Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Hedge fund Melvin sustains 53% loss after Reddit onslaught

arstechnica.com

Post reply on HN
Print view View original

101–110 of 410 posts

Re: Hedge fund Melvin sustains 53% loss after Reddit onslaught

#101

Post by dataflow »

robbomacrae wrote: post #91
kyrieeschaton wrote: post #29

How much evidence is there that the "reddit onslaught" actually moved the price, as opposed to them being the stalking horse for more sophisticated actors with more capital exercising a vanilla short squeeze strategy?

So many conspiracy theories on both sides these days. Don't forget Ocram's razor. I don't think there are many sophisticated actors here at all. I'm speaking as one who did DD on GME back in September and throw some money in (thought it was a great opportunity mainly because of Cohen + the upcoming console super cycle with a tiny chance of squeeze thrown in) It was a smart discovery by WSB and got a bit more than ave…

I wouldn't call it a conspiracy theory or call this out as an example of Occam's razor.

> Collectively they can, and did, cause this.. no need to invent other actors to explain it.

The thing is, people imagine this requires a lot of capital to pull off. How did WSB get so many people to invest so much into GME as to hit a hedge fund so hard? Do so many people really have that much money just to throw away? There is a need to explain this, and inventing other big actors does explain this much better for people.

Re: Hedge fund Melvin sustains 53% loss after Reddit onslaught

#102

Post by ajross »

elif wrote: post #77
ajross wrote: post #62

Earlier quoted context omitted.

They sell journalism under the NBC brand. Is this a serious question? If CNBC was issuing paid advertisement like that it would be a much, much bigger story than a spike in a small cap retail stock.

NBC has double the primetime product placement of it's next nearest competitor, fox. https://ufdc.ufl.edu/UF00101603/00001

That's about fictional TV shows, not news.

Re: Hedge fund Melvin sustains 53% loss after Reddit onslaught

#103

Post by bluGill »

fractionalhare wrote: post #64
drcross wrote: post #50

Earlier quoted context omitted.

I'll double down for you and it will really melt you brain- they paid Ars in this article to say they have covered their shorts. To think hedge funds wouldnt do such a thing when so much is riding on this, is extremely naive.

With respect, you haven't thought this through. Given there is "so much riding on this", why do you think a hedge fund would concoct a nefarious, extremely uncertain scheme to get people to think they closed instead of actually closing? You agree they're motivated by money, right? They would have lost literally all their money, even with the additional investment, if they were still in when GME soared to $400. They w…

Because closing their position is not what any sane shorter wants to do. The bottom line of GameStop sucks baddly. Anyone who can add to their shorts stands to make a fortune in a few months after this all calms down.

Though they might have seen what was happening and exited at 50 to reenter at 300. That would be incredible foresight.

Re: Hedge fund Melvin sustains 53% loss after Reddit onslaught

#104

Post by rantwasp »

robbomacrae wrote: post #91
kyrieeschaton wrote: post #29

How much evidence is there that the "reddit onslaught" actually moved the price, as opposed to them being the stalking horse for more sophisticated actors with more capital exercising a vanilla short squeeze strategy?

So many conspiracy theories on both sides these days. Don't forget Ocram's razor. I don't think there are many sophisticated actors here at all. I'm speaking as one who did DD on GME back in September and throw some money in (thought it was a great opportunity mainly because of Cohen + the upcoming console super cycle with a tiny chance of squeeze thrown in) It was a smart discovery by WSB and got a bit more than ave…

this is a classic example of a positive feedback loop. wsb did not do all of this but they were the spark that created the fire.

Re: Hedge fund Melvin sustains 53% loss after Reddit onslaught

#105

Post by ClumsyPilot »

londons_explore wrote: post #54
kyrieeschaton wrote: post #29

How much evidence is there that the "reddit onslaught" actually moved the price, as opposed to them being the stalking horse for more sophisticated actors with more capital exercising a vanilla short squeeze strategy?

