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

Traders are increasingly betting against SpaceX just weeks after IPO

ft.com

Post reply on HN
Print view View original

11–20 of 32 posts

Re: Traders are increasingly betting against SpaceX just weeks after IPO

#11

Post by tronfx6969 »

da-x wrote: post #6
jorgeBanana wrote: post #4

They expect locked up shares to hit the market in August and tank the price

That could happen, but should also consider that it's often the case with lockups release that they do not inflict much change on the stock price, but only if there's already enough trading volume on the stock due to other market conditions.

you clearly over-analyze the problems ! The right question should be answered is: after the investor who participated in the spcx pre-sale, receive the lockup shares, what will they do ? And what makes them do that ? Under which conditions ?

Re: Traders are increasingly betting against SpaceX just weeks after IPO

#14

Post by lokar »

kingstnap wrote: post #5

"Just weeks" Weeks is an enormous amount of time now actually. The majority of plays in what people do with stocks is actually very short term. People aren't the kind of Berkshire buy and hold-ers anymore. If you look it up 60% of options volumes on the S&P 500 is 0 days to expiry. Literally gambling if it goes up and down this day. Btw its not just the US that's like this. South Koreas 2x single stock ETF debacle an…

A lot of the short dated options are market makers and index arbs hedging.

Re: Traders are increasingly betting against SpaceX just weeks after IPO

#15

Post by brazukadev »

lokar wrote: post #3

Seems odd that they don't discuss a common reason to short a stock: you expect it to go down, without any real opinion on the business. In this case there is going to be a ton of new float fairly soon. It's a pretty safe bet that this will depress the price. So the natural trade is to sell now (short), and buy later (cover the short). That effectively moves the future price drop to "now", which is likely what we see.…

> Seems odd that they don't discuss a common reason to short a stock

this was extensively discussed BEFORE the IPO. That is why it was overpriced.

> This is just one way (of many) in which the market factors future events into today's price, which is sort of the whole point.

nope. the market transferred $80B to Elon Musk from the people that got scammed.

Re: Traders are increasingly betting against SpaceX just weeks after IPO

#16

Post by kingstnap »

lokar wrote: post #14
kingstnap wrote: post #5

"Just weeks" Weeks is an enormous amount of time now actually. The majority of plays in what people do with stocks is actually very short term. People aren't the kind of Berkshire buy and hold-ers anymore. If you look it up 60% of options volumes on the S&P 500 is 0 days to expiry. Literally gambling if it goes up and down this day. Btw its not just the US that's like this. South Koreas 2x single stock ETF debacle an…

A lot of the short dated options are market makers and index arbs hedging.

It's about 50/50 retail to institutions.

Re: Traders are increasingly betting against SpaceX just weeks after IPO

#18

Post by lokar »

brazukadev wrote: post #15
lokar wrote: post #3

Seems odd that they don't discuss a common reason to short a stock: you expect it to go down, without any real opinion on the business. In this case there is going to be a ton of new float fairly soon. It's a pretty safe bet that this will depress the price. So the natural trade is to sell now (short), and buy later (cover the short). That effectively moves the future price drop to "now", which is likely what we see.…

> Seems odd that they don't discuss a common reason to short a stock this was extensively discussed BEFORE the IPO. That is why it was overpriced. > This is just one way (of many) in which the market factors future events into today's price, which is sort of the whole point. nope. the market transferred $80B to Elon Musk from the people that got scammed.

That’s an odd non sequitur. I’m simply describing why a lot of the short positions are not from people who have any opinion on the value of the stock. They are engaged in an almost mechanical arbitrage like trade.

People tend to imagine that all short sellers have some fundamental disagreement with the current value of the security, or are trying to manipulate to the value for some reason. It’s useful to understand there is a lot of volume that does not really care about the value debate one way or another.

Re: Traders are increasingly betting against SpaceX just weeks after IPO

#19

Post by rogerrogerr »

brazukadev wrote: post #15
lokar wrote: post #3

Seems odd that they don't discuss a common reason to short a stock: you expect it to go down, without any real opinion on the business. In this case there is going to be a ton of new float fairly soon. It's a pretty safe bet that this will depress the price. So the natural trade is to sell now (short), and buy later (cover the short). That effectively moves the future price drop to "now", which is likely what we see.…

> Seems odd that they don't discuss a common reason to short a stock this was extensively discussed BEFORE the IPO. That is why it was overpriced. > This is just one way (of many) in which the market factors future events into today's price, which is sort of the whole point. nope. the market transferred $80B to Elon Musk from the people that got scammed.

Musk's shares are locked up for a year.

Re: Traders are increasingly betting against SpaceX just weeks after IPO

#20

Post by theplumber »

lokar wrote: post #3

Seems odd that they don't discuss a common reason to short a stock: you expect it to go down, without any real opinion on the business. In this case there is going to be a ton of new float fairly soon. It's a pretty safe bet that this will depress the price. So the natural trade is to sell now (short), and buy later (cover the short). That effectively moves the future price drop to "now", which is likely what we see.…

I give you a common reason to short it: you had a 5% of the company float IPO, in a few months you will have 40% of the company or more on the public market . Not to mention the “special” changes to index funds etc just to keep its valuation high (some would say artificially). On top of that the valuation metric for its stock price are not earth-ish…
Post reply on HN