Reddit r/WSB bankrupts Hedge Fund using Robinhood

[WillHurtDontCare]

https://twitter.com/i/web/status/1354806223472717831

View: https://twitter.com/disclosetv/status/1354806223472717831/photo/1

 

[MJ DeMarco]

The initial inflow of funds was based on solid reasoning.

You say this as if this "reasoning" is some type of new found strategy.

"Buy heavily shorted stocks because a short squeeze covering is coming!" has been around for decades. What hasn't been around for decades, is the flash mob organization that can push that reasoning, beyond reason.

These events are primarily based on a mob mentality, with no reasoning other than some rocket emojis.

It's dumb money.

But even dumb money makes a killing every once in awhile, so yea, good for them.

I hope they escape the carnage that will likely follow. Better, I hope lives are changed for the few that rode the wave and cashed out at the right time.

I'm going to assume you don't call it "dumb money" when you make successful trades.

No, because I don't make trades by following a flash mob.

I have solid reasoning behind my trades, fully backtested with a proven mathematical history of success.

While past isn't a guarantee of the future, it is a pretty damn good indicator.

In other words, if I made a trade it is because the stock/option exists in a market condition (moving averages, W%, RSI, ADXs, and other technicals) that has repeated in the last 10 years, and in the last 10 years, it has been 92% successful.

That's how a trade ... purely mathematical, not because a bunch of anonymous Robinhood traders on a message board told me to.

 

[theag]

But some fundamentals on the foundation is not lining up correctly for me

You don't say.

 

[James Fake]

All I see here is polarism. Have you noticed the clash of generations getting stronger and stronger? Except that it's mostly Boomers vs. any generation Millennials and under.

If you take a look at those completely against WSB and want to see it's failure; there is an obvious generational gap. One could even go as far as to say; it's Boomers vs. Younger Investors in general when saying WSB vs. retail investors.

It's because as Millennials; we saw as juveniles what 2008 did to us personally, family, friends, etc. (Some even their parents getting f'ed by 1999 and even 9/11). We carry intense hatred to those (and the "system") not punished from that as many was left for dead, and/or scraping and fighting for jobs as we literally entered the work force as things were complete shit. Amongst hundreds of other reasons; at one point, the Silent and Great Generation looked and hated how the Boomers moved as well. (That's not to say all Boomers, as I've met quite a few that was caught on the wrong side of the 2008 fence and are way more intensely fighting with WSB than even I)

It's nothing new though; it's how humans evolve. As the upcoming generation begins taking the "dominant" generation; this same clash always happens. Eventually, progression aka adaption to 'environment change' wins. Because we as humans; unlike any other animal species, we don't adapt to our environment, we make the environment adapt to us.

No shots, but it's biological. At a certain point; the mind stops accepting change including any environmental change. ("You can't teach an old dog tricks") And why would it? It makes sense.. Whatever they've done has obviously worked great for survival for decades and decades, and even (for ones here especially) thriving and propelling them to success. But with that is a double-edged sword, the inability to adapt or change the environment becomes stronger and stronger.

And this is something that I, myself, will even face one day with my own children.

Eventually; there will be a robot standing over me that could easily snap my neck with it's functional arms as I wake up and ask me a really personal question that obviously my kids sent the request for it to do. Am I comfortable with that now? NO. But.... it WILL happen one day.

Not sure if anyone owns a Tesla in here; but when I first drove a Tesla and put it on auto-pilot mode; I was skeptical, and scared af. I was putting the sole trust of my life in this machine in the middle of an 6 lane interstate. My sphincter still hasn't recovered from the intensity of that ride. And even I, as technologically progressive as I think I am, was shitting bricks as I tried to accept change.

And just like that personal freaky robot just starring at me all day... one day, EV and autonomous driving WILL be the future... and well within my generation.

Rinse and repeat.

"DAD, ITS FINE!!! UGH... JUST PUT IT ON AUTO-AUTO-PILOT RIGHT NOW AND STICK YOUR HEAD INTO THE VR SET. YOU'RE MISSING YOUR GRAND KID'S PRECIOUS FIRST MOMENTS. THE CAR IS NOT GOING TO CRASH WHILE YOU AREN'T LOOKING".

