Posted on 01/28/2021 1:50:14 PM PST by Brookhaven
Reports are coming in that Robinhood, the stock broker app, is forcibly selling shares of GameStop on behalf of some of its users. The transactions cannot be canceled and it is being positioned as mitigating “unreasonable risk” on behalf of the company as well as the investor.
Billionaire hedge funds have been taking a huge hit after a Reddit group started buying up GameStop shares in an effort to counter a massive amount of short positions. This prompted a “short squeeze” that sent the stock skyrocketing. As the dominos fell, GameStop reached a high of over $400 dollars per share, more than 10,000% higher than its low point earlier this year.
Now, it appears Robinhood and other brokers are cutting the losses of the billionaires by limiting the gains of small investors.
(Excerpt) Read more at noqreport.com ...
Correct, those that were manipulating the stock to begin with are those that win in the end.
It it’s legal, it’s in the fine print somewhere.
Worse, they are forceably selling the shareholder’s positions in GME.
Can you please keep us up to date on this? This kind of fraud hasn’t happened since 2008.
That's incredible! Having worked in a bank, I can't even imagine what would make them do this. Certainly their risk if they just let the positions alone is lower than if they sold people out forcibly. I wonder if they got a call from the SEC saying "hey it would be a shame if someone were to recharacterize your business of offering fractional shares as new securities offerings without a prospectus (i.e. totally unrelated activity) but by the way, have you noticed the action in GameStop"?
You can call a margin if you had a margin account. These positions are being closed in accounts where there is no margin account.
Also, margin calls require a trigger to prevent exactly this sort of thing from happening.
I saw a whistle blower comment that said that orders today were coming form as high as the White house itself. That is not hard for me to believe.
BTTP:
For too long, a small group in our nation’s capital has reaped the rewards of government, while the people have borne the cost. Washington flourished, but the people did not share in its wealth. Politicians prospered, but the jobs left and the factories closed. The establishment protected itself, but not the citizens of our country. Their victories have not been your victories. Their triumphs have not been your triumphs, and while they celebrated in our nation’s capital, there was little to celebrate for struggling families all across our land. That all changes, starting right here and right now, because this moment is your moment -— it belongs to you. It belongs to everyone gathered here today, and everyone watching, all across America. This is your day. This is your celebration, and this, the United States of America, is your country.
Donald J. Trump. January 2017
lol
This has the makings of a black swan event — not the short squeeze, but the reaction to it.
Gamestop is the most commonly mention stock, but i am trading Gamestop, Nokia, AMC, American airlines. Each of these stocks and others were halted today to allow the Market Makers and hedge funds to do their thing. Just wait until tomorrow on option expiration day, the piper will have to be paid or cheat more. hundreds of thousands of option contracts, each representing 100 shares will have to be closed out at massive losses to the Market Maker and their hedge fund backers. That is what this is all about. Google “Gamma Squeeze.” they did it to themselves.
Why would I have a margin call if my option was in the money?
I have no margin call. You have an incorrect understanding of what is going on.
What happened with Arthur Anderson was a farce.
They did nothing wrong.
DC is freaking out—the leftists have to “fix” everything immediately.
That is their weakness—we need to overload the “fix everything immediately” system—and they will melt down like the Wicked Witch of the West.
And that is just on Gamestop. there are dozens and dozens of stocks in EXACTLY the same position. entire option chains ITM. never happened before. The market makers don’t know how to get out. there are not enough shares to close out all their shorts. That is why they are reaching into customer accounts and taking them. gotta get them SOMEWHERE/ANYWHERE. deal with the law and the fines later.
Short sellers bet on the company/stock going down. The big hedge funds have made a cottage industry of shorting companies, then using their resources to trash them and profit off their shorts. It's how the Romneys of the world make money.
These Reddit people were stalking the HFs and buying the companies they were shorting and making the value go UP - crushing the HF bets and turning the tables on them.
I agree with you. Others are stating that the margin call contract is what is allowing Robin Hood to involuntarily sell shareholder positions.
I contend that is not the case. They’re just doing it.
You borrow it and immediately sell it at the current price. If the price goes down you buy it back at that lower price and return it and make a profit. If it goes up you also buy it back at the current price but take a loss.
Instead of buy then sell, it is sell then buy. If you buy and you are wrong the price of the stock can only go to zero, but if you sell short and you are wrong the price can theoretically go up forever. The squeeze is when all of the shorts are trying to buy at the same time, causing a feeding frenzy.
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