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u/DeepFuckingValue and the GameStop Reddit mania

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Re: u/DeepFuckingValue and the GameStop Reddit mania

#61

Post by cecilpl2 »

acover wrote: post #45
raziel2701 wrote: post #22

On wsb u/deepfuckingvalue showed he still holds 50,000 shares and 500 deep ITM call options. He has secured a profit of $13.8 million dollars, and his remaining open position is valued at $45 million. I would caution people to not quickly fall into the "if he's still in, I'm still in" meme. He has secured a $14 million bag, regardless if the stock goes to zero he's already secured a life changing amount of money, he…

Couldn't those with shorts buy otm calls to hedge the possibility of a squeeze?

OTM calls are super expensive because the IV is through the roof (it has been over 700% most of the week).

Re: u/DeepFuckingValue and the GameStop Reddit mania

#62

Post by tinyhouse »

yreg wrote: post #35
raziel2701 wrote: post #22

On wsb u/deepfuckingvalue showed he still holds 50,000 shares and 500 deep ITM call options. He has secured a profit of $13.8 million dollars, and his remaining open position is valued at $45 million. I would caution people to not quickly fall into the "if he's still in, I'm still in" meme. He has secured a $14 million bag, regardless if the stock goes to zero he's already secured a life changing amount of money, he…

Well if a stock market crash triggered by this is realistic (which I agree is), doesn't it make sense to hold a bit of GME for insurance? I understand that there's no guarantee one will be able to exit it successfully even if it flies so high that it crashes the market. However I don't see a better insurance for people who don't have access to options/inverse etfs and don't want to sell their stocks.

The problem for GME is that it will crash regardless if there's stock market crash or not. When a market crash happens you're much better off holding value stocks of solid companies.

As of mr. DFV, I'm sure he'd like to close his position at the current price. But my guess is that he prefers to hold for his reputation. Since he already guaranteed more money than he would ever need, it's not a bad decision. The other option is that he believes it's going climb even more, which is possible. But don't assume people hold for any reason other than making money. Once the squeeze is over it will fall like dominoes.

Re: u/DeepFuckingValue and the GameStop Reddit mania

#63

Post by ggggtez »

tootie wrote: post #25
raziel2701 wrote: post #22

On wsb u/deepfuckingvalue showed he still holds 50,000 shares and 500 deep ITM call options. He has secured a profit of $13.8 million dollars, and his remaining open position is valued at $45 million. I would caution people to not quickly fall into the "if he's still in, I'm still in" meme. He has secured a $14 million bag, regardless if the stock goes to zero he's already secured a life changing amount of money, he…

It says as much in the article. He literally just thought GME was undervalued on its merits. He had no intention of creating a squeeze or punishing Melvin.

Just because he's still in doesn't mean that it's actually worth $300 on the fundamentals. I could definitely see the argument that $20 was undervalued, but it's plain to see that the short-squeeze is now part of the calculation of value.

There is no way that GameStop has an actual fundamental value of $300 per share. That price is clearly inflated, and in a few weeks will decrease, probably to somewhere above $20, but not that much higher. The market will eventually correct, but $300 is an over-correction for sure.

Re: u/DeepFuckingValue and the GameStop Reddit mania

#64

Post by semi-extrinsic »

misiti3780 wrote: post #31

I'm honestly confused by the press around this event. I get it, /DFV started a short squeeze and got rich, that is great for him. I don't support naked shorting, it should probably be illegal (if it is not already) and it looks that was part of the reason this happened. Everyone has been suspecting for a while (especially here) that a lot of volatility in stocks like TSLA etc was due to Robinhood. As of 5:33 EST, I'm…

I've also seen some speculation that Citadel may have been intentionally amplifying the short squeeze caused by Redditors, and then getting a sweet deal with Melvin capital by injecting money the latter sorely needed in exchange for a share of future revenue.

I don't understand exactly how the math works out there to be able to evaluate if it was an extra good deal or not, but I find it credible that institutional investors jumping on the Reddit hype would be necessary in ordet to sustain the kind of momentum we are seeing.

Edit - or as people on Twitter put it:

any story that doesn't say how, past the retail ignition, the rocket ship was mostly intra-fast money warfare, simply isn't telling the truth

https://twitter.com/zatapatique/status/1354904995901136896?s...