And as for crypto-currency; the argument of "being stolen by govt" will be null when eventually; just like privacy invading home robots and pure auto pilot cars, blockchain will eventually run on a true peer-to-peer network where internet is not needed. Information will exchange on a blockchain from being within proximity of another (a super charged blue tooth/air drop). Real time updated info, no internet. Will Bitcoin go into a bear market before then making the "watch yall kids get shitted on by that bubble" a true statement? Probably... but by then; we'll have shifted money into whatever else is coming up. It's not always how you get up from a fall, but it's also how you catch your self while falling.

I think we're arguing about an infancy tech that is literally still on dial-up connection while discussing the topic of 'streaming movies'. And I, was most definitely not thinking as I was in an AOL chatroom asking a/s/l that one day I would have my entire movie catalog on there.

With ALL that said...

GME squeeze is still on. Massive exit of Robberhood to Fidelity with exception of GME, AMC stocks already bought on Robberhood is staying til this is over and sold.

Will this tank the market? Sure... once literally EVERYONE and their mama quits calling for a market crash. If it's one thing; people can't time the top for shit.. and it's gonna prove itself once again. Where were these same folks in February 2020? No where... because I (and only a few others) were the only idiots standing there yelling about Covid and how its gonna crash the market, and I was the lone sheep looking stupid. If it's one true proven rule in markets, it's that it never does what the majority predict it will (and certainly especially in the short terms).

The market crash comes when These same people flip and change their tune. Could it happen over the next week. Sure, it could and I'll be watching for these same folks to capitulate into buying and/or completely forgetting about their current bearish sentiment. But for this upcomig week? I think it's wayyyy too many people hating and wanting to see WSB's failure and shorting and Putting thinking they are the Big Short and blindlessly ignoring fundamentals: The same people they hate may possibly get $1200 more, and interest rates remain 0%, and no slowing down of behind the scenes QE including all the backdoor QE happening overseas.

 

[theag]

Seems like people are starting to lose money.

https://twitter.com/i/web/status/1356618475234557956

View: https://twitter.com/stoolpresidente/status/1356618475234557956?s=20


This guy bought $1M worth of GME yesterday at 260 and lost around half of it in 24 hours, with it currently trading at 130:

https://www.reddit.com/r/wallstreetbets/comments/la6w8q View: https://www.reddit.com/r/wallstreetbets/comments/la6w8q/just_bought_1mm_worth_of_gme_my_profits_from/

Can't wait to see this whole F*cking house of cards crash and burn. And I don't mean just the meme stocks.

 

[MJ DeMarco]

Anyone want to talk about GameStop's business model, its financial numbers, its prospects for growth and massive profits? You know, the real reasons why a company is investment worthy?

I guess not.

LOL.

 

[MitchC]

Bloomberg Businessweek on Instagram: "● The mania was years in the making and started as a value play. Link in our bio for the full story.⠀ ⠀ ● Short sellers have been called a lot of things. Bloodsuckers. Parasites. Other words not fit to print. Now

39K likes, 757 comments - businessweek on January 25, 2021: "● The mania was years in the making and started as a value play. Link in our bio for the full story.⠀ ⠀ ● Short sellers have been..."

www.instagram.com

How WallStreetBets Pushed GameStop Shares to the Moon

Short sellers have been called a lot of things. Bloodsuckers. Parasites. Other words not fit to print. Now in the vortex engulfing GameStop Corp., they have a new name: the establishment.

www.bloomberg.com

“wall street bets trader turns $53k into $11m+”

I’m in the wrong business...

 

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[Ravens_Shadow]

I don’t think this is right man. Those Robinhooders trade with like $60 in their accounts and even buy fractional shares of companies.

 

[NCNY]

There is no such thing as Hedge fund taking risk.
Its hedge fund getting treated by illegal activity.
From a lot of people, yes.
But it doesn't mean its "their risk."

