GME - Game Stop Corp

[widenthemoat]

I'm not sure this can be controlled in a politically correct way anymore. Dogecoin is up 220% right now. There is clearly way too much cheap money available and people are buying anything in sight that is trending up. Is this what finally causes the Fed to raise rates or increase margin requirements? I know Jay Powell dismissed the idea yesterday, but this is really getting out of hand. At some point enough is enough and people need to understand that risk does exist and losses do happen. The Fed can't keep bailing everyone out constantly, otherwise this nonsense spreads like wildfire.

 

I don't see the relevance, what is the trade volume in dogecoin?

 

Just relevant to GME in regards to market euphoria. I probably should have posted that somewhere else, but obviously GME shares are part of this euphoria.

[Ronchong]

Is anyone concerned about the solvency of the brokers/market? Ortex calculated the losses on short position to be $70B so far. A drop in the ocean for now but there are people reporting that GME was on a path to infinity squeeze and was executed for 1k/2k per share before the brokers decides to collectively restrict trading in all the meme stocks. Gut feel is that the brokers/market makers were loose with their risk management (yet again) and are now caught with their pants down. The collective restriction yesterday was really shady

[TwoCitiesCapital]

Is anyone concerned about the solvency of the brokers/market? Ortex calculated the losses on short position to be $70B so far. A drop in the ocean for now but there are people reporting that GME was on a path to infinity squeeze and was executed for 1k/2k per share before the brokers decides to collectively restrict trading in all the meme stocks. Gut feel is that the brokers/market makers were loose with their risk management (yet again) and are now caught with their pants down. The collective restriction yesterday was really shady

 

IB CEO estimated $10-15B alone in transfers on GME options (I e. Some peop made $10-15B and some people lost $10-15B). That's his excuse for halting trading - protect the markets from intermediary failures in brokerages and clearinghouses.

 

Robinhood supposedly drew hundreds of millions on its credit lines today. My guess is that wasn't just precautionary.

[aws]

Dogecoin just passed Fairfax in market cap.  Up like 1000% since yesterday morning.  The WSB boys have to trade something if they can't trade GME.  Incidentally crypto is not SIPC insured.

[Ronchong]

IB CEO estimated $10-15B alone in transfers on GME options (I e. Some peop made $10-15B and some people lost $10-15B). That's his excuse for halting trading - protect the markets from intermediary failures in brokerages and clearinghouses.

Robinhood supposedly drew hundreds of millions on its credit lines today. My guess is that wasn't just precautionary.

 

Robinhood CEO then went on CNBC to say that they have no liquidity problem. Hmmmmm

[bizaro86]

Is anyone concerned about the solvency of the brokers/market? Ortex calculated the losses on short position to be $70B so far. A drop in the ocean for now but there are people reporting that GME was on a path to infinity squeeze and was executed for 1k/2k per share before the brokers decides to collectively restrict trading in all the meme stocks. Gut feel is that the brokers/market makers were loose with their risk management (yet again) and are now caught with their pants down. The collective restriction yesterday was really shady

 

IB CEO estimated $10-15B alone in transfers on GME options (I e. Some peop made $10-15B and some people lost $10-15B). That's his excuse for halting trading - protect the markets from intermediary failures in brokerages and clearinghouses.

 

Robinhood supposedly drew hundreds of millions on its credit lines today. My guess is that wasn't just precautionary.

 

Robin Hoods deposits with the clearing houses would be up dramatically in this series of events. That's a liquidity issue for sure, but isn't a solvency issue.

 

It only becomes a solvency issue if its customers can't pay for the orders they've made. To that end, dramatically increased margin requirements seem appropriate. But iirc they are already at 100% margin required for GME stock and long options. Hard to see how that could get them in trouble then - if it goes to zero you haven't lent any money on it. Feels like a situation where that's the clients problem not your problem.

 

I doubt Robin hood has significant exposure to short shares/options, but I could see not allowing that.

