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Chief
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Additional Posts in Personal Investment Chatter
Enthusiast
ICLN or TAN for clean energy long term?
Finally, eligible to buy T$LA 😁
Conversation Starter
AMZN buy more or hold?
What stocks are you betting on for 2018?
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These are currently targets because they are very highly shorted. Meaning, many firms bet that they would go down, and those bets are coming due soon. They have to buy shares to close out their bets, and every time they buy, it drives the price up higher.
You’re thinking of Persing Capital’s Bill Ackman’s short call on Herbalife in 2014/2015 that he held unto for 5 years before closing out his position in 2019 at a $1b loss.
Yes buy buy buy
Enthusiast
I second this !
Buy $GME
GME is gone. AMC and NOK are the next big targets. Trading has halted several times today or they would have spiked more. There is still momentum on these 2 through the rest of this week
Pro
GME definitely not gone lol
Conversation Starter
If you don’t understand it, don’t get into it. Invest, don’t gamble. If you buy GME at 330$ today, you’re betting that a greater fool will pay you more than 330$ tomm. A bit improbable for a stock whose value is ideally close to 16$
Chief
The thing for me is, you obviously don’t want to be the last one out. As the shorts are executed they’re probably selling too. So would need to know what short positions are because once they’re out there is no reason for the price to be $200 or even $100
Blackberry hasn't had a huge pop yet, so I'd pick up some of that if anything, especially if you can get in under $22. I started buying it heavy at $12 and added several thousand more at $17 and then a bit more at 21/22. It's made me a solid $50k or so and my hope is I can get another $50-$100k+ out of it. Nothing like Gamestop winnings but it's good enough for me.
Thanks! It's nearly all unrealized gains so I could lose it all tomorrow (but I continue to believe the upside is far better than the downside + we're entering a golden age for speculative investing and an historic bull market). I did liquidate most of my NOK today which had some tasty gains.
Pro
GME is still in play. It’s a complete bet with zero logic. If you believe that people will hold the line then buy. I’m all in 💎🙌🏼
Just made a dollar :).
My investments are monitored, so I need manager approval and must hold anything I buy for at least 30 days 🥲
I'm paid well, but definitely missing out. I did buy KODK earlier in the month though, so my time will come.
I work in payments, nowhere near our Merrill arm...still a suit?
I’m all in AMC and NOK. I never pull out 💦💦💦
Pasting this from a Reddit thread:
Short selling involves borrowing a stock from someone who owns it with the promise to return it at a later date, and pay a small fee based on the value of the stock. You then sell the stock, wait for the price to drop and buy it back at a cheaper price. You then return the stock to the original owner and pocket the difference.
This allows people to make money off of a drop in the price of a stock. Unlike with regular stock trading, however, the potential losses of you are wrong are not limited. If you buy a $10 share in a company and the company goes bankrupt, you lose $10. If you short a company with a $10 share price, and that price jumps to $100 per share, you just lost $90.
Since the start of the pandemic, GameStop has clearly been struggling in a big way. Such a big way, that a lot of people, including major hedge funds, decided to short GameStop. A lot.
Let’s say I own a share of GameStop stock and you want to short it. I lend you my share, and you sell it. Now someone else wants to short the stock as well, so they borrow the share from the person you sold it to and then they sell it. And so on. If this happens enough times, you can have more people who owe back a share to the “original” owner than there are actual shares of the stock.
This happened to GameStop which had 140% of its share sold short. This presents a problem for short sellers if the price of the stock starts going up instead of down, because there aren’t enough shares to go around if they decide they all need to cut their losses and buy back the shares they owe at once.
Some smaller investors, including those at r/wallstreetbets, noticed this happening to GameStop’s stock and decided to take advantage. They bought up a bunch of shares themselves, driving the price up and further limiting the availability of shares. This caused some short sellers to pull out, which drove the price up further, which caused more short sellers to pull out, and so on.
Meanwhile, the attention brought to this story and the quickly rising share price caused more people to buy the stock in the hope of taking advantage of the meteoric rise in price to make money themselves.
Back in the summer, you could buy a share for $4 apiece. Yesterday, those same shares were $147 each. Today they’re $345. The big hedge funds that were selling the stock short are currently literally billions in the hole while the smaller investors are making money hand over fist.
