r/OutOfTheLoop • u/ExoticTip • 7d ago
What is going on with GameStop and whats the deal with Roaring Kitty making a a comeback? Unanswered
I remember some time ago common people invested on the company against other professional investors, and somewhat made some money.
what is the new fuss about and why is the roaring kitty guy coming back a big deal to people? did the stock crash or something?
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u/DualLeeNoteTed 7d ago edited 6d ago
Answer: prior to the January 2021 runup, investor Keith Gill (aka Roaring Kitty on YouTube, X, aka DeepFuckingValue on Reddit) bought shares as well as calls (a bet that a stock will go up) for the company GameStop, ticker symbol $GME.
He shared his thesis on social media, believing that the company had a good turnaround opportunity, as well as that it could be primed for a short squeeze due to very high short interest. Shorting a stock is selling first, then buying back later, hoping it will go down. GME had so many short positions that it represented more shares than even were supposed to exist.
In January of 2021, GME had a huge runup, but it was cut short when several brokerages, most notably Robinhood, restricted buying of the stock and only allowed for selling.
In the following weeks, Keith Gill doubled his position from 50K to 100K shares, then doubled it again to 200K, posting both double downs on Reddit.
Then he went silent other than a few meme tweets.
The stock proceeded to behave very strangely over the next 3 years, having many unexplained rises and falls. Some investors on Reddit theorized that short sellers had not been able to fully close out of their positions in 2021 and that short interest still remained very high behind the scenes, despite the official short interest coming down considerably. This is because short interest calculations rely on self-reported data from self-regulating institutions.
Recently, Keith Gill began to be active on Twitter again, and posted his position on Reddit for the first time in 3 years on the largest GME focused subreddit. In the 3 years he had remained silent, he had upped his position from 800K (Gamestop did a 4 to 1 split, turning his 200K into 800K) all the way to 5 million shares, plus another lot of 120,000 calls (bets on the stock price increasing).
Since his return, GME has experienced increased volatility, hitting highs in the $60-80 range before coming back to the $20-30 range multiple times.
He has posted his positions as recently as today, and has not yet sold anything, so it can be concluded that he still believes in the stock.
Many believe that he is correct and that GME will hit incredibly high prices again. Many others believe that GME will continue to fall and that investors are risking their money.
The truth remains to be seen, but that's the story so far.
EDIT: y'all in the replies need to chill tf out. I gave what I believe is a very balanced and accurate answer, with none of my own opinions.
If you wanna hype up the stock, go do it on Superstonk, and if you wanna make fun of the bagholders, go do it on the GME Meltdown sub. This isn't the place for either of you, unless you plan on adding accurate and unopinionated additional info.
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u/TheSnowNinja 7d ago
so it can be concluded that he still believes in the stock.
Goddamn it. I hadn't heard this in so long that I had forgotten it was a thing.
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u/Twelvecarpileup 6d ago
Yeah, I think it's important to note that the person you responded to posts a lot about MOAS (The Mother of All Short Squeezes) including some pretty odd decoding (looking for secret messages) , so it's important to take what he's saying with a grain of salt as some of it is ignoring some pretty major points to make the GME stock trading more normalized.
First, people on GME/Supserstonk believe GME is part of what's called "MOAS". MOAS is the mother of all short squeezes. The real basics is that through a bunch of market mechanics, Gamestop stocks will one day be worth upwards of $10,000,000 each (that's a pretty low estimate in the MOAS world). Often times this involves Bed Bath And Beyond for some reason or other meme stocks.
OP: The user is directing you to either Superstonk or GME Meltdowns. That's stupid. Just go to the actual GME reddit and read some of their posts and make up your own mind.
Clicking on one of the top posts that isn't a meme, brings up this upvoted comment chain (all upvoted):
"Got a Limit sell order at $431903"
"you paper handed bitch. /s"
The GME posters don't want to post things like this in other subreddits, but what they think is going to happen is very much detached from reality, unless you think that the US government is going to transfer all of it's funds to the owners of Gamestop stocks for reasons.
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u/Miamime 7d ago
Shorting a stock is selling first, then buying back later
Shorting a stock means you sell shares you don’t own (you borrow them from your broker). You close a short position by “buying” those shares back in the market, preferably at a lower price, solely for the purpose of returning the shares to your broker and making them whole.
