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Forum » The total lack of finance and market knowledge on the Misc is ASTOUNDING
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Thread: The total lack of finance and market knowledge on the Misc is ASTOUNDING

post 1629963623 01-28-2021, 04:47 PM
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Originally Posted By wasp9166⏩
How can a third person buy them ,if he doesn't sell them back to the brokerage that sold them to him ,how are they on the hook ?

The only way he can cash out is to sell no?

And who is gonna buy them at 47 mill ?

He's basically got a bunch of stuff worth x on paper

But unless someone buys them ,he's got nothing

What am I missing
like jademaster said, they're basically transferring the contract to someone else who then has the right to exercise the options. the seller has an obligation to sell and must sell the shares to whoever is holding the contract
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post 1629964103 01-28-2021, 04:53 PM
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Originally Posted By wasp9166⏩
How can a third person buy them ,if he doesn't sell them back to the brokerage that sold them to him ,how are they on the hook ?

The only way he can cash out is to sell no?

And who is gonna buy them at 47 mill ?

He's basically got a bunch of stuff worth x on paper

But unless someone buys them ,he's got nothing

What am I missing
To my understanding it’s like this:

The call option is sold by person A to person B.
Person B hopes the stock falls in price, person A hopes it goes up.

If the stock falls person A has to pay person B, and vice versa.

The option owned by person B can also be sold to another person, C, and person A then has to pay person C instead of B.
Real Madrid, Miami Heat, New York Jets.
post 1629967653 01-28-2021, 05:34 PM
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But who is gonna buy it at $480 when almost everyone knows it's going back to $17

I'm just confused how you cash out

Wouldn't you need to find 47 million idiots ?

Lol
post 1629969233 01-28-2021, 05:50 PM
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Originally Posted By wasp9166⏩
But who is gonna buy it at $480 when almost everyone knows it's going back to $17

I'm just confused how you cash out

Wouldn't you need to find 47 million idiots ?

Lol
At a really basic level, you're cashing out of the autism-priced stock by selling it to the hedge funds.

The hedge funds sold stock they didn't own (shorting) by borrowing shares from longs. They planned to sit on it until GME went bankrupt so they'd effectively never have to pay the longs back. Since they were treating it like an infinite money machine, they went in deep on this deal.

WSB autists figured this out and realized that once they drove up the price high enough to force the hedge funds to abandon their positions when their finances crumbled from owing all that money, the only way they'd be able to buy enough shares to cover their positions was by buying them at the autism price, since there's literally nowhere else to go for the shares.
Nah, fukk that. I’m not doing that.
post 1629969523 01-28-2021, 05:53 PM
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Originally Posted By ANumber1⏩
At a really basic level, you're cashing out of the autism-priced stock by selling it to the hedge funds.

The hedge funds sold stock they didn't own (shorting) by borrowing shares from longs. They planned to sit on it until GME went bankrupt so they'd effectively never have to pay the longs back. Since they were treating it like an infinite money machine, they went in deep on this deal.

WSB autists figured this out and realized that once they drove up the price high enough to force the hedge funds to abandon their positions when their finances crumbled from owing all that money, the only way they'd be able to buy enough shares to cover their positions was by buying them at the autism price, since there's literally nowhere else to go for the shares.
aha


But ,is the long payback on a timer or something

Couldn't they still sit on it till gs goes bankrupt

Not like all this changed anything
post 1629969843 01-28-2021, 05:56 PM
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Originally Posted By wasp9166⏩
But who is gonna buy it at $480 when almost everyone knows it's going back to $17

I'm just confused how you cash out

Wouldn't you need to find 47 million idiots ?

Lol
An option is a contract with a set price and expiration. It's no longer voluntary/discretionary.
post 1629970133 01-28-2021, 06:00 PM
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Originally Posted By wasp9166⏩
But ,is the long payback on a timer or something

Couldn't they still sit on it till gs goes bankrupt

Not like all this changed anything
So the timer is basically "when your lenders tell you to stop". Retail investors who trade on margin get what's called a "margin call" when the prices of their portfolio get too deep into their credit line, where the broker tells them they have X amount of time to come up with the money or they'll start forcibly selling their assets.

