of watching the Duke Brothers get squashed.

So.... should i buy now? Or is the craze over?

originally posted by: Ohanka
So.... should i buy now? Or is the craze over?

I don't think it's over yet but I like watching this one from the sidelines

originally posted by: Ohanka
So.... should i buy now? Or is the craze over?

Depends what your risk tolerance is and your understanding of how short squeezes work.

The dance will likely end faster than it started.

Friday is going to be a blood bath when all the options are reconciled.

a reply to: CriticalStinker

I saw some post from people on stock twits saying they are ruined and short at $86.

Part of me wants to feel bad for them but then again, I really don't like short sellers. A lot of times they short good companies and screw longs over in the process.

a reply to: FauxMulder

Somebody is dunking with a fake Twitter account. Melvin Capitol was vocal about shorting Tesla.

Profanities warning.

originally posted by: CriticalStinker

Friday is going to be a blood bath when all the options are reconciled.

I did the math earlier. The guy I posted earlier in the thread that bought 50 115 calls is up over a million on those.

Yesterday I messed around and bought a 10 dollar put on it for $25. Somehow I'm up $71.

This stuff is absolutely crazy right now.

a reply to: Ohanka

If you have a gambling budget you could have some fun throwing it in the pile, though the buy in is getting crazy. We got a few when it was at $80 and thought that was steep, then got a few more this morning. As i type this it's trying to break $380.

a reply to: Ksihkehe

Lol. They're not that far off

a reply to: FauxMulder

They could have gotten put options and minimized their risk. I don't feel sorry for people who don't understand what they're doing.

Before the order goes through on a short sale, it warns you the loss potential is infinite.

I have one call option ending Friday... It's a 100c I got on Monday when the stock was at 85... So far I'm on the right side of the trade, lol.

originally posted by: CriticalStinker
a reply to: FauxMulder

They could have gotten put options and minimized their risk. I don't feel sorry for people who don't understand what they're doing.

I think most of them are margin trading to avoid the capital gains tax. If I recall correctly a straight option triggers it, but margin profits are taxed as regular income. Maybe somebody can chime in on that.

I was licensed for commodities futures trading, but most of the tax rules are things I picked up in cryptocurrency. The best way to make money in derivatives will shift to crypto contracts in a few years. The residuals from holding underlying smart contract tokens will be safer and easier than trading straight assets. It will be interesting to see how the dynamics change as many crypto devs are very much into empowering the little guy.

a reply to: FauxMulder

I get why people would buy in. It's a chance to gamble and make a come up. Thing is, that stock is so volitile while having NO real value since gamestop is a failing company. Investing here is like buying scratch offs. I wouldn't put any money anywhere near this stock. You're just waiting on someone with a ton of shares to sell and hoping your on the right side of history.

a reply to: Ksihkehe

The tax side is one I'm far less versed in.

The only part I know is equities bought and sold in under a year are taxed as income... And those held over a year are the flat capital gain of 14%.

That being said, there are ways to circumvent some of that like lost harvesting, and others. But this is where I am not as knowledgeable.

One the stocks I bought into has its trading halted because of this.

a reply to: strongfp

A lot of halts have happened today.

I imagine a lot of hedge funds are rebalancing their portfolio over this.

Down to 300 but people say it could go to 5000?

Somewhere 2 guys are exchanging a dollar....(I hope some of you get the reference) this is great...

a reply to: matafuchs
Winthorpe and Valentine?