GameStop (GME) Hits over $150 a Share

Thought this might be interesting to talk about

Essentially the reddit group r/wallstreetbets has taken on some of the big fund managers

Anyone who is a international investor will know this is the biggest David v Goliath battle in ….well ever!

Literally one guy invested is up around the 22m (which hit 53m at the last opens high)

this is crazyyyyyyyyyyyy

Anyone got any thoughts?

Anyone else got rich from the madness?

For those who dont know this is essentially a dead company not to different to EB games here in Australia thats share price was $3 5 months ago and has rocketed to over $150 for pretty much no real reason other then a way for millennials to stick it to the rich pricks on wall street

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Comments

  • +2

    Google deleted 100,000 negative reviews of RobinHood.

  • +1

    I think this has the potential to hit $1,000 a share, that is if everyone holds!

    • +2

      Nah man, more. Probs $4k or $5k easy. $10k would be nice.

      Short sold shares has been more than total shares available. From what I've been reading shorts haven't covered their positions. If retail investors can buy and hold as many shares as they can this will go vertical. Literally a sellers market.

      It's beautiful.

      • +2

        $10K is not a meme

        • :โ€™)

  • +9

    From Sydney Morning Herald:

    One of Australiaโ€™s most revered investment houses sold a multi-million dollar position [last month]in the struggling US videogame retailer at the center of an international sharemarket frenzy this week, missing out on extraordinary gains triggered by a day trader revolt.

    Paradice would have netted between $US32 million to $US34 million ($44 million) for selling its stake last month, rather than $US885 million ($1.1 billion) if it had waited until this weekโ€™s peak, according to these numbers.

    • +1

      You are the Bloomberg Terminal of this thread, thanks for the nifty updates.

      (wonder if David still black textas his shoes…)

  • +8

    Elon Musk has tweeted about Cyberpunk 2077 to pump the price of CD Projekt, another Melvin Capital shorted stock. Melvin Capital had previously profited $25 mill on the launch failures and have a history of repeatedly shorting a stock into oblivion.

    Not mentioned by Elon, but Tesla have US$47 billion short interest, (not a short squeeze candidate though).

    • +6

      Also, Elon Musk hates Melvin Capital, since they were particularly active in shorting Tesla and spreading negative news about it last year.

      • +1

        He should change his Twitter bio to GME to make sure that MC get a proper face melting.

        • Lol. I like the idea.
          ๐Ÿš€ ๐Ÿš€ ๐Ÿš€

  • What is the fastest way for someone who has not traded any shares before to buy this share? I tried selfwealth and it takes time to set up the account.

    • IG was easy to set up and very quick

      • -1

        IG no longer accepting applications for share trading…

        • I made mine last night without any issues

    • I signed up today but there's up to 3 days for verification and/or funds.

      • Cheers for the heads up - what funding method did you use, out of interest? I was wondering how fast paypal is, I couldn't find an answer anywhere

        • I haven't deposited yet. Not sure how long each would take though. For verifying accounts it says

          "You can deposit now. Once you complete your profile we will verify your account and only then you will be able to start trading."

        • +1

          Debit card is the most reliable in terms of depositing and withdrawing. It is also instant.

      • Is that for everyone? Mine took less than a day to verify (I signed up few months ago).

        • It seems I was verified just now.

  • +3

    Asian billionaire Justin Sun is buying a million dollars worth on market open.

    • +3

      well i guess if you got a bn, 1million is like fun money

  • +1

    Just signed up to stake - my initial funding not there until Mon AM new york time, so aggess away. Ah well

    • +1

      Signed up to eTorro and my verification won't complete until 3 days lol

    • +1

      Just an FYI Stake has been near on useless since Wednesday. I've been completely unable to trade.

      • Damn, eTorro approved me in 3 hours. Can buy everything except AMC. But sell function on GME is disabled. Not sure if eTorro is fishy, but funds was instant with 28degrees in USD.

        Only things not sure of is withdrawal atm, but if all works, eTorro is so easy to use.

  • +6

    ๐Ÿ’ฃ ๐Ÿ’ฅ

    https://www.reuters.com/article/us-retail-trading-shortbets-...

    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.

  • +3

    534K wallstreetbets members online.
    1 million 20 minutes later.

  • +2

    Ah tonight is a spectacle, a spectacle of STAKE DYING IN THE ARSE.

  • where can I buy GME stock in australia?