Hedge funds are dealing with more or less the same issue here. They're financed, and as I understand it, Melvin Capital - the main hedge fund short - apparently got an emergency infusion of two and a half billion dollars from Citadel to try to ride this out. If the autists can hold out and push hard enough, eventually Melvin hits a financial wall and closes the position, either voluntarily or, like, in bankruptcy.

I haven't looked hard into the options chain to fully understand what they're expecting tomorrow, but apparently they believe the noose will get tighter when a bunch of weekly options expire. The options are on a timer: they're pre-arranged contracts to buy or sell at X price on X date, and if they're profitable, they will almost certainly be executed by the owners of the contracts on that date, which will force a bunch of money to move no matter what Melvin and Citadel think about it.
Nah, fukk that. I’m not doing that.
post 1629970543 01-28-2021, 06:04 PM
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Originally Posted By ANumber1⏩
So the timer is basically "when your lenders tell you to stop". Retail investors who trade on margin get what's called a "margin call" when the prices of their portfolio get too deep into their credit line, where the broker tells them they have X amount of time to come up with the money or they'll start forcibly selling their assets.

Hedge funds are dealing with more or less the same issue here. They're financed, and as I understand it, Melvin Capital - the main hedge fund short - apparently got an emergency infusion of two and a half billion dollars from Citadel to try to ride this out. If the autists can hold out and push hard enough, eventually Melvin hits a financial wall and closes the position, either voluntarily or, like, in bankruptcy.

I haven't looked hard into the options chain to fully understand what they're expecting tomorrow, but apparently they believe the noose will get tighter when a bunch of weekly options expire. The options are on a timer: they're pre-arranged contracts to buy or sell at X price on X date, and if they're profitable, they will almost certainly be executed by the owners of the contracts on that date, which will force a bunch of money to move no matter what Melvin and Citadel think about it.
Yeah ,heard about the expiring tomm

All interesting ,best thing on tv in months
post 1629970933 01-28-2021, 06:09 PM
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Originally Posted By wasp9166⏩
Yeah ,heard about the expiring tomm

All interesting ,best thing on tv in months
Seriously. This is a pretty sophisticated raid for a bunch of people who communicate in rocketship and diamond emojis, and it all happened because the hedge funds were dumber than chit about it. The whole point of a hedge fund is to hedge risk so it's nearly impossible to lose.

"I hope nobody on the internet checks the public records and figures out how to murder us" isn't a hedge.
Nah, fukk that. I’m not doing that.
post 1629971113 01-28-2021, 06:11 PM
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#40
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Originally Posted By ANumber1⏩
Seriously. This is a pretty sophisticated raid for a bunch of people who communicate in rocketship and diamond emojis, and it all happened because the hedge funds were dumber than chit about it. The whole point of a hedge fund is to hedge risk so it's nearly impossible to lose.

"I hope nobody on the internet checks the public records and figures out how to murder us" isn't a hedge.
They are saying it's most likely not Joe shmo

But it's going to be hard to prove
post 1629971153 01-28-2021, 06:12 PM
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The market is a scam for 98.9% of investors.
Get a good ETF so you have something to talk about with the CEOs and gamble the rest on cryptocurrency.
post 1629971543 01-28-2021, 06:18 PM
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#42
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Originally Posted By Brosnbroccoli⏩
To my understanding it’s like this:

The call option is sold by person A to person B.
Person B hopes the stock falls in price, person A hopes it goes up.

If the stock falls person A has to pay person B, and vice versa.

The option owned by person B can also be sold to another person, C, and person A then has to pay person C instead of B.
Originally Posted By jademaster⏩
Good explanation.

It's sort of like trading stocks... If I buy a share of stock from you, and later I decide I no longer want to own it, I don't have to sell it back to you. There are many people who trade stocks, and any one of them could buy the stock from me.





Not necessarily. He can also exercise the option, which means converting it into stock. When he exercises it, whoever sold him the option has to give him the share of stock. Then he could sell the stock if he wants cash.

Being able to convert an option is what gives it real value instead of just a "paper profit." It ensures you aren't dependent on selling it to someone else to lock in a gain.
Originally Posted By wasp9166⏩
But who is gonna buy it at $480 when almost everyone knows it's going back to $17

I'm just confused how you cash out

Wouldn't you need to find 47 million idiots ?

