Too Big To Lose a Trade!
Yesterday I told you about a developing story, a Reddit group started buying up stocks that Melvin Capital and other hedge funds were shorting. If the price goes up the hedge funds lose their trade and in one case they had shorted not only more than they could cover, but they also shorted for more than what their fund was worth putting them in an insolvent position.
The story spread across the Internet and more people started buying the stocks the hedge funds were shorting. Causing liquidity and solvency problems for these large hedge funds it briefly appeared that average every day people were going to be able to win a trade and "Long" out some hedge funds.
Today's update is Robinhood and other exchanges that were hosting these trades just stopped allowing average people to trade these stocks. Meanwhile, the hedge funds are free to make trades.
Robinhood confirmed that it has placed restrictions on several stocks due to volatility. “We continuously monitor the markets and make changes where necessary. In light of recent volatility, we are restricting transactions for certain securities to position closing only, including $AMC, $BB, $BBBY, $EXPR, $GME, $KOSS, $NAKD and $NOK. We also raised margin requirements for certain securities,” the blog post read.
The fight isn't over yet, there has been a lawsuit filed on Robinhood.
While the movement to Long the trades has been apolitical, mending anger between political groups.
The edge for the Hedge funds comes with it's political power.
Source:
Keep an eye on this situation it is a revolution of sorts!
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Reddit users investors are targeting stocks that have been heavily shorted by hedge funds that stand to lose billions unless their share prices fall.
Ironic that Robinhood is not actually Robin Hood and WSB is the real Robin Hood in this story...
Robinhood just proved it's not the app of the people, but of the oligrchs. I guess it's time for Hive, Monero and DEXs...
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This really really makes me want to pull all of my holdings out of Robinhood.
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HIVE is the REAL ROBINHOOD!
Their next big bet is $slv I just bought in like a fool. Hopefully it actually works out though!
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There is a lot of romance in this Gamestop discussion and people don't see all the facts behind. Michael Burry prepared everything spot on. The same guy that shorted on the housing market in 2007. That the guys on reddit spread the news and created FOMO, we see today. It turned to a classic pump and dump like we see so often.
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This is the first month of 2021
lot to come!
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HIVE!D
https://www.bloomberg.com/opinion/articles/2021-01-28/gamestop-may-be-a-reddit-wallstreetbets-game-but-nokia-sure-isn-t