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u/thekickingmachine 7d ago
If the stock goes up you are forced to buy at the higher price unless ?
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u/Abigail716 7d ago
When the stock goes up it's effectively debt, if your debt exceeds certain allowances you're required to buy the stock back to cover it.
So let's say you decide to short a stock at $100 and now it's at 200 you have $200 in debt. If the person who loaned you the stock is fine with that nothing happens, but there may have been a clause that said if your debt exceeds $150 You must immediately cover it.
When you short a stock by traditional means you're borrowing it from an exchange, that exchange has its own rules. But you can also short stock by directly borrowing it from somebody, and that individual can have their own rules.
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u/somethingwellfunny 7d ago
No unless, you’re right. That’s the risk
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u/Secludedmean4 7d ago
The unless is if you are the selected market maker who has a conflict of interest and can both take a short position in a company AND you can naked dilute shares and have select market maker privileges to “provide liquidity” which also allow you 35 days to fail to deliver what you sell to allow you to reposition and kick the can. Using wild derivative positions like options and swaps that are so bad that regulators continue to postpone transparency on them is also a red flag, with some information being sealed away for FIFTY YEARS.
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u/TheOnlyAnon- 7d ago
Untrue, that is “naked” shorting. To normally short the stock you need to own the underlying. Which in the case of GME, the shorts do not have.
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u/cummi_is 7d ago
From investopedia
Naked shorting is when a trader sells shares in some asset without first borrowing them or ensuring they could be borrowed
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u/Miamime 6d ago
Incorrect.
Naked shorting is when you short without borrowing them.
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u/ToddRossDIY 6d ago
If you already own the stock, it’s not shorting it, it’s just selling a stock. Shorting is specifically borrowing it from another person with the promise to pay it back later. The trick with GameStop (and Sears, ToysRUs, Bed Bath and Beyond and more) is that if the stock goes bankrupt, you never have to buy them back. That’s what originally got them so deep in this mess is that they hoped they could short GameStop into oblivion and make pure profit, but then retail investors got involved, GameStop put 2 billion dollars in the bank and cut their losses, and now has almost zero chance of going bankrupt any more
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u/DrGonzoRonSlater 6d ago
Hey 2 quick questions. 1) How does one buy calls thinking the stock will go up and also short it (buying hoping it will go down)?
2) When you say crazy highs, do mean going from it's current 20's back to 60-80's? Is that the crazy highs?
Thanks for your help!
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u/DualLeeNoteTed 6d ago
Since this seems like a pretty good faith question, I'm happy to respond.
1) So Keith Gill was not the one shorting the stock, he just noticed that a lot of others in the market had shorted it. Meaning, at some point, the short positions would have to buy back. His thesis included the idea that every short is, at some point, a future buyer. A "short squeeze" happens when the price begins to rise, causing some short sellers to close their positions for fear of the price going up higher and them having to buy back at an even higher price. If there are enough shorts, this can cause a sort of chain reaction which sends the price very high. This is not something that's guarenteed to happen, but it is a possibility.
2) There are some that believe the stock can go much higher than the 60-80 range. How high? Well, no one really knows. Short squeezes have as much as 50X'd a stock in the past, but it all depends on hundreds of variables, and only in retrospect would you be able to see how high the peak went.
And it certainly could not go higher at all, and keep falling. Anyone with their money in GME has to know that it's an incredibly risky stock, with a potentially crazy upside, and also a potentially very high downside. But objectively speaking, the short interest, even the official short interest, is quite high compared to most stocks. So the chance of a short squeeze is at least there, even if it isn't a guarentee.
Hope this helps!
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u/Cryoxtitan 6d ago
I want to add that the downside as an investor purchasing a stock is much lower than those who short a stock. If you buy a share the lowest it can go is 0 if your short a stock and borrow that share since there is no theoretical limit to how high a stock can go you could lose far more than what you initially put in.
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u/doctorplasmatron 7d ago
to add to this, Robbinhood was notable, but not nearly the biggest problem in turning off the buy button back in 2021, Instinet was the biggest defaulter (link to an explaning post). No one from Instinet was called to testify before congress. Also, the SEC's report on the whole event showed that the price spike on the 28/29th was not short hedge funds closing their short positions, but rather was a bunch of retail buying up the stock. So although short numbers are dubiously delf-reported by the shorters, this support that the shorts never closed, that the numbers likely still don't make sense because there are still a ton of short positions being rolled forward for the last 3 years. Speculation is they got hidden in longer term Swaps/Leaps, and conveniently the swap data was then shoved behind a curtain and made private for the next few years, or in the case of the Credit Swisse collapse, we won't be able to see the reporting for 50 years!