Lol
im gonna have an aneurysm reading these

and thats not to chit on you wasp, but just know the guys giving you answers understand as much as you do but are for some reason pretending to know more


here's the best most dumbed down explanation of how they workhttps://www.investopedia.com/terms/c...iration%20date.
Official LTC representative
post 1629971983 01-28-2021, 06:23 PM
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#43
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Originally Posted By ayyy⏩
im gonna have an aneurysm reading these

and thats not to chit on you wasp, but just know the guys giving you answers understand as much as you do but are for some reason pretending to know more


here's the best most dumbed down explanation of how they workhttps://www.investopedia.com/terms/c...iration%20date.
oh I'm not worried

Could have an aneurysm from tech tho

Don't let my posts raise your bp
post 1629972133 01-28-2021, 06:24 PM
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Originally Posted By ANumber1⏩
So the timer is basically "when your lenders tell you to stop". Retail investors who trade on margin get what's called a "margin call" when the prices of their portfolio get too deep into their credit line, where the broker tells them they have X amount of time to come up with the money or they'll start forcibly selling their assets.

Hedge funds are dealing with more or less the same issue here. They're financed, and as I understand it, Melvin Capital - the main hedge fund short - apparently got an emergency infusion of two and a half billion dollars from Citadel to try to ride this out. If the autists can hold out and push hard enough, eventually Melvin hits a financial wall and closes the position, either voluntarily or, like, in bankruptcy.

I haven't looked hard into the options chain to fully understand what they're expecting tomorrow, but apparently they believe the noose will get tighter when a bunch of weekly options expire. The options are on a timer: they're pre-arranged contracts to buy or sell at X price on X date, and if they're profitable, they will almost certainly be executed by the owners of the contracts on that date, which will force a bunch of money to move no matter what Melvin and Citadel think about it.
But now people are saying today when the price was at the high the hedge fund made another short play, then had the trading platforms halt trading. Thus crashing the price allowing them a huge win. So basically at this point they have nothing to worry about right because they've already won huge off the short today?
post 1629974013 01-28-2021, 06:47 PM
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Originally Posted By ExPatriot⏩
Buy high, sell low...

Amirite OP?
It's lower than you think.
post 1629974183 01-28-2021, 06:50 PM
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#46
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Originally Posted By Unstumpable⏩
But now people are saying today when the price was at the high the hedge fund made another short play, then had the trading platforms halt trading. Thus crashing the price allowing them a huge win. So basically at this point they have nothing to worry about right because they've already won huge off the short today?
Yeah ,seems fishy ,ceo of robinhood was on cnbc earlier and he'll be on again in the morning

"Noone told us what to do with our platform "
post 1629974303 01-28-2021, 06:51 PM
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Originally Posted By Unstumpable⏩
But now people are saying today when the price was at the high the hedge fund made another short play, then had the trading platforms halt trading. Thus crashing the price allowing them a huge win. So basically at this point they have nothing to worry about right because they've already won huge off the short today?
No. Even if it had gone down 90% today the shorts still would have lost immense amounts of money. (Assuming the price stayed the same for the rest of the year which is a big assumption)
post 1629975063 01-28-2021, 06:58 PM
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People have to learn somewhere. Better to play around with a few hundred when you are 20 and learn now than to lose your retirement when you are 60.
post 1629976743 01-28-2021, 07:15 PM
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Originally Posted By Unstumpable⏩
But now people are saying today when the price was at the high the hedge fund made another short play, then had the trading platforms halt trading. Thus crashing the price allowing them a huge win. So basically at this point they have nothing to worry about right because they've already won huge off the short today?
Maybe partially true. There are rumors that the ratio of short shares is even higher now than when this started, but I haven't tried to look into it. Suppose they successfully balanced out their losses on the initial position, the gainz are unrealized until they close the positions. To close the positions, they'd have to buy bigly and WSB cashes in. I doubt they can walk away clean unless it gets much closer to the "normal" pricing.

That's why you see all the WSB people screaming "APES TOGETHER STRONG" and "HOLD THE LINE". They figure they can hold out indefinitely and eventually the hedge funds get tired of having their money tied up in this and abandon the positions, the only way out is to buy what they've got, at stupid prices.
Originally Posted By wasp9166⏩
Yeah ,seems fishy ,ceo of robinhood was on cnbc earlier and he'll be on again in the morning

"Noone told us what to do with our platform "
LOL, I saw that. He's full of chit. Other brokers already admitted their clearing houses cut them off. Will never trust that guy with any of my money.

