Live data from Hacker News

Reddit’s profane, greedy traders are shaking up the stock market

bloomberg.com

211–220 of 364 posts

Re: Reddit’s profane, greedy traders are shaking up the stock market

#211
post #23

Come on man, there's no where near enough volume there to move anything but the most low volume of stocks. All they trade in is meme stocks like TSLA, NFLX, MSFT, AAPL etc., and a few 100k on calls here or there won't budge the price in the slightest. On top of that, it's not even a P&D group, people there are just trading against each other, you have both bears and bulls and thetas. There's never been a concerted ef…

I wish people talked more about how Robinhood really enabled this sort of reckless speculation.

Day trading on your smartphone was not really a "thing" pre-Robinhood, and then they came along with commission free trades on both stocks and options.

So not only did they make it easier to day trade given no explicit fees for doing so, they also mainstreamed options trading, which is actually what most people in WSB do almost exclusively, and really the only way you can 10x-100x your money in a few months (or in less time).

Re: Reddit’s profane, greedy traders are shaking up the stock market

#212

Earlier quoted context omitted.

AFAICT the overwhelming majority of posters on WSB are basically burning money. Make enough bad trades and eventually one will accidentally make a bunch of money, but it's definitely not the norm.

Honestly, I'm convinced that most know how to hit F12 on Firefox and edit HTML pages to 'prove' that they are buying meme stocks. I have zero expectation that their 'proof' is even proof. All modern web browsers have a debug mode that allows you to easily edit HTML.

Most of the screenshots are from Robinhood mobile and real. Who's actually posting what is the difference and you only see the big gains and losses since they're exciting and not the thousands of people losing money daily on bad trades.

Re: Reddit’s profane, greedy traders are shaking up the stock market

#213
post #149

Earlier quoted context omitted.

The internet has generated this weird subculture of people who get really really upset at people making jokes. It has a "think of the children" sort of moral panic vibe to it. A lot of it has to do with completely ignoring any context or intention from the source material, which isn't how language works in any other context. Jokes inherently use exaggeration and extreme positions in jest which make them easy targets…

At what point does criticizing political correctness become as irritating and worthy of shunning as PC scolding itself? Because it's getting to a point where discussions are choked with anti-PC admonishments for every PC statement. It takes two to tangle, after all. Or two to go to culture war.

We've always had assholes who take things too far in society (Cosmo from Seinfeld/Michael Richards) was one of the first examples. He hasn't had work since and essentially committed social suicide as a response - which I think is becoming the new standard punishment and one that is way out of whack with who we are as humans. We give the appropriate social reaction, but I feel like it goes too far. People make mistakes, they always have.

But we're going through history with a fine-tuned brush and destroying anyone who doesn't fit into our modern conception of socially acceptable.

It'd be dumb to say the PC crowd is always getting it wrong. They do get it right often, but the pitchfork mob career/life ending response is where I part ways.

Where I differ, and I wish more people took a more rational approach to it, is that we're all flawed humans moving through a fucked up world. And we're unfairly destroying manu great minds and contributors in the process using some idealistic and unrealistic standard that none of us will ever achiever.

The end result is that the only people we allow to be leaders are milquetoast, authority-loving, angels who've never experimented in their lives.

This kind of this destroys culture. And the solution is to stop taking these small highly vocal mobs so serious and look at what they are. New idealistic well-intentioned Puritans 2.0.

We need to embrace the chaos and let people get offended again, and move on with our lives, because it really isn't that bad. It's not the way we reach progress.

If you want progress them embrace experimentation of all kinds, not some overton window with an ever growing list of things that are not okay. Or reevaluating the great people in history as if they grew up in the 1990s/early 2000s.

History is littered with mistakes but it's also full of great moments and experimentation and progress. The more we shut down this chaos every time we get offended the less great culture we'll get out of it.

If in the 1700s+ free speech had a clause where no one can get offended ever we'd live in the most boring and backwards world imaginable. The pseudo-progressives are attacking the very freedoms that allows progress to exist. And we need people will balls again to set up and push back. Because we aren't getting it from our university administrators trying to protector their jobs or from corporate pro-diversity divisions that are trying to keep up with culture, so you keep buy their products.

Top-down control of what is and what is not okay from culture is not that solution, period. Not doing that has allowed culture to flourish in the free democratic western states for decades and we're moving backwards, always with the best intentions, but too quickly to realize the side-effects and massive downsides of doing so.

/rant

Re: Reddit’s profane, greedy traders are shaking up the stock market

#214
post #23

Come on man, there's no where near enough volume there to move anything but the most low volume of stocks. All they trade in is meme stocks like TSLA, NFLX, MSFT, AAPL etc., and a few 100k on calls here or there won't budge the price in the slightest. On top of that, it's not even a P&D group, people there are just trading against each other, you have both bears and bulls and thetas. There's never been a concerted ef…

I have a theory that WSB are so bad at trading that they actually do manipulate stocks due to messing up every automated trading platform that assumes there'd be some logic to the trades being made. Someone's just bought a $1000 call option on a stock that's currently $400? Automated trading systems will probably raise alerts on that stock since someone must know something for that to happen. This appeared to happen…

There is no way Wall Street is using trades by retail traders as a signal (except maybe to counter-trade them). Also btw Wall Street can easily differentiate trades made by big players versus hordes of retail traders, because the banks and HFT firms are who executes the trades from retail brokerages. Retail brokerages like Robinhood don't have the authority to execute trades. They subcontract to a HFT firm who then uses the order flow to seek alpha (i.e., countertrade and run circles around clueless retail traders).