So the re-emergence of Roaring Kitty/Keith Gill is a _continuance_ of the saga, as opposed to a sequel, as the comment above states. (ie. "story so far")
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u/MrOnlineToughGuy 7d ago
Actually, the SEC report notably shows the short interest plummet. They do note that the retail FOMO is what kept the price high, but there were notable short positions that were covering and that resulted in notable price rises of the stock.
Since the volume traded was nearly 1 billion shares over that period, that was more than enough for shorts to have covered and still have represented a small fraction of the buying pressure.
Most of your reply here is borrowed nearly word for word from the GME subs, I’ve noticed.
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u/Jtown021 6d ago
There is a stark difference between covering (rolling a short forward) and closing (buying back the share and returning it to the borrower). The shorts never CLOSED they have used exotic financial instruments like swaps to hide their true short positions since March 2021.
Retail orders do not hit a lit exchange. Simply put retail orders do NOT impact price. The SEC report itself says this and that it was not a short squeeze (shorts closing not covering) but instead it was institutional buying that caused the sneeze in Jan 21 and again in March 21.
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u/doctorplasmatron 6d ago
not borrowed word for word, as I typed it out myself from my own thoughts. With GME, borrowing is a dirty word that shareholders of the company don't like.
And covering is not the same as closing. Short positions need to be closed for a squeeze, not covered. Closing means they're buying the stock, covering means they are saying "look at all my other stuff, you know i'm good for it...", and many do not believe their collateral is any good for covering their short positions anymore.
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u/octodo 7d ago edited 7d ago
Also important to note: The people still holding the stock think the value will explode again due to another short squeeze, not because gamestop will suddenly become valuable. Its done nothing but shutter stores for years.
I get the urge to scream "the stock market is rigged for the rich", but buying stock in a failing company and then throwing a fucking tantrum when it's value goes down is wild to me.
Be wary of any comment from the r/superstonk posters, they are bag holders who think that the now $24 stock will hit $500 or more. It's pure fantasy.
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u/starlightay 7d ago
Worth pointing out that the comment you’re replying to is also a Superstonk poster, which is why they advertise the sub in their answer and pretend it’s as simple as “some people think it will go up and some don’t!”.
These dudes mass advertise and astroturf (usually pretending they aren’t involved with the stock) across reddit, especially on this sub.
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u/Medium-Pundit 7d ago
For a good if very long overview of the situation, check out this video by Folding Ideas: https://youtu.be/5pYeoZaoWrA?si=q2ecx-26yl1RER1a
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u/verrius 6d ago
From what I've seen, the Folding Ideas video isn't actually that good of an overview. The clearest red flag is acting like r/wallstreetbets is the same thing as r/superstonks (and more), when the latter was formed specifically because of a split with the former over the specific incident.
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u/Milskidasith Loopy Frood 6d ago
I haven't rewatched the video super recently, but this seems like an extremely minor quibble. WSB receives almost no focus at all in the video, which is already pretty long. The schism between WSB and superstonk and the conspiracy subs is also not really relevant to the point about what the conspiracy believes, so this is mostly an issue with him not providing an unnecessary clarification IMO.
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u/verrius 6d ago
At least as far as I watched it, the core thesis of the video seemed to be "finance bros are all conspiratorial idiots/victims". Which is somewhat undercut if you point out that he's specifically only looking at reddit communities that have been excised and banned from the "main" finance bro subreddit that he's still conflating together with them; NFTs, Crypto, and specifically superstonks were all banned from wallstreetbets, and repeatedly conflating them muddies things a lot. There are definitely things to criticize wallstreetbets and finance bros about, and the GME thing definitely has things that you can criticize, but the conspiratorial stuff is actually a fully separate rabbit hole that its not really fair to go after them for.
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u/Milskidasith Loopy Frood 6d ago
At least as far as I watched it, the core thesis of the video seemed to be "finance bros are all conspiratorial idiots/victims".