Also Elizabeth Warren trying to "both sides" this thing like it's all nefarious and we need to regulate them both. The hedge fund made a mistake is all, now they've got a fuhrerbunker situation, fair and square. If they were smart they would have exited early when they realized what was happening, or never gotten into this situation in the first place.
Nah, fukk that. I’m not doing that.
post 1629977153 01-28-2021, 07:21 PM
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Originally Posted By Brosnbroccoli⏩
To my understanding it’s like this:

The call option is sold by person A to person B.
Person B hopes the stock falls in price, person A hopes it goes up.

If the stock falls person A has to pay person B, and vice versa.

The option owned by person B can also be sold to another person, C, and person A then has to pay person C instead of B.
If person b sells it to c and the stock goes up, person b isn't responsible for paying person c but person a is?
post 1630320993 02-02-2021, 12:37 AM
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Originally Posted By meanstringbean⏩
I got negged to the gills for telling holders of BB, AMC, BBBY to get the **** out of those positions. People think they are on some hedgefund heist where everyone makes money and wins, but dont realize they are just in a modern day pump and dump scheme (something that's been around for as long as the stock market) which will produce just as many losers as winners - talking common people here not just a hedgefund.

Felt good about my quick 2 day 40% return but when I saw the misc and my knuckle dragging friends saying 'buy AMC! buy BB!' etc. I knew it was time to GTFO
See this is one of the people that have no idea what they are talking about, even worse he thinks that he does.
One day scientists are going to kill us all.
post 1630321233 02-02-2021, 12:44 AM
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What every investor should read:

https://web.stanford.edu/~wfsharpe/a...ive/active.htm
How to lose fat for Noobs: http://forum.obnoxiousbrutes.com/showthread.php?t=129247741
post 1630321633 02-02-2021, 12:56 AM
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Originally Posted By CptClean⏩
See this is one of the people that have no idea what they are talking about, even worse he thinks that he does.
Lol true, he was in the very first page of the stickied thread telling people there was no more money to be made when GME was still at like 100
post 1630321833 02-02-2021, 01:02 AM
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That feel when you come to a misc forum for financial advice
brb haven’t met one vaxcel who doesn’t get defensive or mad when you tell them you didn’t get it.

No “vax” for HIV after 40 years of research. No vax for cancer after 100 years of research. No vax for the common cold and yet a virus mysteriously appears and Within 12 months a “vax” is found by 4 pharma companies all within 1 week and we are mandated to take it ….
post 1630322193 02-02-2021, 01:18 AM
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Originally Posted By syrk⏩
That feel when you come to a misc forum for financial advice
Pretty much every single person I know considers themselves to be Peter Lynch in the past couple weeks. Strange times.
post 1630322383 02-02-2021, 01:24 AM
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Originally Posted By CptClean⏩
I've never seen so many totally retarded and wrong posts in a day ever before and I have been on this forum for 14 years.

Seriously you guys spend this much time on the internet and still have no clue how any of this works?
Its called satire, mate.








MISC is a place were people fuk around and troll. With that being known, you expecting PHD level economic competency or even coherent conversation is more a judgment on you, that the MISC. SRS
Outdoors brah is a purely fictitious persona. Any contextual or graphic creation, opinion, or post made by Outdoorsbrah is not a reflection of real life or reality in any manner, expressed nor implied.

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post 1630323033 02-02-2021, 01:48 AM
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Originally Posted By OutdoorsBrah⏩
Its called satire, mate.








MISC is a place were people fuk around and troll. With that being known, you expecting PHD level economic competency or even coherent conversation is more a judgment on you, that the MISC. SRS
Look at my join date bro don't ****ing tell me about the misc lmao.

I'm talking about the people trying to jump on the meme stock movement, or trying to bash it, both who are equally uninformed.
One day scientists are going to kill us all.
post 1630323113 02-02-2021, 01:52 AM
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Originally Posted By BigElephant⏩
I wouldn't know and I don't comment on it. Finance and economics always bored me.
they may be boring but it's important to know in real world
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