Earlier quoted context omitted.
I don’t know how you could possibly reason about options without understanding delta, and gamma makes sense to me too since it’s just the derivative of delta as the underlying value changes.
As a math person, I’ve never heard “gamma” to mean the derivative of a change (a delta). For example, I was always taught that speed is v=delta-x/delta-t (distance over time). I’ve never heard gamma to mean that.
Statement of SEC Regarding Recent Market Volatility
741–750 of 906 posts
Re: Statement of SEC Regarding Recent Market Volatility
#742Earlier quoted context omitted.
I am so sick of this 'stay in your lane' attitude. Time and time again, experts have been shown to have consensus opinions which are wildly off from reality. You can almost set your watch to how often an outsider will analyse a situation from first principles and make money off the 'experts', especially in the stock market. You're welcome to your opinion but this appeal to authority is seriously wearing thin. Pretty…
Haha, of course you're The Type of Guy who worships Wolfram. You know he's a total crank right.
Personal attacks are not cool here regardless of how wrong another comment is or how much you disagree with someone.
Re: Statement of SEC Regarding Recent Market Volatility
#743Earlier quoted context omitted.
The FOMO is palpable. There's a hurried rush of small investors hoping to turn their meagre savings into a big win, backed by the anxiety that if they don't try then they'll forever regret missing their one and only chance at a comfortable life. This sort of event would be less likely if America's wealth disparity weren't so grotesquely skewed.
Everything on WSB states this is a bad investment plan and is more to bankrupt Melvin because they tried to bankrupt Gamestop. Short sellers have been using the down turned economy to collapse struggling companies that hire everyday people. What's funny is how the HN community tries to defend the firms they've whined about for years. Is what's going on irrational? Yup. But it pulls back the curtain of what the financ…
According to the best evidence, Melvin has no short position (they may even actually be long now). So the entire WSB narrative is a lie being used to pump up the stock. The subtleties matter here.
Re: Statement of SEC Regarding Recent Market Volatility
#744Earlier quoted context omitted.
I am so sick of this 'stay in your lane' attitude. Time and time again, experts have been shown to have consensus opinions which are wildly off from reality. You can almost set your watch to how often an outsider will analyse a situation from first principles and make money off the 'experts', especially in the stock market. You're welcome to your opinion but this appeal to authority is seriously wearing thin. Pretty…
> I am so sick of this 'stay in your lane' attitude. Is that you, Michael Gove. > You're welcome to your opinion but this appeal to authority is seriously wearing thin. It is you, Michael Gove. > Progress almost always comes from non-consensus outsiders. Certainly the spread of COVID19 in the UK and US is evidence that something can spread with the encouragement of "non-consensus outsiders".
Please do not post in the flamewar style to HN, regardless of how wrong a comment is or you feel it is. We're trying for something different here.
Re: Statement of SEC Regarding Recent Market Volatility
#745Earlier quoted context omitted.
Not an expert myself, but I've been interested in the field for a while. The clearinghouse ultimately moves the security and money to their right place, and allows brokerages to let each side move on faith that everything will be right once the dust settles. On settlement risk, a key point is that there usually isn't a huge amount of risk. This is why DTCC is nearly imperceptible for retail players. In this case, the…
Speaking as a long term value investor who is mostly noshing po'corn and watching, I have a couple of questions: Don't the settlement worries provide evidence of naked shorts? (Naked shorts being selling a share without being sure the share would be available at settlement? And naked shorts illegal?) Wouldn't the normal procedure be to halt all trading until the issues had cleared up? As opposed to allowing positions…
Naked shorts are not impossible, especially if you're talking about naked call options. They're comparatively rare (being illegal just means you get fined if you get caught, it's really "not that serious" for a big player), and small timers aren't allowed to participate, but they're not impossible. An even bigger point than that is that the short doesn't necessarily have to be naked in the legal sense for you to fail to deliver, especially when a security has gone completely Texas like GME has.
This situation is rare. Halting all trades is very scary for all parties involved. It's way worse for just about everybody than asking brokerages to have 100% collateral is.