    • +2

      Previous post https://www.ozbargain.com.au/node/600719?page=1#comment-1002...
      As mentioned it will take time to set up if you are new. eToro can be quick though which I have successfully used, you also get a nice referral bonus https://www.ozbargain.com.au/node/600604

      • thanks

        • IG setup was super quick

          • @tikei: How? Share trading temporarily unavailable!

            • @lnq: I made my account last night and had no issues :(

          • @tikei: If you are trading CFDs, the margin is now 100% for GME
            https://www.ig.com/au/shares/markets-shares/gamestop-corp-GM...

            • +1

              @lost00: Not planning on getting GME but this is shitty and market manipulation.
              "IG is not currently allowing any new positions to be opened on the US stocks GameStop and AMC Entertainment. Clients are still able to close existing positions."

              • @tikei: Yep cannot buy/sell anymore. WTF

                • +1

                  @lost00: Still able to buy on eToro (for now). They did briefly pause it before on Thursday but was fine on Friday so we'll see.

                  • @wangasm: Yeah you can buy, but sell function for GME looks disabled? No AMC atm, sigh, might need to find another player.

                    • @RocketSwitch: Probably need to wait for market open to sell. They did this before for Buy too.

                      • @wangasm: I see. It's odd how it's not disabled for NOK for example.

  • +2

    https://youtu.be/jg85H26wyLk

    Haha this was made 5 months ago on WSB worthwhile watching

  • -1

    I am surprised the short sellers haven't enterer the market at $320. The stock is not worth even $3.

    • +8

      Do you really think this hype was all about how much company is worth?
      This is not about how much is the company worth, it a proxy war b/w WSB & Wallstreet trying to make each other losers in the game.

      • -1

        But mah financial advisah!

    • +1

      If youโ€™re short, theoretically your losses can be infinite. If you go long, the share price will go to zero and you just lose the money. But thereโ€™s no limit on how high the share can go so shorting is far more risky.

      So the thing scaring short sellers off is that if they time it wrong, they canโ€™t hang on long enough and need to cover their short position and lose a ton of money.

      When share prices are moving based on business fundamentals, you can have more confidence about timing but even then itโ€™s anyoneโ€™s guess because the stock market doesnโ€™t behave rationally at the best of times. When the market is being driven by an army of Redditors who arenโ€™t investing on business fundamentals, then who knows how the share price will behave.

      Keep in mind shorting can play a positive role - it provides a check on fraud because companies which are misleading investors can get rooted out (see Blue Sky which was misleading investors big time). But it also is used as a tool to make hedge funds (and their investors) really wealthy.

    • +1

      A stock, like anything else, is worth whatever someone else will pay for it. The only fundamental that matters in a short squeeze is the most basic of Econ 101 fundamentals: supply and demand. When there's a supply shortage and a large demand, sellers become price setters - and when the buyers must buy no matter the cost, price elasticity goes out the window and the willingness of the market to pay a given price is irrelevant.

      Wall Street likes to pretend that the financial markets can ignore basic economics, but they really can't. They're really bound by the exact same fundamental rules as any other market, regardless of how much they'd like us to think only highly paid advisors and fund managers can understand it.

    • It's still like 100% short. either new short sellers came in or the old ones holding onto their guns.

  • How do you buy GME shares?

  • +2

    The only remarkable thing last night was how static the GME share price was the whole day and into the the afterhours. Given RobinHood was restricting buying to 2 and 1 shares, that's a bit of a win to the redditors. No significant after hours buying is interesting. Either Melvin Capital is waiting or they had closed out. I don't even rule out Citadel's Griffin quietly striking a deal with one of the large corporate holders of GME stock.

    The interesting bit of news is that Melvin Capital head Gabe Plotkin is a minor owner of the Charlotte Hornets, sold to him out of his own majority share by Michael Jordan. If Gabe has personal liabilities, yeah he might have to sell his part of the team, not the biggest deal. If Gabe Plotkin had previously been a star performer with 50% returns, Jordan is a megastar getting $100 million a year from the Jordan brand alone. Probably Michael Jordan was a major client of Melvin Capital and a fair whack of his money will have disappeared. Michael Jordan had owned 97% of the team and had no need to originally sell to Plotkin. He probably trusted Plotkin with his team after good performance managing his personal fortune.