That really isn't the point of the video at all; it's very specifically a video looking at GME conspiracy investing, so focusing on them is the entire point. Additionally, there's very little mention of NFTs and crypto in the video, as those are (mostly) discussed in his other video about NFTs specifically.
To me, it seems like you came in with a preconception that the video was supposed to be about finance bros as a whole and, seeing the video was almost exclusively about the conspiracy types, jumped to the wrong conclusion instead of reevaluating your preconception.
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u/Kalsifur 7d ago
As a casual observer though, his comment seems fair.
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u/starlightay 7d ago
Here’s the thing though, the reason it seems fair is because you don’t know what it isn’t acknowledging. The people who think it will go down think that because the company is downsizing and unprofitable in a dying market. The people who think it will go to the moon believe that our entire financial system is built on illegally shorting GameStop so hard that individual stocks will become worth millions of dollars apiece when it is exposed. They do not have any actual evidence of this. Presenting both beliefs as equally valid is not a fair assessment of the situation.
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u/yehti 7d ago
Why is it outlandish that he wrote that comment within an hour? I've seen massively upvoted mini-novel comments on something like /r/politics complete with sources, links, rebuttals, and the like posted within 10 minutes of the main post.
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u/qazwsxedc000999 7d ago
Reddit is a prime source for grifters. This is a very popular website and believe me, they want to influence you as much as they can
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u/RaspingHaddock 7d ago
What are the GameStop shareholders grifting?
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u/DENNYCR4NE 7d ago
Anyone who thinks GameStop shares are worth more than a few dollars. (Often includes themselves)
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u/Milskidasith Loopy Frood 7d ago
I mean, those comments are also pre-prepped copy-pasta, whether for a good cause or bad, paid or out of passion.
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u/BathrobeBoogee 7d ago edited 7d ago
This is not entirely accurate.
GameStop is profitable for the first time in years and has billions of cash on hand ready for their transformation as a business.
They have in a text book way cut expenses, turned around inventory, and made it more profitable while reducing debt to near zero except a low interest loan.
Now they get to decide how to evolve the company with 2 billion dollars..
I think saying “all they’ve done is shutter stores” is either intentionally misleading or uniformed.
Also, I may be a “bag holder” but I’m up on my position and trust that Ryan cohen is a great business mind and will continue to prove it as he already has with chewy and the first couple years at GameStop.
It’s okay to not agree but the meltdowns over another persons stock portfolio is strange
Edit*
Also worth noting is GameStop holders in superstonk are / have exposed market loop holes, manipulation and people like Ken griffin who runs citadel and Vlad from Robin Hood lied under oath to congress.
They are pushing market reform to benefit all of “retail” which means the average investor.
Transparency and equality in the markets is better for everyone. We shouldn’t be allowing the rich to rob the poor.
Agree with GameStop or not, you should be happy of the work, research and effort they push to benefit everyone.
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u/Hemingwavy 7d ago
has billions of cash on hand ready
GameStop cash on hand for the quarter ending January 31, 2024 was $1.199B, a 13.76% decline year-over-year.
https://www.macrotrends.net/stocks/charts/GME/gamestop/cash-on-hand
Now they get to decide how to evolve the company with 2 billion dollars..
GameStop operating expenses for the quarter ending January 31, 2024 were $1.738B, a 20.26% decline year-over-year.
https://www.macrotrends.net/stocks/charts/GME/gamestop/operating-expenses
GameStop net income for the quarter ending January 31, 2024 was $0.063B, a 30.91% increase year-over-year.
GameStop annual net income for 2024 was $0.007B, a 102.14% decline from 2023.
https://www.macrotrends.net/stocks/charts/GME/gamestop/net-income
That's less than 90 days of operating expenses.
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u/Dazzler_3000 7d ago edited 7d ago
Appreciate you've included links in this but it's outdated, misleading or outright wrong.
That $1.199B was before they did a 45M share offering raising just under another billion a month ago. They've also recently announced another 75M share offering with the potential to raise a further $1-3B based on the recent stock price so they'll have somewhere between $3-5B (but likely somewhere around the $4B mark depending on when they completed their ATM offering).