Re: u/DeepFuckingValue and the GameStop Reddit mania

#65

Post by yreg »

afterburner wrote: post #47
yreg wrote: post #35

Earlier quoted context omitted.

Well if a stock market crash triggered by this is realistic (which I agree is), doesn't it make sense to hold a bit of GME for insurance? I understand that there's no guarantee one will be able to exit it successfully even if it flies so high that it crashes the market. However I don't see a better insurance for people who don't have access to options/inverse etfs and don't want to sell their stocks.

> Well if a stock market crash triggered by this is realistic (which I agree is), doesn't it make sense to hold a bit of GME for insurance What is the reasoning here? Are you under the impression GME wouldn't crash right alongside the market? This isn't BTC or gold we're talking about. It's just another stock.

Presumably the crash would occur after the GME price skyrockets and shorts (and then their brokers and clearing houses) go broke trying to close the short positions.

The insurance pays up if they buy your share.

Do you have another idea how it could end?

Re: u/DeepFuckingValue and the GameStop Reddit mania

#66

Post by BitwiseFool »

eMGm4D0zgUAVXc7 wrote: post #24
devops000 wrote: post #10

Earlier quoted context omitted.

I hope one day we will see an IPFS link

Why do people constantly have to re-invent the wheel? :( Freenet [0] has been providing censorship-resistant, anonymous, decentralized hosting for 20 years - and is still in active development! You could upload it to Freenet without any server whatsoever and it would stay online for as long as it is popular, even if your machine goes offline. And you'd be anonymous while doing so! [0] https://en.wikipedia.org/wiki/Fr…

Thank you for sharing, I didn't even know this existed and no one brought it up during the deplatforming debate this month.

Re: u/DeepFuckingValue and the GameStop Reddit mania

#67

Post by leadingthenet »

afterburner wrote: post #47
yreg wrote: post #35

Earlier quoted context omitted.

Well if a stock market crash triggered by this is realistic (which I agree is), doesn't it make sense to hold a bit of GME for insurance? I understand that there's no guarantee one will be able to exit it successfully even if it flies so high that it crashes the market. However I don't see a better insurance for people who don't have access to options/inverse etfs and don't want to sell their stocks.

> Well if a stock market crash triggered by this is realistic (which I agree is), doesn't it make sense to hold a bit of GME for insurance What is the reasoning here? Are you under the impression GME wouldn't crash right alongside the market? This isn't BTC or gold we're talking about. It's just another stock.

> Are you under the impression GME wouldn't crash right alongside the market?

Well ... yeah. Today it hasn't.

Re: u/DeepFuckingValue and the GameStop Reddit mania

#68

Post by ggggtez »

sumedh wrote: post #37
tootie wrote: post #25

Earlier quoted context omitted.

It says as much in the article. He literally just thought GME was undervalued on its merits. He had no intention of creating a squeeze or punishing Melvin.

> He had no intention of creating a squeeze If I am not mistaken he did say in one of his videos that there is a chance for a squeeze to happen.

I believe this is CYA (cover your ass) language. Given the recent interest in the case, he's likely saying now that he didn't intend to (or that even if he intended to, he didn't think it was within his power) as a pre-emptive defense against litigation.

Re: u/DeepFuckingValue and the GameStop Reddit mania

#69

Post by redkoala »

yreg wrote: post #35
raziel2701 wrote: post #22

On wsb u/deepfuckingvalue showed he still holds 50,000 shares and 500 deep ITM call options. He has secured a profit of $13.8 million dollars, and his remaining open position is valued at $45 million. I would caution people to not quickly fall into the "if he's still in, I'm still in" meme. He has secured a $14 million bag, regardless if the stock goes to zero he's already secured a life changing amount of money, he…

Well if a stock market crash triggered by this is realistic (which I agree is), doesn't it make sense to hold a bit of GME for insurance? I understand that there's no guarantee one will be able to exit it successfully even if it flies so high that it crashes the market. However I don't see a better insurance for people who don't have access to options/inverse etfs and don't want to sell their stocks.

This isn't really the place for financial advice. Matt Levine does publish a newsletter that attempts to unpack the GameStop Reddit mania situation and what it means for the retail investors piling on.
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