[DooDiligence]

The yolotards don’t care about blowing up but RH has to follow the rules.

 

 

Sounds right?

[Spekulatius]

$GME is the blue chip in the WSB portfolio, perhaps with PLTR and has recovered better than the rest apparently (AMC, BB etc.). GME  is back at $340, almost a triple from the lows yesterday.

 

Why are we dealing with duds like BRK again?

[DooDiligence]

$GME is the blue chip in the WSB portfolio, perhaps with PLTR and has recovered better than the rest apparently (AMC, BB etc.). GME  is back at $340, almost a triple from the lows yesterday.

 

Why are we dealing with duds like BRK again?

 

It’s the perfect setup.

Imagine the tard backlash if some douche started shorting Grandpas company.

 

;D

[Liberty]

I wrote some thoughts about WSB/GME in the intro of this, if anyone is interesting:

 

https://libertyrpf.substack.com/p/84-my-thoughts-on-wsb-phenomenon

[Pelagic]

Luckily I had at least one brokerage that let me short GME options.  Shorted some deep ITM puts, although I didn't get as many as I wanted before the price dropped a lot (the puts I was selling dropped by 50% when the stock lost 50% of its value, pretty funny).  Ended up shorting 50 July $4 puts for about 1.01 each.  Also shorted some June AMC 0.50 puts for like .11.  Both seem like free money given likely stock offerings protecting the companies from any risk of immediate bankruptcy.  Now I have some skin in the game with the WSB folks, although my risk profile is just a bit different.

 

Joined you in this this morning. A bit in the 4s, 5s, and 6s targeting  ~30% return on at risk capital.

 

Realistically GME in the low single digits isn't a terribly risky buy, in the unlikely scenario it ever comes back down there. I think it was the IBKR CEO that wanted to halt trading until it was back to $17 which he considers fair value, my own opinion of fv is probably a bit lower but I don't think it matters anymore. Basically a volatility trade and vol is going to fade.

[alpha]

with options expensive, has anyone risked just straight shorting this at this point of 300+ price?

 

I saw a Bloomberg headline this AM suggesting Citron and Melvin had both covered.

 

So at this point, what is supporting it at $380 instead of the $17 it traded at just 3-weeks ago before this orchestrated manipulation occurred? I would expect now that the thesis has played out - and now the short squeeze forced - people would dump the shares to collect the "tendies"? Why is this still going higher?

 

It looks like the wallstreetbets subreddit has gained over 1.2 million subscribers in the last 48 hours (1.9m to 3.1m). It's just a mob mentality throwing money at the wall because they see their friends making money. At some point the trend will reverse when players start realizing their gains and price will drop as fast as it went up... your guess is as good as mine when that happens but I think it's obvious it will be sooner rather than later, especially if government checks are delayed...

 

Up to 6.2m subscribers now  :o

[AzCactus]

with options expensive, has anyone risked just straight shorting this at this point of 300+ price?

 

I saw a Bloomberg headline this AM suggesting Citron and Melvin had both covered.

 

So at this point, what is supporting it at $380 instead of the $17 it traded at just 3-weeks ago before this orchestrated manipulation occurred? I would expect now that the thesis has played out - and now the short squeeze forced - people would dump the shares to collect the "tendies"? Why is this still going higher?

 

It looks like the wallstreetbets subreddit has gained over 1.2 million subscribers in the last 48 hours (1.9m to 3.1m). It's just a mob mentality throwing money at the wall because they see their friends making money. At some point the trend will reverse when players start realizing their gains and price will drop as fast as it went up... your guess is as good as mine when that happens but I think it's obvious it will be sooner rather than later, especially if government checks are delayed...

 

Up to 6.2m subscribers now  :o

 

As the great Gwen Stefani says "This shit is bananas, b-a-n-a-n-a-s" lol

[Jurgis]

Up to 6.2m subscribers now  :o

 

Would you rather follow Kardashians or WSBs?  ::)

[TwoCitiesCapital]

Up to 6.2m subscribers now  :o

 

Would you rather follow Kardashians or WSBs?  ::)

 

WSBs - hands down

[backtothebeach]

They added strike prices up to $800 to the option chain, possibly adding fuel to the fire. Quite incredible.