And gov should prosecute those who did this.
Its called "market manipulation" and is illegal.

lol, a hedge fund trying to force a company to go bankrupt that would make all their employees jobless lost billions due to their unhedged greedy bet turned against them, cry me a river

 

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[Guest-5ty5s4]

Wallstreetbets can no longer be accessed on Reddit and their discord was banned. edit: (They're back up)

There it is, the power of hedge funds combined with big tech companies.

We are living in a very strange time.

Don’t you see? The script isn’t just a subliminal thought: it’s written into the laws of the land. The regulators apply the script and enforce the script. You can’t trade this way - you MUST give us a percent of your paycheck for passive stock market gains and a 2% fund fee.

The script will be enforced with an iron fist...

 

[Andrewjgong]

Browsing the WSB subreddit really stinks of scammers.

It reminds me a lot of the "merching clans" from old Runescape. IYKYK

Basically they'd pick a random item in the game and say it was going to go up in value (for no apparent reason) - the "clan leaders" would already have bought thousands of this item, they would just run a pump & dump. The prices do rise, but it's because of the people being duped, not much else.

The short squeeze is a real thing, but overall the reddit sub is a bunch of people scamming each other.

By the time you start asking "why is this guy still holding all his positions when he has so much unrealized profit" it will be too late and they'll be outta there. Lol

edit: I guess "pump & dump" is a foreign concept here.

Never in a million years would I meet someone else on this forum to quote such a small phase that happened during Runescape almost 10 years ago.

 

[csalvato]

Secondly, even if you found an exception didn't mean the rule isn't true. Name five more well run companies that led to hedge funds getting rich by shorting them.

You can make a lot of money shorting any stock, just like you can make a lot of money longing the stock.

It's not even hard if you can manipulate the markets by feeding CNBC whatever narrative you need to push to drive a stock down.

Most hedge funds openly perform market manipulation in this way, to make money on whatever security they think is prone to move based on the news, whether that's Apple, Coca Cola, Tesla or Gamestop.

That didn't work for them.

And... Tesla, while innovative, is not some well oiled machine. It is bitcoin, with a car and a guy named Elon, the way its valued.

Hedge funds almost always short innovative companies of all forms because they are easy targets, because innovation is hard and prone to fail.

Tesla is the most high profile, but not the worst of the lot by any means.

That doesn't mean they are badly run companies.

When you look under the hood of innovative companies that hedge funds have shorted (including Tesla, Facebook, Snapchat, the list goes on), they aren't poorly run, just at an earlier phase of their development.

Hedge fund shorting (especially naked shorting) is a massive, unnecessary barrier to the success of innovative companies, even if they are very well run.

This is one of many reasons why companies that are still innovating are loath to go public. Sure, it's a big payday, but you introduce massive barriers to your own innovation and are often signing your own death warrant.

And, of course it worked for them. I know you're not naive. The money hedge funds make isn't based on aren't opening short positions and holding for infinity. They open the short position, create a rumor, sell the news. It's done within hours or maybe days and the money is in the bank.

 

[theag]

BTC cannot.

Pretty naive. If the government wants to steal your stuff, they will steal your stuff.

I want to believe it, I really do. But I guess I'm just too much of a realist.

 

[BellaPippin]

View attachment 36562

Revolut in Europe casually pulling this stunt! My account is in limbo land now.

(This was a general announcement not a message directed specifically to me)

View attachment 36563

BRO this is on par with RobinCrook. Several class action lawsuits have already been started.

Just .... HOLD.

 

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[lludwig]

@MJ DeMarco you know when you get AOC and Cruz to agree on something, you F*Kd up.

No, when they agree you should hide your wallet. They are about to take something away from you. More than likely your freedom.

 

[AceVentures]

idk if it's because I've spent too much time in Texas, but all of this "they" talk as if "they" is some insurmountable force of nature perplexes me.

Power goes through cycles - and if "they" need to resort to force, "us" has historically found a way to overcome "they".

I'd like to encourage us to stop thinking as if we're powerless.

