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LakerLanny
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Posted: Thu Jan 28, 2021 6:37 pm Post subject:

After all the shenanigans today...GME, BB and AMC are all up after hours. I really hope the small investors are at least allowed to buy the stocks they want to buy, blocking their access is really shady in my view and not playing fair. Why should institutional shorts be protected by the trading platforms while individual longs are banned or subject to completely different rules? Makes no sense at all to me and I hope for glory tomorrow and that the shorts get destroyed. _________________ Love, Laker Lanny

jonnybravo
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Posted: Thu Jan 28, 2021 6:41 pm Post subject:

I haven't chosen a brokerage yet but can someone tell me why Robin Hood specifically is at the heart of this madness? _________________ KOBE

kikanga
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Posted: Thu Jan 28, 2021 6:52 pm Post subject:

jonnybravo wrote:

I haven't chosen a brokerage yet but can someone tell me why Robin Hood specifically is at the heart of this madness?

I don't have the energy to do a rundown. Mhan and DB have some great breakdowns on Page 7 of this thread.

But in terms of the bolded. Go with Etrade. It's a no-brainer. What RH did isn't happening to Etrade. Etrade is a bank, and it's too big to buckle like RH did today.
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Last edited by kikanga on Thu Jan 28, 2021 6:53 pm; edited 1 time in total

LakerLanny
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Posted: Thu Jan 28, 2021 6:53 pm Post subject:

jonnybravo wrote:

I haven't chosen a brokerage yet but can someone tell me why Robin Hood specifically is at the heart of this madness?

A lot of the young investors who are following the Reddit short squeeze picks use Robinhood.

I find it outrageous what they did today to their customers and personally would never open an account with them. There are other no cost or low cost trading platforms.

Here is an article that may be of interest:

https://www.dailymail.co.uk/news/article-9197571/GameStop-rises-40-Robinhood-limits-buying.html
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Baron Von Humongous
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Posted: Thu Jan 28, 2021 6:55 pm Post subject:

Baron Von Humongous wrote:

LakesGnrLake wrote:

Baron Von Humongous wrote:

brb, gonna go invest my life savings into tulips and Hot Topic.

Update: reddit user 2ftd0nkeyd0ng2867 is telling us all to hold the line on HOTT

Update: reading about blockchain. Have you guys heard of this?

I'm hoping this funnels everyone to crypto and DeFi after this fiasco.

It's all a con game. The only way to win is to not play by their rules.

Update: my wife wants a divorce, but I'm sure this will blow over. I'll be posting from the La Quinta near the highway for a little bit.
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lakersken80
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Posted: Thu Jan 28, 2021 7:16 pm Post subject:

jonnybravo wrote:

I haven't chosen a brokerage yet but can someone tell me why Robin Hood specifically is at the heart of this madness?

Easy to use video game interface...appeals for young traders or people who have no idea how to play with stocks.

C M B
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Posted: Thu Jan 28, 2021 7:24 pm Post subject:

lakersken80 wrote:

jonnybravo wrote:

I haven't chosen a brokerage yet but can someone tell me why Robin Hood specifically is at the heart of this madness?

Easy to use video game interface...appeals for young traders or people who have no idea how to play with stocks.

Also free, mobile, partial shares, etc. A dollar, two taps and a swipe, and little Timmy Fortniter is playing the stock market like it's some big joke. This is probably the last time I will ever do anything outside of vanguard or my advisor.
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Last edited by C M B on Thu Jan 28, 2021 7:52 pm; edited 1 time in total

Baron Von Humongous
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Posted: Thu Jan 28, 2021 7:26 pm Post subject:

lakersken80 wrote:

jonnybravo wrote:

I haven't chosen a brokerage yet but can someone tell me why Robin Hood specifically is at the heart of this madness?

Easy to use video game interface...appeals for young traders or people who have no idea how to play with stocks.

RH also has ads on every podcast in existence.
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jonnybravo
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Posted: Thu Jan 28, 2021 7:44 pm Post subject:

Thanks for the tips guys. I'm leaning towards Fidelity or Etrade. _________________ KOBE

Baron Von Humongous
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Posted: Thu Jan 28, 2021 7:56 pm Post subject:

LakerLanny wrote:

After all the shenanigans today...GME, BB and AMC are all up after hours.

