Can you help me understand why this important. Seems like it means that there are people who have "sold" a bunch of stock to clients, but are actually in possession of those stocks and are now holding the short stick?
To short a stock, you "borrow" shares from the people who own them and pay interest on those shares, like a loan, but stock shares instead of money. You then sell those shares at the current price, and you will need to repurchase the shares later. (The assumption is, in the future stock price will be much lower, so it is worth paying interest in the meantime since you are selling at $5 but can buy the shares back later for $2 for example) The people who shorted game stop shorted so many shares that now, they have to buy back so many shares that the law of supply and demand, there is not enough supply of shares, so the price rises. Because they borrowed shares and are paying interest, they need to buy the shares NO MATTER THE PRICE. Since the risk is infinite as the price rises the brokers/creditors will force the short sellers to buy the stock no matter the price. Basically shorts getting fukt, so hard.
Best part is, Gamestop actually was fucked, but now with the stock price so high, they may be able to finance a real turnaround. And the worst of the wall street predatory gamblers eat it.
yeah it will be interesting to see how it plays out. I can't really see a scenario where this thing doesn't come falling back to the sub$40 range, plus an offering driving it back to the ground. I really wonder what this is like to watch from perspective of CEO/CFO, board members of a company when this speculation happens. I think I would be freaking out, idk. I trade, Can't imagine being responsible for a company on the verge of bankruptcy in a battle between wall street hedge funds and reddit autists.
Shorting = borrowing money and betting it on market price going down. 2x short means if price moves down 5%, you Can cash in 10%. 3xshort you get 15% fór 5% price decrease.
Short squeeze = bunch of people BET against a market and open short positions, but then players come and keep pushing the price Up, which means the traders with short positions are forced to close them at a loss And again if your open a 5x short f.e. but the price goes Up 10% leta say, now you loosing 50% of your position.
The short would have been already automatically closed long tíme ago by the exchange. For 2x short, it is liquidated if price goes Up 50%. 5x shorts are liquidated if price moves Up 20%
idk but gamestop like doubled in price.
Doubled? It’s up like, 800% for the month
I put a little bit in the inverse FANG fund. Just for the added joy of watching them crash and burn at some point.
Loving it!
I'm so enticed to short GME but I learned never to go against Elon. Dude can make anything turn into a rocket.
Can you help me understand why this important. Seems like it means that there are people who have "sold" a bunch of stock to clients, but are actually in possession of those stocks and are now holding the short stick?
To short a stock, you "borrow" shares from the people who own them and pay interest on those shares, like a loan, but stock shares instead of money. You then sell those shares at the current price, and you will need to repurchase the shares later. (The assumption is, in the future stock price will be much lower, so it is worth paying interest in the meantime since you are selling at $5 but can buy the shares back later for $2 for example) The people who shorted game stop shorted so many shares that now, they have to buy back so many shares that the law of supply and demand, there is not enough supply of shares, so the price rises. Because they borrowed shares and are paying interest, they need to buy the shares NO MATTER THE PRICE. Since the risk is infinite as the price rises the brokers/creditors will force the short sellers to buy the stock no matter the price. Basically shorts getting fukt, so hard.
::evil laugh:: I love it! THanks!
Best part is, Gamestop actually was fucked, but now with the stock price so high, they may be able to finance a real turnaround. And the worst of the wall street predatory gamblers eat it.
yeah it will be interesting to see how it plays out. I can't really see a scenario where this thing doesn't come falling back to the sub$40 range, plus an offering driving it back to the ground. I really wonder what this is like to watch from perspective of CEO/CFO, board members of a company when this speculation happens. I think I would be freaking out, idk. I trade, Can't imagine being responsible for a company on the verge of bankruptcy in a battle between wall street hedge funds and reddit autists.
Shorting = borrowing money and betting it on market price going down. 2x short means if price moves down 5%, you Can cash in 10%. 3xshort you get 15% fór 5% price decrease. Short squeeze = bunch of people BET against a market and open short positions, but then players come and keep pushing the price Up, which means the traders with short positions are forced to close them at a loss And again if your open a 5x short f.e. but the price goes Up 10% leta say, now you loosing 50% of your position.
The short would have been already automatically closed long tíme ago by the exchange. For 2x short, it is liquidated if price goes Up 50%. 5x shorts are liquidated if price moves Up 20%