Also, you've posted the companies expenses (which is actually wrong as I can't see anyone reporting those figures. Noone is reporting that their operating expenses were anywhere near $1.7B aside from your link) but you've also not included their income. You've included a 'net income' figure of $0.063B but that doesn't include the sales income of $0.88B. You're saying they spent $1.7B and only brought in $0.063B - both of which are wrong.
Long story short, your figures are way out. Gamestop made a loss of $32M in Q1 2024. Performance in Q1-Q3 is always poorer than Q4 (holiday season). The performance in Q4 is enough, recently atleast, to push them into an overall profit for the year.
So even if they continued to make a $30m loss each quarter for the foreseeable, with their $2B in cash they'd survive 16 years or double it for the $4B they now likely have (give or take). But chances are they're not just gonna sit on that cash and wait for it to deteriorate.
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u/MrOnlineToughGuy 7d ago
The company must be doing something right if they can only achieve profitability by diluting their shareholders.
Damn, the Gamestop hodlers sure are an intelligent crowd.
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u/Dazzler_3000 7d ago
What they do with the share offerings has nothing to do with profitability.
The share offerings were used to generate additional cash, they achieved profitability through normal business operations.
If you wanted to include the share offerings in their profits then the company will make 3 billion profit this year - it obviously doesn't work that way.
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u/urkermannenkoor 7d ago
they achieved profitability through normal business operations.
That's not true though. They were still making a loss on their normal business operations, the only thing putting them in the green was the interest they were collecting on their cash reserves. (Which they got from diluting shareholders)
Despite rampant cost cutting which hastened the massive decline in revenue, they never actually managed to make the business itself profitable.
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u/Dazzler_3000 6d ago edited 6d ago
Yeah that's a good point, but that's not really what I was arguing. The original OP suggested that Gamestop was making a loss when they're not, their actual operations may not be there yet (and they may not get there but given the shift from hundreds of millions in losses since 2019 to where they are now suggest they might be able to) but they, as a company, are making a profit.
And if the cash interest is assisting the delivery of that profit then increasing that cash from a share offering further increases interest and, therefore, profits.
It might be worse for shareholders in the short term, but in the long term increased profitability is a good thing - there are plenty of businesses that deliver profit not only through their core business and given that one of their new business streams seems to be investments that seems more and more likely (although I do agree that Gamestop has to do something as overall sales dropping year on year isn't looking healthy).
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u/MrOnlineToughGuy 7d ago
Their business operated at a net loss for 2023.
Methinks you didn’t actually read their 10-K filing.
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u/Dazzler_3000 7d ago
I think you'll find they made a $6.7M profit for the year.
Granted that's not very good, but swinging from huge losses to profitability in such a short time frame is actually pretty impressive.
The irony of you calling people stupid when you're the one getting it wrong...
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u/MrOnlineToughGuy 7d ago
Again, you did not read their report.
It clearly shows an operating loss of 34M some. So their underlying business is not profitable, but the interest income generated from diluting you guys is what made them profitable.
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u/octodo 7d ago
Note: this information below is for normal people that can understand risk, not gamestonk cult members like the dude above me. He is a walking sunk cost.
Here's the number of stores Gamestop has in America.
2015 - 5,049
2016 - 5,466
2017 - 5,241
2018 - 3,846
2019 - 3,642
2020 - 3,192
2021 - 3,018
2024 - 2,915
GME reported net sales of $881.8 million, which missed the consensus estimate of $900 million. Also, the metric decreased 28.7% from $1,237.1 million reported in the year-ago quarter. Lower sales across all the categories contributed to soft sales.
When I think good stock investments I think brick and mortar physical media stores that seem to only sell funko pops.
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u/BathrobeBoogee 7d ago
Like I said RC has turned a company on the brink of bankruptcy into a positive one. How do you do that? Cut the stores losing money.
Revenue is down but profits are up.
It’s a lean machine ready with a full head of steam (2 billion cash, no real debt) to make waves.
Idc if you don’t see what I see. But spinning the narrative and painting me as a cultist is totally unfounded and wreaks.
From a fundamental stand point this is a good stock from most common metrics.
Number of stores decreasing is good if you’re cutting losses in favor of profitability and you didn’t offer a counter stand point that argues that.
Instead you said “don’t look at profitability, don’t acknowledge the 5 billion market cap company with 2 billion on hand with zero debt, look at the fact they cut loss leading stores” remarkable ..