  • Accredited investors pay big fees to hedge funds to profit of retail investors. The funds use their vast resources of data and personal to extract as much ๐Ÿ’ฒ as possible from the other party as they can. It's a game of ๐Ÿˆ and ๐Ÿ that has been going on for decades where the ๐Ÿ always get eaten.

    The tide may be turning now that people can see what social trading can do. Get enough people with a cause together and see them rekt everything in their path.

  • Can anyone explain why or link me an explanation for why brokerages like Robinhood, IB, etc prevented buying of GME stocks yet still allow selling? The most relevant explanation I've found so far is from Webull's CEO.

    But I'm still very confused so it would be great if someone could help and ELI5!
    1. Why does DTC require collateral when someone buys the stock? The buyer is already transferring DTC the money that's owed for that stock so what's the collateral for?
    2. Why did the brokers only restrict buys but not sells? Sure, the seller doesn't need to provide collateral but on the other side, the hedge funds are presumably buying that stock. Why is this asymmetry allowed? Because the hedge funds can afford the 100% collateral on their buy but the brokers can't?
    3. GME's market value isn't even that high. When Volkswagon's short squeeze made it briefly the most valuable company in the world, did this happen? What about when Tesla became the 7th most valuable company in the world last year while also being one of the most shorted? What distinguishes those from GME, AMC, etc?

    • -2

      Buy - stock price goes up
      Sell - stock price goes down
      Simple economies.

    • +2

      After further reading
      - https://www.reddit.com/r/wallstreetbets/comments/l7wvz1/why_...
      - https://twitter.com/KralcTrebor/status/1354952686165225478

      DTC has a historic clearing time of T+2 days. Might be related to why payment processors/bank transfers/etc can't clear immediately which I think is stupid in this day and age. When the buying broker/clearing firm pays money to buy stocks from the seller, the seller is exposed to risk for 2 days since they don't receive the funds for 2 days. The collateral helps balance out that risk so if for whatever reason RH's transfer failed to clear after 2 days, the collateral can be used to pay the seller.

      And for the 2nd part of my first question, for normal buys, there may be little risk since RH waits for their account user's funds to clear before allowing them to buy. But RH takes on risk when they allow their users to use leverage and I suppose that's the main risk that the collateral is meant to offset. That raises questions about why the collateral is required on all buys and not just option calls…

      • +3

        That's actually not true. Collatoralization at DTCC only covers clearing broker insolvency - it won't protect against individual trades falling to settle.

        The real issue is that DTCC has limits on Net Debit (buy side with no sell side) positions - capping out at $1.8bn: https://www.dtcclearning.com/products-and-services/settlemen...

        What this effectively means is that Robinhood was never capable of handling their customers buying without selling (or, as the industry calls it, value investing). They're practically insolvent already, by definition. The only thing that saves them is that Citadel executes like 40% of their order book without transmitting to the exchange.

        • Not sure I understand so can you break it down more?

          Collatoralization at DTCC only covers clearing broker insolvency - it won't protect against individual trades falling to settle.

          Are you saying that if the trade failed to settle, the broker would re-attempt the payment. But if they were insolvent and can't re-attempt the payment, that's when the collateral is used?

          A situation where the trade failed to settle is still vague to me. Do you have a concrete example? E.g. the user buys a stock with money transferred into RH but later on was able to trigger a bank transfer reversal? Or is it related to call options?

          The real issue is that DTCC has limits on Net Debit (buy side with no sell side) positions - capping out at $1.8bn

          What's the fundamental point here that makes it the real issue? Given that 100% collateral is required on buy orders, I can understand how that is a fundamental issue if RH doesn't have enough capital to provide it when purchasing on behalf of its users. Isn't the $1.8bn net debit a limit that isn't directly related to the above? i.e. It means that RH can only have $1.8bn of net buy orders awaiting settlement at any one time. And depending on what stocks are awaiting settlement, the collateral provided at that time can vary from $1.8bn * (3% to 100%).

  • +8

    We are witnessing history. I bought GME just to be a part of it. This is the real Occupy Wall Street.

  • Asking price is $5000 per share. Lol.

    • +3

      It is quite funny, people dividing by millionaire….but recently 140% of GME had been shorted. Insanity and obscene that brokers would reloan what they had lended. There might just be some very desperate buyers who would have to buy at that price. It's not just the shorters playing games. Brokerages have oversold GME and might be liable if their clients don't close. The fair value of GME is whatever will get shorters and brokerages out of their obligated mess.

