Investing General Discussion

Blazin

Blazin

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TJT said:
What kind of rule changes would there be?
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Rules for the market makers, it's complicated but they are having to buy millions of shares to cover those calls knowing full well nobody is actually going to be buying the equity at exp. Or you up the account minimum to be buying calls, to limit buying power. They could make a liquidity rule, if you buy 1000 calls with a $50 strike for $1, you spent $100,000 to place a contract on $5M in equity, they can easily limit this by saying you must have 10-20% of that in available buying buyer to enter the position. To have the least effect on normal market operations they could make that rule only apply to positions over a certain size so when people are doing the normal buying of 1-5 contracts they wouldn't be affected.
 
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Fogel

Fogel

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Blazin said:
Rules for the market makers, it's complicated but they are having to buy millions of shares to cover those calls knowing full well nobody is actually going to be buying the equity at exp. Or you up the account minimum to be buying calls, to limit buying power. They could make a liquidity rule, if you buy 1000 calls with a $50 strike for $1, you spent $100,000 to place a contract on $5M in equity, they can easily limit this by saying you must have 10-20% of that in available buying buyer to enter the position. To have the least effect on normal market operations they could make that rule only apply to positions over a certain size so when people are doing the normal buying of 1-5 contracts they wouldn't be affected.
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I was reading about this after you posted about it earlier. Aren't the market makers just buying shares to hedge against the options they're selling?
 
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Tide27

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Can someone shed some light into the GME rocketship of late?

It wasn't long ago the stock was $2.47. All major console makers are going basically all digital, so the resell market won't be there much longer and they announced they are closing 1000+ stores.

Their entire profit was derived from buying and selling old games, which seems to be a dying market. So now basically it's a comic book shop of random Funko toys and action figures.

I dont get it.
 
Blazin

Blazin

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Fogel said:
I was reading about this after you posted about it earlier. Aren't the market makers just buying shares to hedge against the options they're selling?
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That's exactly what they are doing, and you have retail traders buying $100k-300k of call options each, triggering the buying of tens of millions of shares of equity into in illiquid tape. This drives the stock up which triggers more call buying which triggers more share buying...The market maker has a contract requiring them to provide some degree of liquidity to these trades, they should have the power in these circumstances to simply refuse to take the other side of the call buy.
 
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Blazin

Blazin

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Tide27 said:
Can someone shed some light into the GME rocketship of late?

It wasn't long ago the stock was $2.47. All major console makers are going basically all digital, so the resell market won't be there much longer and they announced they are closing 1000+ stores.

Their entire profit was derived from buying and selling old games, which seems to be a dying market. So now basically it's a comic book shop of random Funko toys and action figures.

I dont get it.
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The move has nothing to do with the company, they could be a lemonade stand, it's gone viral nobody participating cares one hoot about Gamestop, so I wouldn't waste anytime trying to have it make sense in that context. They are interested because they have the short side trapped.
 
Fogel

Fogel

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Tide27 said:
Can someone shed some light into the GME rocketship of late?

It wasn't long ago the stock was $2.47. All major console makers are going basically all digital, so the resell market won't be there much longer and they announced they are closing 1000+ stores.

Their entire profit was derived from buying and selling old games, which seems to be a dying market. So now basically it's a comic book shop of random Funko toys and action figures.

I dont get it.
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Read the last 3-4 pages of this thread
 
Borzak

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Big Phoenix said:
R2qFh.gif


Jesus fucking christ. Some people are about to get fucked in the ass and some about to have the happiest day of their lives.

Also what the hell is continuing to fuel this?
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People betting for or against how stupid people can be fueled by the internet.
 
Hateyou

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Tide27 said:
Can someone shed some light into the GME rocketship of late?

It wasn't long ago the stock was $2.47. All major console makers are going basically all digital, so the resell market won't be there much longer and they announced they are closing 1000+ stores.

Their entire profit was derived from buying and selling old games, which seems to be a dying market. So now basically it's a comic book shop of random Funko toys and action figures.

I dont get it.
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It’s people manipulating the market via Mass coordination on Reddit. GameStop just happened to be the one they picked to do it.
 
LachiusTZ

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Blazin said:
That's exactly what they are doing, and you have retail traders buying $100k-300k of call options each, triggering the buying of tens of millions of shares of equity into in illiquid tape. This drives the stock up which triggers more call buying which triggers more share buying...The market maker has a contract requiring them to provide some degree of liquidity to these trades, they should have the power in these circumstances to simply refuse to take the other side of the call buy.
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So they would post the option, then refuse to fill it?

Because you are jelly of monster returns a bunch of "non appointed" (which for you is poor and not "savvy)?

Lol fuck that, this shit is beautiful
 
Blazin

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LachiusTZ said:
So they would post the option, then refuse to fill it?

Because you are jelly of monster returns a bunch of "non appointed" (which for you is poor and not "savvy)?

Lol fuck that, this shit is beautiful
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Based on that response I don't think you understand how it works nor what I'm saying about it.
 
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Araysar

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my portfolio is up 12% this morning on the backs of CCIV and ZNTE

this is crazy, markets havent opened yet, its all pre-market
 
Fogel

Fogel

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LachiusTZ said:
So they would post the option, then refuse to fill it?

Because you are jelly of monster returns a bunch of "non appointed" (which for you is poor and not "savvy)?

Lol fuck that, this shit is beautiful
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What he is saying is that if someone buys a GME call for 10000 shares expiring 3/1/21, the market maker then buys GME shares right away to hedge against the option he just sold, even though technically the shares aren't needed until march. This then triggers a feedback loop since the shares being bought causes the stock price to rise, triggering a bullish signal which causes more people to buy more calls, rinse repeat.

The change he's proposing is making it so the market maker can defer buying the shares until if they're needed for the March expiry.
 
LachiusTZ

LachiusTZ

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Fogel said:
What he is saying is that if someone buys a GME call for 10000 shares expiring 3/1/21, the market maker then buys GME shares right away to hedge against the option he just sold, even though technically the shares aren't needed until march. This then triggers a feedback loop since the shares being bought causes the stock price to rise, triggering a bullish signal which causes more people to buy more calls, rinse repeat.

The change he's proposing is making it so the market maker can defer buying the shares until if they're needed for the March expiry.
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I know exactly what he was saying.

The word he used was refuse.

Instead of people learning how to handle a situation, he is wanting to change the nature of it to benefit giant financial players from a bunch of trolls.

Fuck that, it's amazing to watch.

Edit: the difference between refuse and defer is pretty large in this, is it not?
 
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Blazin

Blazin

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LachiusTZ said:
Hater.
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To clarify for you, the market maker won't be hurt this is just math to them. The people you think are making out are the ones who are going to get hurt. None of the gains you are seeing are real yet until they sell. Some will actually get out and make bank the vast majority of them will not. It's an impossibility. Nobody is going to hold the equity at these levels, people are jerking off over paper gains that will not survive. The first few out the door will make bank, the massive hoard will get slaughtered. It's basic supply/demand and it's inevitable.
 
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Blazin

Blazin

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LachiusTZ said:
I know exactly what he was saying.

The word he used was refuse.

Instead of people learning how to handle a situation, he is wanting to change the nature of it to benefit giant financial players from a bunch of trolls.

Fuck that, it's amazing to watch.

Edit: the difference between refuse and defer is pretty large in this, is it not?
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No you don't get it, Jesus. Please just stop talking about it, your hurting my head trying to figure out how you think that makes sense. You are 100% wrong which is good news because its not far off from being right just start thinking the exact opposite and you're there.
 
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