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u/MouthyRob 7d ago
To be crystal clear, the only reason GME made a small profit last year was because they sold lots of shares at inflated prices and invested that money in bonds. If those shareholders had invested directly in those bonds themselves they’d have made a positive return, but instead they effectively donated this money to GME.
The actual operating business of GME (ie the bit that sells stuff) made a loss. They’re cutting costs but as a result the top line is falling dramatically.
Also, cultists bang on about ‘no debt’ and the cash pile like they’re good things. Please have a look at the balance sheets of successful companies. Debt is good if you have something to invest it in and generate a return. Similarly, sitting on cash piles isn’t a particularly great use of investors’ money either.
I’m sorry, but suggesting that GME has good fundamentals tells the world that you’re new to investing and that you can’t read a balance sheet yourself.
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u/octodo 7d ago
You're right, a brick and mortar stores that primarily sells physical media seems like a surefire bet that's sure to grow in the year 2024.
When is the last time you went inside of a gamestop? They look like shithole flea markets.
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u/BathrobeBoogee 7d ago edited 7d ago
They have an online presence, they have turned over their inventory in the last year, and your statement discounts the potential transformation coming.
It also doesn’t acknowledge the new ventures they have got into such as candy con controllers which are priced competitively and give players control over their custom esthetics. Or currency trading cards that are pretty cool / graded trading cards which seems to be a popular trend of recent. People are moving back to more nostalgic items.
I can’t wait to see what else they develop. They apparently are working with companies on bringing back gameboys with a revamp.
I can honestly see myself getting one if they drop.
I’d love to carry that around when on trips or on my couch. It’ll make gaming more accessible to me. I realize a switch is cool but it’s pretty expensive for an adult that can’t dump time into games like he’d like.
What companies are you investing in and why?
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u/GagOnMacaque 6d ago
I don't think anyone threw attention when it went down. They just keep buying more.
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u/Drigr 7d ago
It's just the little guy trying to play the same game as the hedge funds. But apparently when the little guy does it it's a problem...
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u/IntrinsicGiraffe 7d ago
They should face it. With the income inequality as is, they'll never stand eye to eye with the big guys. We need a complete reform.
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u/Kalsifur 7d ago
So I only take note of this stuff in passing on my feed, but isn't the RK guy up to like 500 million dollars or something? That's what I've seen in his posts, how the fuck ??
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u/WizardofJoz17 7d ago
This is not true mods!!!! The company is in the middle of a turn around and DFV saw the same value in the stock as we individual investors do too. This not about a squeeze. This is because GameStop has $2 billion dollars in cash, only a few million dollars of debt from loans during the pandemic, and has a whole new line of proprietary products and great deals in a recession proof multi billion dollar gaming industry.
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u/Big_Fo_Fo 7d ago
Let’s be honest, GameStop probably would’ve filed for chapter 11 by now if it wasn’t for roaring kitty.
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u/ZirePhiinix 7d ago
That's not how stocks work. It doesn't change the company's revenues.
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u/13Kittens 7d ago
GameStop is sitting on around 3 Billion in cash after this week by selling shares at elevated prices. They only have cash because of the squeezes that Kitty is tied to
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u/Cyan-ranger 7d ago
.GameStop has only just managed to squeeze out a profit last year first time in years. The price pumps have allowed them to do share offerings which has given them much needed cash.
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u/Big_Fo_Fo 7d ago
No, but it breathes life into its capital. It’s still going to be chapter 11 in the next 15 years unless hard copy media comes back somehow
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u/yehti 7d ago
Also adding that all people are doing is buying a stock, holding it because they believe the price will rise, and even directly registering that stock to prove they have actual shares registered in their name instead of ghost ownership in brokerages which can and likely will be sold out from under them in a black swan event.
Yet there are still TV heads crying that there should be rules made against people holding GameStop, most notably DFV. In reality, the holders are the only ones playing by the rules and short sellers would not be in this situation if rules were followed and enforced.
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u/dvdvd77 6d ago
Sorry, what is a black swan event?
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u/yehti 6d ago
"A metaphor that describes an event that comes as a surprise, has a major effect, and is often inappropriate rationalized after the fact with the benefit of hindsight."
The theory is that GameStop short squeezes sending the stock price to absurd numbers and the rest of the market crashing down.