  • +1

    ๐Ÿ’Ž๐Ÿ™Œ๐Ÿš€

  • Jordan Belforts take on it all:
    https://youtu.be/On4g1uj71zc
    Great interview.

  • +1

    https://youtu.be/0cv-i819cGEM

    I did an interview with my mate who runs a trading firm. Heโ€™s been flowing WSB for years and been keep up with the whole saga since its inception (May last year).

  • +1

    I just like the stock

  • +1

    Is the silver squeeze thing related to this craziness?

    • Yes but physical holders, not paper shares. e.g. PSLV not SLV.

      Paper shares are short 240%. The idea being, push the price of physical silver to squeeze the paper holders.

      The other stock is AMC.

  • stock up on silver, SLV and First Majestic to the ๐ŸŒ“

  • Reuters Emily Flitter and Katya Wachtel back in 2013.

    Stephen Cohen just bailed out Melvin Capital with US$750 million. Cohen is Gabe Plotnick's former boss and has only recently been able to supervise a fund after the insider trading charges at SAC.

    Citadel just bailed out Melvin Capital with $2 billion.

    "
    NEW YORK (Reuters 2013) - A former employee of SAC Capital Advisors' Chicago office was once part of an "insider trading group" at a rival hedge fund, according to an indictment filed on Thursday against SAC.

    A source familiar with the matter said the hedge fund was Citadel. A Citadel spokeswoman said there was no such "insider trading group" at the firm.

    Charges filed in U.S. District Court in New York on Thursday against prominent hedge fund manger Steven A. Cohen's SAC Capital said his former employee, Richard Lee, moved from a firm, identified only as "Hedge Fund A" to SAC, despite a warning that Lee "was known for being part of Hedge Fund A's 'insider trading group.'"

    The source familiar with the matter said "Hedge Fund A" is Citadel, the Chicago-based firm founded by Kenneth Griffin. Citadel managed roughly $13.3 billion at the end of 2012, according to a regulatory filing. Citadel was one of several hedge funds subpoenaed by federal authorities in 2010 as part of the government's broader insider trading investigation.
    "

  • +3

    ๐Ÿš€๐Ÿš€๐Ÿš€๐Ÿš€๐Ÿš€๐Ÿš€๐Ÿš€๐Ÿš€๐Ÿš€๐Ÿš€๐Ÿš€ $1000 here we come

  • I dnt get how GameStop was falling during a pandemic wtf

    here in EB games, you couldnt get your hands on a Ps4, Switch was sold out…wtf

    • +2

      Well, DFV said the same thing in August… I guess that's why he is $14M USD richer.

  • +1

    Wall Street Journal has a story that Melvin Capital lost 53% in January. That might equate to about US$7 billion.

  • +1

    The real squeeze is most likely happening sometime this week, most likely people should expect a big dip right before it as the funds try to ladder attack the price down to get paper hands to sell. But that fundamentals of the maths is that they are FORCED to buy, eventually, just no one really knows when. There IS a spike coming, but in the mean time, until it hits we're in for a hell of a ride. The more people that hold, the larger the spike. But of course you would expect some paper hands to fold early so it's hard to say how many will hold the line with this large of a rabble with many new 'investors' as well.

    We are in for a show. YOLO OR BUST!!

    • +1

      Diamond hands here Smol Cat :)

    • +1

      Hope you're right

    • Is the idea to sell at the spike? or hold until the hedge funds collapse?

  • GME pre-market is $365. Promising. It did drop sharply after opening on Friday, so we will see, but hopefully some entertainment tonight.

    • Ill be honest anyone buying at this level is probably going to get burnt hard

      If anything i reckon you got more chance waiting for the dip buying then selling on the same day but you got to have some balls of steel to do that

      • I just watched the original thesis video six months ago by Roaring Kitty. He was totally into just the fundamental value, said a squeeze was a possibility but not likely. He really did just like Gamestop as a value company. :) I really think this started completely innocently.

        (He also looks like the RobinHood CEO's twin.)

        • +1

          Gamestop at $2-10 was actually not a bad buy it still had a 5bn revenue its 'real' SP should be in the $15-30 i dont think anyone would of imagined what happened with GME

          God knows i wish i did!

