GameStop Craziness!!

[stanley]

Not sure if any of you were watching this saga.  Would be hard to miss if you are invested in the market and track your portfolio at any basic level. 

https://www.wsj.com/articles/keith-gill-drove-the-gamestop-reddit-mania-he-talked-to-the-journal-11611931696

For me, like most folks, the VAST majority of my portfolio (both retirement and other wise) is of course in mutual funds focused on growth (S&P, Dow, NASDAQ, plus a little international stuff....).  I do, however keep some off to the side in individual stocks that I monitor/move/play-with(🙄)  mainly because it is interesting to me and I enjoy it.   That being said though, I generally don't get into short positions or too much speculation.

Amazing how big this blew-up, and also for sure exposes what most investors knew already, which is the 'big boys' rule the market and will take steps to control things to their advantage however and whenever they see fit!  Anyway, curious how closely others are watching this deal??

S.

[Chef]

I've been watching it very closely.

Some inventors on WSB are making major gains with this and AMC, BB, etc.

Unfortunate that the hedge funds have the power to degrade a company's stock for their greedy purposes.

It's also not fair that they get to trade after hours.

...and don't get me started on RH and other apps restricting trading of said stocks...Market Manipulation!

Okay, I've said my piece!

[AZAV8ER]

The hedge funds shorting GameStop were generally making the obvious call, GameStop's future was not bright. That said, and not being a fan of stock shorting, I have no problem seeing the hedge fund people getting burned at their game. I do have concern for the Investors that got in at these stratospheric levels, I see a bad outcome for those that paid top dollar for this stock.

[yotebuster]

I’m still waiting for my Enron stock to bounce back.  🤞

[Chef]

1 hour ago, AZAV8ER said:

The hedge funds shorting GameStop were generally making the obvious call, GameStop's future was not bright. That said, and not being a fan of stock shorting, I have no problem seeing the hedge fund people getting burned at their game. I do have concern for the Investors that got in at these stratospheric levels, I see a bad outcome for those that paid top dollar for this stock.

The problem is the hedge funds "bet" on Gamestop's demise and manipulated the market by undervaluing the stock.  They stood to make a killing $ if their forecast came through.

Now that retail inventors (us) are buying, the hedge funds are forced to buy more shares to cut their losses, which in turn raises the share price even more.  This is such an interesting

turn of events that it will bring on regulation and hopefully uncover the shady practices of the hedge funds.

[CouesPursuit]

I know very little about the market but I am so intrigued by what is happening. 

[Outdoor Writer]

Although I have nothing to lose or gain, I've been following along. I do not dabble in the markets other than with the NASDAQ-heavy mutual fund I've had for years. It's made me a nice annual return, and so far this year, it's up 22%. It kind of went in the tank two days ago but then came back more than half yesterday. But today isn't looking too good right now. 🤬 Still, I rarely let the bad days bother me since I'm in for the longer haul.

[stanley]

2 hours ago, AZAV8ER said:

The hedge funds shorting GameStop were generally making the obvious call, GameStop's future was not bright. That said, and not being a fan of stock shorting, I have no problem seeing the hedge fund people getting burned at their game. I do have concern for the Investors that got in at these stratospheric levels, I see a bad outcome for those that paid top dollar for this stock.

 

55 minutes ago, Chef said:

The problem is the hedge funds "bet" on Gamestop's demise and manipulated the market by undervaluing the stock.  They stood to make a killing $ if their forecast came through.

Now that retail inventors (us) are buying, the hedge funds are forced to buy more shares to cut their losses, which in turn raises the share price even more.  This is such an interesting

turn of events that it will bring on regulation and hopefully uncover the shady practices of the hedge funds.

 

Ya, I generally agree with both of you regarding the hedge funds and their bet (and manipulation) on the stock to go down.

The whole 'short position' thing has always been strange to me.  A very good friend of mine has been a broker/adviser for many years.  He and I have debated the merits and pit-falls of shorting stocks around the campfire many times over the years.  For me, I think I'm too old-school.  The idea of speculating on a stock going down and making money off that position just seems odd to me.  I tend  to focus on growth as my go-to position, so the shorting just seems anti intuitive. 

Anyway, this was just sort of a 'little guy' vs. big institutional situation that stood-out and caught my attention.  For me, I'm sticking with my mutual funds and a few dividend stocks.  

[Redman]

It's criminal what Robinhood did to  protect their billionaire hedge fund pals- capitalism and free speech is dead! 

DOGE cryto today!!   

[Ohthatguy]

On 1/30/2021 at 1:14 AM, Chef said:

The problem is the hedge funds "bet" on Gamestop's demise and manipulated the market by undervaluing the stock.  They stood to make a killing $ if their forecast came through.

Now that retail inventors (us) are buying, the hedge funds are forced to buy more shares to cut their losses, which in turn raises the share price even more. 