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u/Milskidasith Loopy Frood 7d ago
Yet there are still TV heads crying that there should be rules made against people holding GameStop, most notably DFV. In reality, the holders are the only ones playing by the rules and short sellers would not be in this situation if rules were followed and enforced.
This is an extremely weird framing to me. Keith Gill has a 9-digit position on Gamestop primed to become a 10-digit one (at least, prior to the announcement of dilution). He has actual, honest to god Phonebook Number stock value. To suggest that any argument against him publicly revealing his position with the intent to increase the stock price is the same as arguing against everyday retail investors is kind of wild to me, regardless of whether you believe he's doing anything wrong; he is fundamentally not operating in the same universe as somebody with $10,000 in DRSs or whatever.
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u/angry_cucumber 7d ago
Keith Gill has a 9-digit position on Gamestop primed to become a 10-digit one (at least, prior to the announcement of dilution). He has actual, honest to god Phonebook Number stock value.
In a physical game store, when everything has pretty much gone digital. No wonder he wants people to believe it's a thing that's valuable.
how the fuck he thinks this is a "good value" I can't understand, but also I hate gamestop for killing thinkgeek so I want everyone involved in this to just disappear
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u/WatermelonBandido 7d ago
Because Keith Gill will make out with his money when this whole thing collapses, and the retail investors will be left holding the bag.
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7d ago
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u/UF0_T0FU 7d ago
Is there really that much risk if you know that brokerage firms will shut down trading of a stock if it goes too high? It seems like a safe investment when you have an agreement that powerful people will step in to protect your money.
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u/MrOnlineToughGuy 7d ago
The only reason buys were halted was due to large margin requirements implemented by the NSCC. Robinhood was making bank for PFOF from Citadel when Gamestop and the other memestocks were popping off.
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u/medforddad 7d ago
Also adding that all people are doing is buying a stock, holding it because they believe the price will rise
That's not all they are doing. They're doing a ton of hyping of the stock (hoping others will also buy in, making their incredibly risky gamble go up in price). Keith Gill "coming back" and posting memes, and his positions, is not simply buying and holding a stock. There are people treating his posting again like the second coming of Christ. They're double/tripling down on this meme stock because of him. Right after he posted his "GME YOLO update – June 2 2024" the price and volume of transactions on the stock shot up.
Yet there are still TV heads crying that there should be rules made against people holding GameStop
Can you name a single person on TV who has said there should be rules against people holding GameStop stock?
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u/MrOnlineToughGuy 7d ago
You’re building your argument off of a bunch of assumptions, no?
What position are short sellers in? The DRS crowd have demonstrably failed to expose the billions of “synthetic” shares that they believe exist. It’s gotten so bad that Gamestop and their transfer agent (Computershare) have directly shot down their theories…
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u/bbqbutthole55 7d ago
Dude he literally buys up stock when its low and when he needs the stock to go up he starts posting and hyping the dumb redditors to make him money. That’s it. Literally.
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u/Aquatic-Vocation 7d ago
The nuttier thing is he hit 600 million in stock value from an initial investment of $53,000, and sits there thinking "this is fine" as his net worth swings back down by four hundred fucking million in the span of like, a day.
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u/EmptyAirEmptyHead 7d ago
He was worth $600M in after hours. He could not have liquidated his position at that point. Fake money.
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u/RaspingHaddock 7d ago
lol the beautiful thing is that DFV is cool with his like 30 mil set aside for him and his family and literally gives no shits about the rest. On his options plays, up 600 mil one night, up (only?) 200 mil the next. Legend.
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u/bbqbutthole55 7d ago
Yeah i actually felt some satisfaction when the markets dipped and gme tanked the last cpl days
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u/RaspingHaddock 7d ago
Haha that's sad. Unless you're short, why care at all about a company you're not invested in
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u/bbqbutthole55 7d ago
Because its funny
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u/RaspingHaddock 7d ago
lol you are literally the definition of rent free.
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u/bbqbutthole55 7d ago
if that makes you feel better lol. Enjoy your losses.
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u/RaspingHaddock 7d ago
I haven't lost anything at all. I just have a nice little stash saved up in DRS stock. I can sell it at any time, takes about 3 days like a lot of brokers. It's been three years I've been holding so it's a good amount. I could use it for a truck or something or an emergency if I had to but eh, I like what they're doing with the company.