          Good luck to the people that have got rich but i think nut jobs asking people asking 'how do i buy U.S shares?" so they can buy GME are going to get smoked

          • +2

            @Trying2SaveABuck: Yep. All the people on WSB saying they are proudly sinking $50K+ into it now might be the sign of the peak.

            Melvin Capital are telling every news outlet that will listen about their steady financial position. Down from $12.5 billion to $5 billion plus the new 2.75. They fib later about how understanding and loyal their investors are. Sure they are.

            I'm really disappointed with some of the low standards of journalism going on. CNBC cannot be trusted as a source yet ABC Australia and NY Post treat them as reputable. CNBC are the crazy Sky News of this story.

        • He's still holding a bag though and giving advice. The second he exits though it will come down in a spectacular fireball…

  • (From Daily Mail):

    "GameStop's largest individual shareholder, Ryan Cohen, has seen his 13 percent stake increase in value by more than $2 billion over the past two weeks. The co-founder of online pet supply retailer Chewy, who joined GameStop's board this month, originally paid about $76 million for the stake and has seen his net worth increase by about $6 million per hour over the past two weeks."

    This is lucky Phil…

    • +1

      I wouldnt be surprised if he has off loaded half a billion or so quietly

  • ABC:

    "Robinhood has tapped $US2.4 billion in funding on top of the $US1 billion it raised last week after the online brokerage's finances were strained due to a retail trading frenzy in heavily shorted shares of companies such as GameStop."

    Vlad Tenev denying a liquidity crisis days ago:

    https://m.youtube.com/watch?v=cuCcchMOsKE

    "No, there was no liquidity problem"

    • Which is pretty funny since a lot of market makers get away with naked shorting by claiming it was for liquidity reasons.

      Whenever there's a problem it's that darn liquidity!

      • I did read about that, market makers being allowed to naked short. Citadel Securities being a market maker and having poured $2 billion into Melvin and their problems starting to disappear.

        There's an interesting WSB theory about the large number of failed completions on GME. Will be interesting to watch that one develop. 5 million failed completions in the first half of Jan alone before WSB really took off. Rest of Jan numbers to be released Feb 17th :(.

  • -1

    Silver has rallied though

    • Nothing like % gains of GameStop.

      Looks like people who didn't get into GME AMC NOK BB want to be part of the action and will dump cash into whatever is mentioned on WSB.

      Not gonna end well. I do think silver was undervalued for a few years but never corrected , so assumed that was the true market value. Silver =\ gold.

      • One guy YOLO'd 80k on GME at $350 a share….

        Some idiots maxed there credit cards etc

        It already isnt ending well you got to laugh at how stupid some people are…

        It is unreal how many people think you just buy shares and Boom a week later you're rich…

        • $225 now.

          • @spedohero: Pre-market is negative another $35!!!

            People are going to lose there pants because they are idiots

            Well the market give and the market take away

            • @Trying2SaveABuck: Bloomberg:

              "Short interest in the video-game retailer plummeted to 39% of free-floating shares, from 114% in mid-January, according to IHS Markit Ltd. data. Data from S3 Partners, another market intelligence firm, showed a similar pattern, with GameStopโ€™s short sales having fallen to about 50% of its total stock available to trade, down from a high of roughly 140% reached earlier this year."

        • Some idiots maxed there credit cards etc

          Its very very concerning people on WSB are asking for examples of what Shorting is before or (sometimes) after they've purchased the shares.

          So all these descriptions about buying a GTA game, or buying bread and returning it were surfacing as analogies to market shorting

          • @frostman:

            If shares are in a margin account, they may be loaned to a short without the consent or knowledge of the account owner. If the shares are in a cash account, IRA account or are restricted shares they are not supposed to be borrowed unless there is express consent by the account owner.

            Also the fact that so many people got into RobinHood which by default sets your account as a margin account as well as providing trading metrics to the clearing houses and "brokers brokers", that should have set off alarm bells for people.

  • Stake - We have just received notification, our broker-dealer in the US, DriveWealth, will not be able to offer Buys on GameStop ($GME), AMC Entertainment ($AMC) and Nokia ($NOK) due to increased capital requirements set by the DTC.

    • What a shambles.

  • Glad Elon highlighted the fundamental issue in the Clubhouse call with Vlad - the sudden increase in collateral required from 3% to 100% by the NSCC and the opaque, "discretionary" nature of the formula that derives that requirement. Disheartening to see that WSB and the comments ignore it and go after the easiest target they see: RH.

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