I really hope the small investors are at least allowed to buy the stocks they want to buy, blocking their access is really shady in my view and not playing fair.

Why should institutional shorts be protected by the trading platforms while individual longs are banned or subject to completely different rules?

Makes no sense at all to me and I hope for glory tomorrow and that the shorts get destroyed.

Two trading apps blocked purchasing access for a few hours as far as I can tell - Robinhood and Webull. Were there more?
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Baron Von Humongous
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Posted: Thu Jan 28, 2021 8:09 pm Post subject:

DancingBarry wrote:

trmiv wrote:

Baron Von Humongous wrote:

trmiv wrote:

Rich people for years: “poor people need to pull themselves up by their bootstraps and invest their money instead of spending it on Xboxes, smartphones and alcohol.”

Poor people: “ok, money invested”

Rich people: “wait.....no.....not like that”

https://www.vice.com/amp/en/article/y3gepx/investment-firms-are-the-big-winners-of-the-gamestop-stock-revolution-so-far

Oh I’m sure they are making a lot of money, they always make money, just like casinos (ones not owned by Trump). However, they are pissed that the poors are making money too.

Actually, I don't think a lot of these are pissed at all. They own massive long positions of these stocks in their funds. Their AUM goes up as a result. They can probably dump some of these dogs and reallocate that to other stocks. Those (even some of these same poors) who invest in their funds and own a few shares will do well.

But bigger picture, having more average dudes or young people showing more interest in investing is only a good thing for them. They'd love for people to set aside some money into their funds so they can make a % of that. Having people interested and active is gold for most of the accessible investment firms.

Certainly a lot of people are going to get burned. If not now, maybe later. But on the optimistic side, if average dudes start educating themselves it really could be good for a lot of young people if they are putting money away now and thinking about investing for the future.

There're solid returns to he made in retail trading that don't involve chasing the tail of pump and dump schemes. Hopefully new investors learn that.
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Last edited by Baron Von Humongous on Thu Jan 28, 2021 8:21 pm; edited 1 time in total

LakerLanny
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Posted: Thu Jan 28, 2021 8:10 pm Post subject:

Baron Von Humongous wrote:

LakerLanny wrote:

Two trading apps blocked purchasing access for a few hours as far as I can tell - Robinhood and Webull. Were there more?

My understanding is that E Trade and Interactive Brokers also restricted GME trades today. I have Schwab and they did not restrict buying the stock, however they did up the margin requirements and such on the stock which I guess I am ok with.

But to not allow people to buy the stock (and several other stocks) at all when they want to? That is pretty much unprecedented and reeks of collusion.
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Baron Von Humongous
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Posted: Thu Jan 28, 2021 8:20 pm Post subject:

LakerLanny wrote:

Baron Von Humongous wrote:

LakerLanny wrote:

Two trading apps blocked purchasing access for a few hours as far as I can tell - Robinhood and Webull. Were there more?

Thanks for the response. An SEC investigation seems warranted just in case, but do you buy the statements from these trading apps that they blocked purchases for a few hours due to insufficient liquidity? Or do you think it was done solely to protect hedge fund investors?
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eddiejonze
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Posted: Thu Jan 28, 2021 8:35 pm Post subject:

Futures are down _________________ Creatures crawl in search of blood, To terrorize y'alls neighborhood.

kikanga
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Location: La La Land

Posted: Thu Jan 28, 2021 8:47 pm Post subject:

Baron Von Humongous wrote:

LakerLanny wrote:

I have Etrade. And wasn't restricted. But I do have a decent amount of $ in my account. And I didn't leverage. So that may be why.
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DancingBarry
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Posted: Thu Jan 28, 2021 8:59 pm Post subject:

jonnybravo wrote:

I haven't chosen a brokerage yet but can someone tell me why Robin Hood specifically is at the heart of this madness?

