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Hedge fund Melvin sustains 53% loss after Reddit onslaught

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

#111

Post by lr4444lr »

xyst wrote: post #109

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.

You want to short companies for moral reasons that have objectively strong fundamentals? That sounds extremely dangerous, financially speaking.

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

#112

Post by rantwasp »

mmahemoff wrote: post #79
ihunter2839 wrote: post #57

Earlier quoted context omitted.

Could you elaborate a bit on what you mean by this? I have seen similar comments elsewhere but don't really understand what is being suggested.

The media portrays it as "Redditors take on hedge funds". In reality, the volume indicates there's hedge funds, as well as a broad group of retail investors from outside Reddit, who have all jumped on the train. Hedge funds are on both sides of this.

yes, there are large whales that are long on gme. yes, a lot of retail investors have jumped on it. reddit is the propaganda machine that ignited the fire

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

#113

Post by lr4444lr »

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?

The enormous trading volume suggests that it wasn't a small rarified group.

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

#114

Post by nprz »

dataflow wrote: post #101
robbomacrae wrote: post #91

Earlier quoted context omitted.

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…

I mean the WSB user count has grown from 2.2m on Monday to now 7.5m. If 5 million of those users all bought $100 worth of GME that's half a billion, if they bought $1000, that's 5 billion.

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

#115

Post by wdn »

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?

Of course there are other big players that drive it.

Retail investors are in no way able to move price.

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

#116

Post by kasey_junk »

Just for context Melvin has returned better than 30% returns yearly since 2014. There is a very good chance if you are in their fund you’ll look at the total return and be quite happy with the outcome, especially if their risk is decorelated with the other parts of your portfolio.

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

#117

Post by tomp »

briefcomment wrote: post #34
BoorishBears wrote: post #15

Earlier quoted context omitted.

And the hedge funds making billions off that sentiment do as well of course, Citadel must be blushing at the runaway success of RH right now

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…

I explained my understanding of Citadel and market-making here: https://news.ycombinator.com/item?id=25942593

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

#118

Post by pureliquidhw »

dataflow wrote: post #101
robbomacrae wrote: post #91

Earlier quoted context omitted.

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…

COVID created a bored populous with stimulus checks to blow.

Recent retail investing has moved more tickers than just GME.

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

#119

Post by [deleted] »

mmahemoff wrote: post #92
nickysielicki wrote: post #32

Earlier quoted context omitted.

The way that WSB has latched onto Melvin as their enemy is to their detriment. It was never about killing Melvin capital, or at least, it shouldn't have been. It ought to have been about the ridiculous short interest on the stock, regardless of who was funding it. Whether or not Melvin specifically has covered their shorts is irrelevant to how the short interest as a percentage of float has changed in the past week.…

They latched onto Citron first. They're focusing on punishing the "enemy" instead of an abstract trade idea. Motivates holding longer instead of jumping ship to cash out. At this point though, many original buyers have probably sold some/all and most current holders are in it to make a quick buck, not to stick it to the suits. They'll be happy to jump off with a 2x or 3x return if they think the house of cards is abo…

[deleted]

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

#120

Post by briefcomment »

tedunangst wrote: post #96
briefcomment wrote: post #80

Earlier quoted context omitted.

You’re right that a lot of people say this. And not just random people, but people with large audiences, and people who presumably have some expertise. What is Robinhood’s relationship with Citadel then?

Not sure what the founder of barstool sports actual experience is in this area. Or whoever else. Also, it's very easy to describe order flow in a disingenuous way (citadel sees the order before the market) that's technically true and will make people think it's front running. Did the experts say front running? Or did they say paid for orders and somebody else said front running?

Here's AOC discussing it

https://www.msn.com/en-us/money/other/aoc-returns-to-twitch-...

And here's a Vice article about it. They don't mention front running, but the outcome sounds the same, in that the customers are not paying the best price for the stock, since the middle man pockets some.

https://www.vice.com/en/article/qjpnz5/robinhoods-customers-...

Also, thread. Can't speak for the expertise of the author, but at least he links to several articles in the comments. https://twitter.com/toxic/status/1353890772135813121

This guy describes it as front running. https://mobile.twitter.com/anyaparampil/status/1355984104525...

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