 

[AFMKelvin]

I think you didn't read my post well. Re-read it.

And to help you understand what I just wrote about, here are some posts under a well-written post in that group. Judge for yourself. There is about 150 more like this...

View attachment 36513

Lol you can't tell this guys are just trolling around? Look how many rockets they post.

 

[BizyDad]

I think you didn't read my post well. Re-read it.

Ironic. I don't think you read @kelvinfernandezm posts well. Reread them.

You are just proving his point. 4chan got a bloomberg terminal. It's reddit, and you're complaining they don't have a culture of bringing value? That's funny.

To trade in the US you need at least $250,000

Where'd this come from?

 

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[Ravens_Shadow]

I think there is a misconception on WSB a bit.

The Reddit community as a whole mostly consists of millennials.

In particular, WSB are much, much smarter than they put on. It's like a bunch of us at a Summit totally cracking jokes and talking shit all while talking about a serious subject lol.

The "bunch of kids in a basement spending stimmy money" actually works in their favor, and was the same thing that totally destroyed Tesla shorters. Under-estimation is quite the edge in a fight. If you don't think some of the PPP or EIDL money hasn't funneled or is inside Tesla stock (or in other stock contributing to the overall equity market exploding), then you may want an awakening, and I don't think kids in a basement are doing that.

Honestly; I think the "kids in their moms basement" narrative was dropped by the big guys awhile back when they realized it wasn't.

What I like about WSB is that their BS filter is on another level, and things will get called out for what it is and ain't very fast.

With all that said....

THIS IS A.... MOVEMENT. NEVER go against a movement lol, as its one of the most powerful things in the world. I think probably most of us here would like to give a huge middle finger to the big guys.

Although it is and will be a pump and dump when its all said and done; the mechanisms of it is extremely unique and never seen before.

Most think; these WSB guys will fall flat on their face.. will they though? I mean, to be honest; most of these guys got in around $30-50. Yes, you see lots of comments about $100-150, but even then; when this things goes to $1k.. Do you think the guys with $150 entries are the ones falling on their face?

Or will it be the media-induced greedy non-WSBer coming around trying to get in on the action buying in at $500+?

The scary part on all of this and "The Movement"? Its exposed something that can be replicated toward other highly short floated stocks. (*achem* AMC. disclaimer: I am balls deep in that from an earlier entry).

Mob Mentality: During a riot; once they see that they can burn down a building and it went successfully; they go to find another building.

Use smart stops, move them up as things move up, learn to get out when you hear average Joes actually buying the hype (and not just talking about it) because their stupider neighbors are richer cause of it, and learn to pull profits on the way up and can say "ah shit, should of held... oh well" as you turn around to smash a Pro V1x down a fairway from your new Taylormade driver.

Then you'll do fine in any bubble. The most gains are in the last stretch anyways.. and we are at the Belief stage where the doubters actually give in and "believe" and put their money in. Then Thrill, then Euphoria. Then GTFO lol.

Rinse, repeat.

$1k. then AMC.

Bought 40 shares of AMC for the lulz. Lets see if i lose the money or not. I'm one of those damn robinhood traders i guess.

 

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[James Fake]

There are more backups of WSB in many more places than the public knows of.

In other news;

AMC was able to cash some of their stock and now can successfully pay their rent, employees, etc. through 2021 and will be able to weather the storm. Essentially; a crowd sourced driven PPP to them. And good for them. 300% made shorts cover freeing up billions for them to pocket it for good use; and the early people like me believing in the Cause cash out from that same billion(s) in tremendous profit. And the late comers trying to make a quick buck, greed and piggy backing usually don't end very well in any aspect of life.

Eyes are set on a select group of other stocks.

Tomorrow will be another book for history.

Tip: Belief and Entry is where the money is made. If you do; you'll know where things are headed next. If you're looking to make a quick buck, you better make it with quick in and out's before that blade comes down.

 

[WillHurtDontCare]

Robinhood just dug its own grave. R.I.P. Robinhood.

A massive boycott movement has begun.