 

The Feb05 800 call is $43 with an IV of 760%. (Stock at $290 with one week to expiration).

 

The 600 call is $64.

 

Juicy premiums.

 

If I had unlimited capital I'd do a ratio spread...or simply short the 800 call and roll it forward for as long as necessary. But ... I don't.

[adesigar]

The quickest way this goes away is if GME takes advantage of the current price and issues new shares.

[shamelesscloner]

They added strike prices up to $800 to the option chain, possibly adding fuel to the fire. Quite incredible.

 

The Feb05 800 call is $43 with an IV of 760%. (Stock at $290 with one week to expiration).

 

The 600 call is $64.

 

Juicy premiums.

 

If I had unlimited capital I'd do a ratio spread...or simply short the 800 call and roll it forward for as long as necessary. But ... I don't.

 

This is a cringe-worthy newbie question, but who makes money by expanding the option chain? And is it riskless profit?

[LC]

The quickest way this goes away is if GME takes advantage of the current price and issues new shares.

 

What are the shorts willing to pay, is the question.

[bizaro86]

They added strike prices up to $800 to the option chain, possibly adding fuel to the fire. Quite incredible.

 

The Feb05 800 call is $43 with an IV of 760%. (Stock at $290 with one week to expiration).

 

The 600 call is $64.

 

Juicy premiums.

 

If I had unlimited capital I'd do a ratio spread...or simply short the 800 call and roll it forward for as long as necessary. But ... I don't.

 

This is a cringe-worthy newbie question, but who makes money by expanding the option chain? And is it riskless profit?

 

The exchanges that make money by charging a small fee on each trade make more money, because there are more trades.

[compoundinglife]

RH expanding limitations on share and option purchase limits: https://robinhood.com/us/en/support/articles/changes-due-to-recent-market-volatility/

 

50 names on their including GM and SBUX.

[aws]

It is impressive how they are holding the line at these inflated prices.  If the short interest is still 140%, then really there are 240% longs out there still holding with the stock 100x what it was a few months ago.  That's like $50 billion in long positions, and while a lot might have been purchased when leverage was cheap, everything has been marked up now so any leverage now is absurdly expensive.  I wouldn't have thought a squeeze could get so big and hold for more than a day, but it is so far.

[KCLarkin]

RH expanding limitations on share and option purchase limits: https://robinhood.com/us/en/support/articles/changes-due-to-recent-market-volatility/

 

50 names on their including GM and SBUX.

 

Am I reading this correctly? RH investors are only allowed to buy 1 share of Starbucks? Even after RH raised $1B plus drew down their credit lines. This is insane.

[Castanza]

RH expanding limitations on share and option purchase limits: https://robinhood.com/us/en/support/articles/changes-due-to-recent-market-volatility/

 

50 names on their including GM and SBUX.

 

Am I reading this correctly? RH investors are only allowed to buy 1 share of Starbucks? Even after RH raised $1B plus drew down their credit lines. This is insane.

 

I would like to see what’s in the closets....this doesn’t make sense unless you’re severely impaired no?

[compoundinglife]

RH expanding limitations on share and option purchase limits: https://robinhood.com/us/en/support/articles/changes-due-to-recent-market-volatility/

 

50 names on their including GM and SBUX.

 

Am I reading this correctly? RH investors are only allowed to buy 1 share of Starbucks? Even after RH raised $1B plus drew down their credit lines. This is insane.

 

Yeah, something is stinky there. Another interesting data point. Trade velocity relative to account size at RH vs other brokers:

 

https://pbs.twimg.com/media/Es5lsCXXUAINfx-.png

 

from:

 

 

 

I would like to see what’s in the closets....this doesn’t make sense unless you’re severely impaired no?