So as the name implies, they wanted to disrupt the trading market. I believe they were the first to offer free trades. Then I think Schwab followed and then it forced the hand of everyone else. They also targeted the young crowd with their commercials and kind of poking fun at older traders and the services they used. They positioned themselves well. Things really took off for them early in 2020. They were adding millions of accounts as people were flocking to get into trading (especially with no sports gambling or entertainment going on). Now you get to this week with some revolutionary trading by hundreds of thousands of folks who were in on these squeeze plays. It's like david vs. goliath. It's like the poor taking it to the rich, like Robin Hood.

And then Robin Hood sold out today. They stopped allowing people to play the same way the big hedge fund traders were playing. The traders weren't allowed to buy certain stocks to keep the pressure on the squeeze. Some folks panicked, the stock went down, some big players were able to short the stock again just before this announcement. It was seen as a total betrayal to everything they stood for and a lot of these activist retail trader types who hooked on with them. Just a total disaster in terms of their brand image.

Honestly, there were some signs before this. Robin Hood used to allow people to see the number of accounts holding certain funds. There was a site last year called Robin Track that used this open source data to build some basic, but cool tracking info. Robin Hood didn't like how traders were starting to use that and shut down the free flow of this info. So things that were making them a little unique are no longer.

They've really lost sight of what differentiated them. Wish I was doing advertising for a competing platform right now. You can target people who have specific apps on their phones like Robinhood or receive emails from them. I'd be going hard right now at those audiences, spending a few million in the next several days to pull those account holders. They'll be fine, but I'll be curious to see the numbers that leave them after the millions of traders they added in the past year.

Baron Von Humongous
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Posted: Thu Jan 28, 2021 9:40 pm Post subject:

The guy who turned $53K of GameStop stock into $50M worked for Mass Mutual: Reuters _________________ Under New Management

jonnybravo
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Posted: Thu Jan 28, 2021 10:58 pm Post subject:

DancingBarry wrote:

jonnybravo wrote:

I haven't chosen a brokerage yet but can someone tell me why Robin Hood specifically is at the heart of this madness?

Thanks for the recap DB. Just reading up in detail on today's shenanigans. Wow. What a bunch of pos'. If I were on the wrong end of it, I'd want to organize a lynch mob.
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kikanga
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Posted: Thu Jan 28, 2021 11:31 pm Post subject:

Wow.

https://robinhood.com/us/en/support/articles/changes-due-to-recent-market-volatility/

Quote:

Yes. The table below shows the maximum number of shares and options contracts to which you can increase your positions. Please note that these are aggregate limits for each security and not per-order limits, and include shares and options contracts that you already hold. These limits may be subject to change throughout the day.

Symbol / Shares / Options contracts
AAL ----- 55 ----- 50
AMC ----- 115 -----100
BB ----- 65 ----- 100
BBBY ----- 30 ----- 50
CTRM ----- 1650 ----- N/A
EXPR ----- 200 ----- 100
GME ----- 5 ----- 10
KOSS ----- 25 ----- N/A
NAKD ----- 750 ----- N/A
NOK ----- 110 ----- 100
SNDL ----- 1200 ----- 100
TR ----- 25 ----- 50
TRVG ----- 400 ----- 100

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DuncanIdaho
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Joined: 26 Apr 2004
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Location: In a no-ship

Posted: Thu Jan 28, 2021 11:39 pm Post subject:

Quote:

Losses on short positions in U.S. firms top $70 billion - Ortex data

LONDON (Reuters) - Short-sellers are sitting on estimated losses of $70.87 billion from their short positions in U.S. companies so far this year, data from financial data analytics firm Ortex showed on Thursday.

The hefty losses come as shares of highly-shorted GameStop jumped more than 1,000% in the past week without a clear business reason, forcing short-sellers to buy back into the stock to cover potential losses -- defined as a short-squeeze -- while retail investors then piled in to benefit from the surge.

https://www.reuters.com/article/us-retail-trading-shortbets-idUSKBN29X1SW?taid=6012f37e9ac87d000147d4e3

kikanga
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Posted: Fri Jan 29, 2021 6:52 am Post subject:

Damn. I should've bought on the closing dip yesterday. Well that's my bad. I knew it was gonna rebound eventually. _________________ "Every hurt is a lesson, and every lesson makes you better”

Baron Von Humongous
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Posted: Fri Jan 29, 2021 7:55 am Post subject:

Really looking forward to shorting this bubble. _________________ Under New Management

Baron Von Humongous
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Posted: Fri Jan 29, 2021 9:51 am Post subject:

Baron Von Humongous wrote:

LakesGnrLake wrote:

Baron Von Humongous wrote:

brb, gonna go invest my life savings into tulips and Hot Topic.