It's amusing that a company with the name Robinhood sided with the rich against the little guy.

 

[AFMKelvin]

Based upon this alone, this will not end well. This poor sucker will get burned... badly.

So one wrong deserves a 'right'? Let's assume Melvin did wrong and did manipulate the markets (which by the way is much harder to do when shorting since it's asymmetrical but let's forget that for a min).

So is the answer is that short-sellers shouldn't exist? Is this their solution?

If you think this you are deluding yourself. Short selling serves a very important purpose in price discovery.

This person's response is the 08 collapse was because of Wall Street... So therefore Wall Street must pay for its actions? Where was government and FED policy in any of this? What about individuals who overleverage themselves with loans? Not one single peep about those problems.

This is shortsighted at best, stupid at worse. Not understanding the larger picture of economics and how capitalism works... but hey this isn't a surprise with the demographic making these claims.

What they are doing then isn't itself market manipulation? This is the typical self-righteous bullshit that people use to justify their own wrong actions.

"I'm robbing a bank because the banks lie, cheat, and steal..." please!

Ok boomer. You're mad about reddit users "manipulating the market" but are so blind to the fact that this hedgefunds are also manipulating the markets and have been for decades through mainstream media. It's so obvious now. The fact the most popular stock exchanges are freezing the buying of the stocks talked on WSB should tell you how much they manipulate the market. Also all the headlines online are loaded trying to make it appear that what WSB is doing it's illegal. Boomers like you need to wtfu.

 

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[BellaPippin]

Robinhood just dug its own grave. R.I.P. Robinhood.

A massive boycott movement has begun.

Incoming class action suit. DISGUSTANG what RH did.

 

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[ljean]

The only thing that can make gamestop go under is their irrelevant business model.

 

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[PapaGang]

Now I trade purely based on current mathematical conditions. And it has served me wonderfully because it has stripped out the emotion, the commentary, the biases, the memories, the opinion, and the noise.

Listenin to MJ now, dumped my GME stock and bought Blockbuster!



Wait, maybe he meant... ?

 

[MJ DeMarco]

Well hey, would you look at that, they got AOC and Ted Cruz to agree.



Via

GameStop, Market Distortions, and Manipulations | Mises Institute

With a sound money, none of these distortions would have been possible: the limitations of the currency itself would have forced an unwinding of excessive risk

mises.org

 

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[AFMKelvin]

I would be happy, if someone could explain to me in the easiest words as possible.

The only way I can explain to you what's going on is that meme magic is real.

 

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[Kak]

I can't get in the head of the people who insist on using Robinhood when TD Ameritrade, Fidelity, and JPM all offer zero commission trades... Between crashes, shutdowns and the stupid socialist name, Robinhood is an absolute joke of a trading platform.

 

[MTF]

how duress wallets totally circumvent being held at gunpoint for your keys.

Checked it out of curiosity:

Duress PIN​

We provide an optional "duress PIN code". If you enter that PIN code, instead of the "real" PIN code, nothing special is shown on the screen and everything operates as normal... However, the bitcoin key generated is not the main key. It is effectively a completely separate wallet!

To take best advantage of this feature, you should put some Bitcoin into the duress wallet. How much you are willing to lose or what you need to make it plausible, we don't know.

The "duress" wallet will still be derived from the original BIP39 words, so you don't need to back it up separately, but there will be no way to get from that wallet back to the original wallet with the real funds in it.

Gotta applaud the innovation.

 

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[csalvato]

Again, missing the point. They can seize you! They can fine you, arrest you, and tax you. Your wallet can be more than protected no matter the means. Direct or subvert, but it doesn't matter.

No, you’re missing the point because you’re acting closed and narrow minded.

The risk of such persecution is small, and also it’s a risk worth taking.

If you want to live your life in fear of economic persecution and don’t think that standing up for liberty may be worth jail time or death, that’s fine.

I do.

The only way someone will get me to give my keys is to hold a gun to the heads of my kids, and if that’s happening, we have far greater problems on our hands than bitcoin being illegal.

 

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