My experience of reddit is you can get a "wildly successful" meme or post, yet rarely that translates into more than a few thousand dollars of cash being spent on anything. All the "wildly successful" kickstarters and stuff seem to have commercial backers lined up to make the social media buzz effect appear bigger than it is. I suspect the same happened here.

'spending' on random kickstarter products and investing your savings is obviously quite different. So you can't use one to judge the other

Re: Hedge fund Melvin sustains 53% loss after Reddit onslaught

#106

Post by totalZero »

astrange wrote: post #46
briefcomment wrote: post #34

Earlier quoted context omitted.

Edit: This is probably wrong. The funny thing is that the money Citadel makes off of Robinhood is basically front running RH trades. If those trades are for GME, Citadel has to choose between: - getting their front running revenue while increasing the price and making things worse for shorts (which I'm sure Melvin still has, despite their PR) - foregoing their RH revenue to not exacerbate the situation for shorts Pic…

Citadel Securities is not the same company as Citadel. And I don’t see why either of them should care about someone else’s shorts.

I hate to be pedantic, but they're both part of Citadel LLC. So yeah, they're the same company. They just happen to be two different businesses within the same company.

Re: Hedge fund Melvin sustains 53% loss after Reddit onslaught

#107

Post by rantwasp »

jnordonez wrote: post #69
kyrieeschaton wrote: post #29

How much evidence is there that the "reddit onslaught" actually moved the price, as opposed to them being the stalking horse for more sophisticated actors with more capital exercising a vanilla short squeeze strategy?

This has been my question as well. Especially when you overlay the charts for gme and amc and bb, they move almost identically. I really struggle to believe it's all gressroots. This entire thing was astroturfed if you ask me.

word on the wall street bets street is that there are a couple of big whales that are long on gme,amc and they are trying to generate a squeeze. at this point in time it’s basically a battle of the trading bots with the whole world watching.

Re: Hedge fund Melvin sustains 53% loss after Reddit onslaught

#108

Post by tzs »

Moodles wrote: post #16
saurik wrote: post #13

Earlier quoted context omitted.

Maybe so investors can evaluate the current status of their hedge fund without thinking there is some massive looming instability about to hit them?

Or, maybe they're lying to discourage more calls? In any case, their best strategy is to claim they're out of the short position so really them saying so is useless information.

> Or, maybe they're lying to discourage more calls?

Is this something they are legally allowed to lie about?

If it is not, is this the sort of thing they can lie about anyway because unless an insider blabs no one would know, or is it one of those things that someone would be able to figure out from required SEC filing or other public records?

Re: Hedge fund Melvin sustains 53% loss after Reddit onslaught

#109

Post by xyst »

If only we can weaponize this collective power for shorting shitty companies that have caused irreparable damage to society and the world (O&G, Koch Industries).

Right now the power of shorting companies is held by "institutional" investors simply because of how much funds are controlled by a select group of people and thus can buy and manipulate the market.

I would die happy if I saw Exxon or BP go to zero.

Re: Hedge fund Melvin sustains 53% loss after Reddit onslaught

#110

Post by bluGill »

icedchai wrote: post #75
newacct583 wrote: post #14

Earlier quoted context omitted.

The stock is currently around $300, up by a factor of five from last week and much more than that over its historical base. The question should be who isn't shorting GME, not leading questions about a conspiracy theory as to whether or not Melvin actually closed its shorts or not. I mean, I haven't shorted GME personally. But I've absolutely joked with friends that it's an obvious play. Maybe I should.

It seems less risky to buy puts, not short directly. I wouldn’t want to be short if this goes up another 10x, even briefly. It will go back down but you might get wiped out first.

The problem with puts is they can expire before this calms down. If you can get a short in and not get a margin call this is the opportunity of a lifetime. Only the biggest players dare risk it though.
Post reply on HN