Update: reddit user 2ftd0nkeyd0ng2867 is telling us all to hold the line on HOTT

Update: reading about blockchain. Have you guys heard of this?

I'm hoping this funnels everyone to crypto and DeFi after this fiasco.

It's all a con game. The only way to win is to not play by their rules.

Update: my wife wants a divorce, but I'm sure this will blow over. I'll be posting from the La Quinta near the highway for a little bit.

Update: working with some new online friends I made on 8chan to pool our dogecoin and buy options on Build-A-Bear Workshop, Inc. You guys should jump in so we can squeeze the new Porsches out of these HF fat cats.
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lakersken80
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Posted: Fri Jan 29, 2021 10:24 am Post subject:

Good day to get some discounts.

angrypuppy
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Posted: Fri Jan 29, 2021 11:04 am Post subject:

Baron Von Humongous wrote:

trmiv wrote:

Baron Von Humongous wrote:

trmiv wrote:

https://www.vice.com/amp/en/article/y3gepx/investment-firms-are-the-big-winners-of-the-gamestop-stock-revolution-so-far

Oh I’m sure they are making a lot of money, they always make money, just like casinos (ones not owned by Trump). However, they are pissed that the poors are making money too.

Quote:

Steven I. Weiss
@steveniweiss
One of the more funny/sad/tragic parts of this GameStop activity is the misplaced sense of populism.

People really think they're busting Wall Street, and sticking it to The Man.

No. Wall Street is profiting immensely, and the Man is getting much richer, thanks to you.

There are a few key myths that add up to this misplaced populism:
- That Wall Street has a position on GameStop
- That it makes or loses money based on positions
- That regular folk are trading truly commission-free
- That regular folks have access to the same trading tools

Myth 1: Wall Street had a Short Position on GameStop

No, some hedge funds had a short position on GameStop, but Wall Street as a whole had relatively little invested in the company, either way. And when one hedge fund gets its positions blown up, other hedgies profit.

In particular, here, Melvin Capital got its positions blown up. Melvin Capital is a tiny player in the scope of Wall Street overall. It has a couple dozen employees and managed $7b. You know who profits when it gets in trouble? People with even more money under management. In the case of Melvin Capital, billionaires Ken Griffin and Steve Cohen bought into the fund this week, in what were assuredly fire-sale prices. So, a $7b, 30-employee entity got into trouble, and two men worth $35b profited by getting to buy a chunk of it for cheap.

Populism!

Myth 2: Wall Street Is Losing Money On This

Even setting aside the outcome of Myth 1, where some rich guys lost money so that even richer guys could make more, the whole idea that Wall Street makes or loses money based on a specific bet is misplaced.

Wall Street is the casino. Wall Street makes money when people trade stocks. Until a few years ago, retail investors saw this through commissions on trades. Now they trade "commission free" through Robinhood & etc., but they're still paying a price. The price is just hidden a bit from the public.

The Wall Street model is built on making money off of every trade. Just because they don't charge explicit commissions, doesn't mean they gave up on that model. Wall Street just switched the model to charge investors a different way. A lot of people might wonder how Robinhood makes money, if it isn't charging commissions. The answer is that, fundamentally, it's charging you more when you buy a share of stock, and giving you less when you sell a share.

It's a little bit more involved than that. I'll explain. One of the major ways of making money these days is through High-Frequency Trading. Computer programs that can trade stocks at very high speeds, exploit tiny differences in price over tiny periods of time -- fractions of a penny in micro-seconds. It adds up to a lot of money. Those computer programs exploit the fact that you don't actually care about paying a few pennies different for your shares, or selling for slightly lower price. Robinhood sells the information about what you're willing to pay to funds that trade in the middle. You pay more.