Re: Statement of SEC Regarding Recent Market Volatility
#746A Moment in the Life of an HN Genius: 1. Reads a technical document outside their domain. 2. Feels dumb because they don't have a grasp on any of the concepts. 3. Too busy to use the very internet which some of them probably helped build to magically render learning materials to the screen in front of them at zero marginal cost. 4. Sees the word "manipulation" 5. Substitutes the laymen's definition of "manipulation"…
Seems like you struck a nerve. I'm impressed by how many people are replying to this, quoting your points, and then talking about those points as if they were addressed directly at them. When did HN become overrun by narcissists?
Please don't do psychological mass-diagnosis of large internet communities, including HN, in HN comments. Those are always an invention because there isn't nearly enough data to assess anything like that.
Meanwhile, when you do this (I don't mean you personally), it's always to bash the other side of some $issue, which is just the sort of flamebait and provocation we're asking people to avoid here—regardless of how wrong other people are or you feel they are.
Re: Statement of SEC Regarding Recent Market Volatility
#747Earlier quoted context omitted.
And what about all the people who watch MSNBC and CNBC and Cramer, do they need to stop pushing stops as good or bad too? They tell lots of people "who don't care about hedge funds or any of that, but just got the impression from the news that hey this stock is going way up and that must mean it is a way to make a quick buck" too. None of this could have happened if they weren't shorting GME at 143%+ of float. They w…
We let big players partake in risky things like shorting GME above 100% float because we don't care if they lose. It's the same reason we allow them to invest in companies like Theranos. They know the risks they were getting into and will still be fine without a extra 0 in their bank account. Regular followers of WSB are aware of the risks as well, so I'm fine with them attempting a short squeeze. The problem is that…
Except hedgefunds only trade money from accredited investors, i.e. people who can afford to lose a lot of money. They also typically aren't swayed by TikTok videos and short explainers of how shorts work designed to hype up GSE. The point is that Robinhood investors are being exploited.
Re: Statement of SEC Regarding Recent Market Volatility
#748Earlier quoted context omitted.
Why would shorting Gamestop mean making it to go bankrupt? The falling stock price of a company doesn't cause a company to go bankrupt, the causality is in the other direction. Putting downward pressure on price is useful only if you want to do a hostile takeover.
I think focusing on how it hurt GameStop isn’t the right perspective here. I think it’s more about how greedy and over-leveraged the short holders were. When average Joe goes crazy over-leveraged, the entire world says “well duhh, you took a risk and now you have to pay.” But when a hedge fund does it, they get to just make a call to turn the market off for a few hours and try to bail out their shorts? The hypocrisy…
"Over leveraged" typically means you traded too much on credit in proportion to how much collateral you have, not that the trade is risky. A very large short position is reasonable for a company that is likely to go out of business.
Re: Statement of SEC Regarding Recent Market Volatility
#749A Moment in the Life of an HN Genius: 1. Reads a technical document outside their domain. 2. Feels dumb because they don't have a grasp on any of the concepts. 3. Too busy to use the very internet which some of them probably helped build to magically render learning materials to the screen in front of them at zero marginal cost. 4. Sees the word "manipulation" 5. Substitutes the laymen's definition of "manipulation"…
Congrats, you hit the Smarty's Catch 22--thinking you found the error in the smart people's oversimplified reasoning with oversimplified reasoning and then throwing stones. /ducks
Please don't respond to a bad comment by breaking the site guidelines yourself. That just makes this place even worse.
Re: Statement of SEC Regarding Recent Market Volatility
#750Earlier quoted context omitted.
Why would shorting Gamestop mean making it to go bankrupt? The falling stock price of a company doesn't cause a company to go bankrupt, the causality is in the other direction. Putting downward pressure on price is useful only if you want to do a hostile takeover.
Because Gamestop is a business that is in the process of adapting to changing market conditions, which generally requires capital, and when market analysts go big on shorting in public it depresses stock price, and issuing stock is a major common method by which businesses raise capital. As another example, lots of people assume Elon Musk got mad at short sellers because he took it personally, when in fact they were…
This narrative that GameStop is actually a good company and it's turning around despite all the short interest is pure bologna. Worse, it's intentionally misleading and often espoused by people who have a financial interest in the company. It's crazy to see people in this forum, who are typically tech forward, hype up the business model of selling physical copies of video games.