I don't see how betting that a stock will go down and profiting from that downward move is bad at all. If you are long, you are betting that it will go up. Stocks get pumped all the time to ridiculous valuations based on lies and manipulation only to have them come crashing back down.  If you want every stock to be priced at 10X what they "should" be trading at, eliminate all the short sellers and fasten your seat belts. I mean the S&P at 37,000.00 can't be bad. Right?  

The many factors at play in this epic short squeeze are truly amazing and it's absolutely mind boggling to watch play out. Short interest is still over 120% of the float so I don't think this wild ride is over yet. (That is in NO WAY a recommendation to get involved in this or any stock in any way, shape or form)  

You stated that they "...manipulated the market by undervaluing the stock."   Just curious what you think the stock is currently worth?  Do you think it's manipulation to have a bunch of people simply buy it because it's heavily shorted? 

 

[Redman]

7 hours ago, Ohthatguy said:

I don't see how betting that a stock will go down and profiting from that downward move is bad at all. If you are long, you are betting that it will go up. Stocks get pumped all the time to ridiculous valuations based on lies and manipulation only to have them come crashing back down.  If you want every stock to be priced at 10X what they "should" be trading at, eliminate all the short sellers and fasten your seat belts. I mean the S&P at 37,000.00 can't be bad. Right?  

The many factors at play in this epic short squeeze are truly amazing and it's absolutely mind boggling to watch play out. Short interest is still over 120% of the float so I don't think this wild ride is over yet. (That is in NO WAY a recommendation to get involved in this or any stock in any way, shape or form)  

You stated that they "...manipulated the market by undervaluing the stock."   Just curious what you think the stock is currently worth?  Do you think it's manipulation to have a bunch of people simply buy it because it's heavily shorted? 

 

I think we are on the same page, there is nothing wrong with betting it goes down or up....that is what the stock market is.

The problem is the rules changed mid game- the billionaire hedge fund guys got the rules changed so the public couldn't buy more shares of Gamestop - the shares could only be sold... this is absolutely criminal-never in the history of the stock market has this been done 

Imagine if this was done with the ammo shortage - people could only sell 9MM, 223, 380, etc ammo (and  not buy these because these were too dangerous), but these same people were still able to buy 30-06, .270, etc.   

[mattys281]

It’s a pretty bad precedent that brokerage firms like Robinhood and others get to decide who can and can’t trade any security.  Those companies have revealed themselves for the scumbags they are, so if anyone stays with them it’s their own fault from this point forward.  they should be sued out of existence.  
 

Also, if this episode has revealed anything at all it’s that people should be allowed direct access to the exchanges, it’s nothing but a money making scheme to force people to go through obviously corrupt gatekeeper organizations 

[HuntHarder]

I love that people are starting to get a glimpse at how exactly the market works.  I have co-workers who have never traded before asking questions.  Some are fully engulfed in the GME scheme now.  I piggy backed off of it and made some nice gains on AMC and AAL. 

This market is flat out fun and most are making money in it.  Trade wisely and enjoy the extra money!

[azelkhunter69]

On 2/1/2021 at 4:42 AM, Redman said:

I think we are on the same page, there is nothing wrong with betting it goes down or up....that is what the stock market is.

The problem is the rules changed mid game- the billionaire hedge fund guys got the rules changed so the public couldn't buy more shares of Gamestop - the shares could only be sold... this is absolutely criminal-never in the history of the stock market has this been done 

Imagine if this was done with the ammo shortage - people could only sell 9MM, 223, 380, etc ammo (and  not buy these because these were too dangerous), but these same people were still able to buy 30-06, .270, etc.   

I follow the Market every day.  There is no proof that anything was done by the "big guys" to influence RH into restricting trading.  I will admit, I thought the same thing when I saw what happened.  But, from what I have seen and read,  it had more to do with RH meeting regulatory requirements and protecting themselves from enormous losses.  Apparently, a lot of these people that were trading GME were doing so on Margin and didn't have a care in the world if they lost money...because it wasn't theirs.  RH is required to cover those $$.  Also, the settlement period came into play.  RH didn't have the capital reserves to cover that either.  RH is a relatively small player and suffered some serious growing pains in this mess.  And as far as people saying the "Big guys" didn't get hurt and manipulated the market, tell that to Melvin Capital.  They took a $2 Billion hit on their short position.  They announced the lost 51% in January.  OUCH.  There will be changes and more regulation as a result.

 

Huntharder, I also jumped in and made 41% on AAL.  Not as much as some did, but not as much as a lot of people lost either.  People are getting crushed on the way down.  GME went from $500 to $90.....on it's way lower.  How many people lost their houses, life savings, etc. ?  Be smart out there.

[pirogue]

Interesting to see “Robbing the Neighborhood” app get so many 1 stars last week, after accounts froze.  Then these 1 star ratings are erased and rating goes up.  Turns up that one of the firms giving RH a cash infusion last week, was a firm that was an early investor in Google.  Big Tech controlling again.