That all said, GameStop is still a struggling company underneath it all. It is nowhere near as valuable as its current share price, which means that, eventually, the bubble is going to burst and the price is going to come crashing back down. Anyone who buys in at the top expecting it to keep shooting up is going to lose a ton of money. Anyone still shorting it at that time is going to make a ton of money, and anyone who bought it early and sells before it pops is going to make a ton of money.
It’s not entirely clear whether the hedge funds are going to wind up actually losing billions in the end or if they can recoup some of that when the bubble bursts (they may or may not come out ok), but there are definitely going to be a bunch of people currently riding the hype train who lose whatever they invest at this point.
https://www.reddit.com/r/OutOfTheLoop/comments/l6oekh/megathread_wallstreetbets_stock_market_gamestop/gl1vw6e/?utm_source=share&utm_medium=ios_app&utm_name=iossmf&context=3
Thanks for posting but can you share the cliff notes? This is a damn novel.
Look up ‘short squeeze’ and then decide for yourself
$SNDL is the next one folks. Retail investors love the low priced ones the best. Get in now while you can. $SNDL
Weed is tight
NOK. BUY AND HOLD DO NOT BE SCARED
Chief
When to sell?
Depends how much you can spare/possibly lose. It’s called wallstreetbets for a reason - we’re all gambling here knowing we could lose it all.
So if you are trying to get rich quick - that’s a personal choice about how much risk you’re willing to take on. But if you wanna get in and buy a few shares to support your mates and f*ck the hedge funds then BUY AND HOLD GME 💎🚀
In the name of our lord & savior DeepFuckingValue - WE LIKE THE STOCK 🚀
NOK and AMC 🚀
Is there a way to know which company is going to be targeted next? I want to get in on the action but my mantra in investing has always been slow and steady so this is new territory here...
Chief
Here’s how you see the top shorted stocks. Fubo for instance rose today because of this https://www.highshortinterest.com
No, there is no way to know. These stocks are technical anomalies and there are going to be investigations into how this was allowed to happen. No one is looking for the next stock that does this.
If you're looking for stocks that have potential for short squeezes, you can look, as ONE indicator, at percentage of shares shorted. But if you don't understand how to follow it, you're just as likely to go long on a stock that's heavily shorted for a reason, and being held up artificially. Then, whoever is propping it up, backs off, and the stock crashes.
What happened/is happening with GME (to such a large degree) is not something that traders are looking for, because it just doesn't happen with any regularity.
Will also add, from a technical perspective, when you short a stock, you are actually borrowing it from someone else and selling it. The way you can technically get to more than 100% is because trades take 2-3 days to settle. Which means, you can buy or sell, but don't (technically) have to deliver the cash or stock to your broker until the settlement date. It's a relic of the past when shares were evidenced by physical share certificates, and brokers took an investor/trader at their word that they would deliver as promised.
So, your brokerage firm is saying, we're borrowing this from A, but then for whatever reason, A no longer has the stock to lend (this is by definition what happens when the shorts exceed 100%), so your broker says "sh*t we couldn't allow you to borrow that stock and sell it, so now you have to deliver the stock back to us." And the only way for you to deliver the stock back, is to buy. But if all shorts now have to buy the stock to deliver it back to their brokers, the stock price starts going up quickly, because the sales are forced, and many brokers are likely in liquidation procedures and placing market orders for you. And when so many are placing market orders the stock price can go up or down VERY quickly, depending on which direction the orders are for (here, market buy orders). And since stock volume is, generally, pretty consistent on an individual stock, the depth of the asks are often based on that volume amount. So when there are all of a sudden so many buy orders, the asks get hit very quickly.
For whoever is interested in this, I recommend getting a trading portal, something like Fidelity ATP is free I think, and you can look at level 2 quotes. You can look at depths of the published books that way to get an idea of how it works.
Chief
Outside of retirement I use Robinhood. It takes F O R E V E R for trades to settle which in these cases could cost thousands of dollars (say I want to sell GME today at $300 but it settles on Friday at $280). Any way to avoid this?
Chief
TD only gave errors when the stock price was going bonkers. I was able to buy AMC around 9am. Didn’t have any issues buying NOK, NAKD or AAL.
You’re asking the wrong question. Just buy and get rich tomorrow. It’s so easy.
Chief
I am super nervous. I don’t watch the market all day because I’m working. What if I miss the window the sell? What’s the end game here for GME, AMC, and NOK so I can be prepared?