Re: Reddit’s profane, greedy traders are shaking up the stock market

#215
post #23

Come on man, there's no where near enough volume there to move anything but the most low volume of stocks. All they trade in is meme stocks like TSLA, NFLX, MSFT, AAPL etc., and a few 100k on calls here or there won't budge the price in the slightest. On top of that, it's not even a P&D group, people there are just trading against each other, you have both bears and bulls and thetas. There's never been a concerted ef…

It depends entirely on the security. Sometimes users will pick far out of the money strike with little volume and be the entire market for that day, but major stocks like AMZN have such deep option pools and liquidity that even the entire sub buying the same thing would be insignificant.

Options are derivatives of the security so any influence on share price will be a very diluted reaction based on risk and general market sentiment which I don't think a few thousand users are capable of. They would need to carry serious notional volume (in the 9+ figures) or major hedging risk with their brokers for any price action to occur, and even that might not last beyond days or hours.

Re: Reddit’s profane, greedy traders are shaking up the stock market

#216

Back in the early 2000's I worked for a company that was was hired (via intermediary law firms) by publicly listed companies to investigate pump and dump schemes on Yahoo message boards (you might call that the "Reddit of the early 2000's"). It involved a lot of web scraping Yahoo with Perl (specifically LWP) and then lots of analysis by humans with some help from automated tools. For example, if you plotted a histog…

Hah... The guys on the scox message board automated this pretty well; there was a user named warmcat who even opened sourced some of it. The Reddit comments usually aren't long enough to be meaningful, and I think that there are now organised p&d teams, so that level of investigation isn't very useful anymore

> The Reddit comments usually aren't long enough to be meaningful, and I think that there are now organised p&d teams, so that level of investigation isn't very useful anymore

The Yahoo comments usually weren't that long either. The key point was that while each individual post gave you, on average, only a little but of information, in the aggregate you got enough to narrow down who the source was to within 5 people. From there, you could usually narrow it down using "legwork" etc.

Re: Reddit’s profane, greedy traders are shaking up the stock market

#217

In other news, Vegas' profane, greedy gamblers are shaking up the economy.

I've never gambled before in my life. I've always been a very conservative indexer, but... I've got some spare dough. I have always been quite interested in the finance side of things, having worked under and been good friends with a dude with a graduate degree in Quantitative Finance, I spent years learning about random bits of finance stuff from him - enough that I knew a good bit about of some of /r/wallstreetbets' favorite investments, options.

I've been having a pretty good time perusing the forum and making bets of my own, even making a decent profit (relative to the money put in). I don't risk more than I'm willing to completely lose though. Some people on that forum are a quite reckless.

Re: Reddit’s profane, greedy traders are shaking up the stock market

#218

Earlier quoted context omitted.

Some of this can also be a totally legitimate result of putting dealers short gamma. When options dealers are short contracts, their delta hedging activity (ie, their effort to reduce first-order risk to the share price by buying or selling a commensurate amount of stock) contributes to the momentum of a large move, because dealers' hedges chase the stock. If this explanation is unsatisfactory, look up "short gamma"…

I love finding comments like this where I understand very little. (I am not being sarcastic). Excellent for learning.

If you’re interested in learning more about finance, I recommend subscribing to Money Stuff (free daily finance newsletter). Matt Levine does a great job of explaining concepts like these to a layperson and I love his sense of humor.

https://www.bloomberg.com/opinion/articles/2020-02-26/reddit...

Re: Reddit’s profane, greedy traders are shaking up the stock market

#219

Earlier quoted context omitted.

I have a theory that WSB are so bad at trading that they actually do manipulate stocks due to messing up every automated trading platform that assumes there'd be some logic to the trades being made. Someone's just bought a $1000 call option on a stock that's currently $400? Automated trading systems will probably raise alerts on that stock since someone must know something for that to happen. This appeared to happen…

Can they be bad at trading? https://xkcd.com/2270/

I wonder why this wouldn't work. If 90% of retail traders lose money, then why doesn't Etrade and Robinhood bet against its worst performing customers? Is there some law against this?

Re: Reddit’s profane, greedy traders are shaking up the stock market

#220

Earlier quoted context omitted.

I think he might have meant "political correctness" less in the sense of "extreme sensitivity about denigrating homosexuals" and more in the sense of "arbitrary rules of social etiquette that people get extremely upset at you for violating".

He actually reiterates the definition he had in the GP comment but then edited out: "Political correctness is a right-wing term used when they want to call somebody X, but may face social consequences for doing so." He thinks terms like 'political correctness' and 'victim culture' are some sort of right-wing slurs for virtuous attributes. He doesn't seem to be aware that this notion doesn't exist for 90%+ of the worl…

Sure, but most of the worlds population will still get irrationally upset at you for broaching social and cultural norms, like depicting Muhammad or denigrating the king.
Post reply on HN