So, we've established that Wall Street is built on a model of charging for every trade, even when it's not charging an explicit commission. So when does Wall Street make the most money? When the volume of trading is up. And the GameStop moves have generated historic volumes. GameStop options on Tuesday generated more trading activity than any other stock's options, on any other day, in history. Literally historic profits being minted on Wall Street, right now, over these GameStop moves.

Populism!

Myth 4: Regular Folks Have Access to the Same Trading Tools as Wall Street.

Not by a mile. This was one of the more hilarious claims made by @chamath on CNBC the other day, talking about how retail investors have access to "the same compute power as the best hedge fund." Nope. When hedge funds engage in algorithmic trading (the only kind of trading where "compute power" really matters), they have better tools. These include:

- Physical proximity. Their servers are parked at the exchanges, to give their algorithms a data feed that's updated faster.

- Economies of scale. They buy their hardware directly and host it at their own expense. Try to buy the same compute power from Google, and you'll be paying a retail markup.

- Proprietary data streams. They pay for heavily-machined data that is proven to provide a trading signal And so, whereas a lot of people, including some of the wealthiest folks in the world, seem to think this is the wisdom and power of decentralization winning in a crowd-sourced, Internet-based revolution...

No. The hedge funds are still minting, still more powerful.

Populism!

Myth 5: This Ends With Regular Folks Making Money

Sure, maybe, it could've been so, if this had stopped when GameStop was around $20/share. But it's now traded to well more than 20x what even the most optimistic person genuinely thinks it's worth. This doesn't end well for folks It's hard to say exactly how much money retail investors have on the line right now. Through a mix of different kinds of contracts and purchases, they've bid up a company's paper value to (depending on the minute) 3-6x more than any rational person thinks it's worth.Is it billions of dollars of retail investors' money tied up in the idea of GameStop being worth several times more than anyone thinks it is?

I'd guess it's billions, given the mix of the market cap, plus the extremely high volumes of trading, and anecdotes. People bought this.It inflates people's portfolios on paper for a while.

A week? A month? Hard to say.

But at some point, someone's going to pay for the difference between its valuation at peak, ~$25b, and what the most optimist think it's worth, ~$6b. And retail investors will be the ones paying. Wall Street makes money on the way up, and Wall Street makes money on the way down.

But individual people are going to lose, and lose big, because they're walking around paying hundreds of dollars for pieces of paper no one really believes are worth more than $20. Retail investors will be the ones left holding the bag, as it deflates from $25 billion, to $6 billion or less, and Wall Street will have historic profits.

Populism!

Thread: https://twitter.com/steveniweiss/status/1354827133852528647

I wasn't following the story, I'm an index fund guy... but what the author is saying is that the general public has a very fuzzy understanding about "Wall Street". Wall Street is consists of many players with different goals, and they do sometimes align themselves to (bleep) others.

From what I can see, if GameStop was any more of a dog it would shed hair. But the market makers don't (and shouldn't) care, they're in the business of matching orders and making some side bets (directly or indirectly) based on the market depth (buy and sell limit orders that haven't hit the market-clearing price). When orders keep coming in from retail, some orders execute, but the liquidity starts to dry up as anyone with a sell limit order my pull their order and reset at a higher price. And so on.

How can this hammer a hedge fund? A hedge fund could take a direct position, but they probably won't bother. It's messy, and unloading the stock later means breaking up a gigantic position into a series of semi-gigantic blocks. Those blocks are frequently traded among institutional traders, buying and selling blocks involve a premium or discount due to their size. But hedge funds might find that messy and instead use a synthetic security to short aka a put derivative. If you're leveraged to the hilt on the actual security, you need to cover (pay money to keep the position). If you're in a derivative, you might start (bleep) in your pants. Either way, your analysts probably told you GameStop or whatever is really worth $X, and yet the great unwashed from Reddit have pushed it up to some crazy level, a multiple of $X. In the long run the hedge fund might be right, but that's not the way derivatives or margin works. Margin calls mean lots of money in. Derivatives (which is probably by and large the case here) all have expiration dates. Even if GameStop is worth, say $40 in the long-run, the expiration date on that derivative position might be next week, or in two or three weeks. The "long run" doesn't necessarily apply.

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