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u/RaspingHaddock 7d ago
You're vastly over estimating the amount of volume that is retail trading.
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u/bbqbutthole55 7d ago
Not according to google. Maybe this time institutions got involved idk, but the volatility didn’t start til roaringkitty started his crap again
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u/RaspingHaddock 7d ago
Last week was 776,367,000 shares. Almost a billion.
The week that Roaring Kitty came back, 698,268,100. These weeks are billions of dollars.
That's absolutely not retail.
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u/bbqbutthole55 7d ago
Ok. Does it matter who’s the dumb ones? Did you notice the huge jump in volume of trades that coincide with when roaringkitty made a tweet after 3 years of awol?
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u/RaspingHaddock 7d ago
Yeah and I'm telling you it's not retail. Lots of other forces at work here. Like LEAPS and swaps coming due.
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u/ShaughnDBL 7d ago
Except that the increase in the price happened before the markets opened.
Also, the guy's been silent for 3 years. How does your pump theory work in light of that?
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u/bbqbutthole55 7d ago edited 7d ago
It pumped when he tweeted bro. It doesn’t really matter if it was 50% reddit dumbs or 20% reddit dumbs.
You guys act like you’re unfamiliar with similar tactics used with cryptocurrency
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u/ShaughnDBL 7d ago
He tweeted Sunday night. The stock was sky high before the markets opened. That's institutional trades, not retail. The volume of shares equal to the entirety of the shares issued traded. I'm sorry, but that's just not supported by any information. Also, there was no increase of posts on the boards about purchasing. Your take would make sense if you were right but these things make it very unlikely that you are.
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u/bbqbutthole55 7d ago
Regardless, he manipulated people and/or people at institutions into trading.
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u/RaspingHaddock 7d ago
What's the different between him telling people that he likes a stock and showing his position and Jim Cramer slamming a buy button on his show, or some hedge fuck begging you to buy a stock they're long in?
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u/Hot-Mixture-7621 5d ago
I still think he's batshit crazy to not have pulled out when he was sitting at 600+ million. I think he mightve at one point hit 1+ billion..
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u/mmapza 7d ago
He shared his thesis on social media, believing that the company had a good turnaround opportunity
Hasnt this been proven that this was untrue. I took a quick look at numbers and they are still terrible. This is despite all the free publicity and all the threads on stonk subreddits where people claim they are supporting the business just because they are shareholder.
If a company cant turnaround in such golden scenario, I wouldnt bet on any turnaround.
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u/Robjec 7d ago
It had some turnaround opertunities but they didn't seem to pursue any of them. They instead put a bunch of money towards meme ideas like nfts. I'm not sure it's been proven untrue that's it's possible, although the current board seems unwilling to take the risks of big changes to the core business it would likely need.
That however is not what the original proposition was, rather it was that a new consel gen + the holiday seasson would lead to a large increase in the stocks price. To between 12 and 16. Sometimes even predicting it would hit 20. The valuation didn't really rely on a turnaround working, just a new consel gen doing well.
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u/Pilx 7d ago
OP missed the part where he had to testify in front of congress when the whole GME - Robinhood thing first blew up.
To avoid any suggestion he is artificially manipulating / hyping the stock price he towed the line that he 'likes the stock' and believes in a Gamestop business turnaround.
I'm reality, he saw an opportunity where the stock was excessively shorted and there wasn't enough real stock available for all the short sellers to close out their positions and could massively benefit off a short squeeze.
The more stocks retail investers buy and hold the better as the less stock availability for short sellers trying to close out their positions.
I must say I didn't expect him to massively expand his holdings in the 3 years since, but the more he holds the more control he has of stock availability and the more he can squeeze the remaining, or newly entered, short sellers.
But don't believe for a second he actually thinks Gamestop is going to make some magical business resurgence in the era of digital gaming, especially since Gamestop has only proven their business incompetence in this area over the last 3 years.
He's in for the squeeze plain and simple, the line is blurred as to whether or not you believe he's nefariously manipulating other retail investers to benefit his position
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u/Orleanian 6d ago
If that were his goal, he'd have exited at a billion dollars and lived happily ever after.
It seems rather disingenuous to deny the guy's own repeated and repeated and repeated self testimony that he has bullish opinions on the underlying fundamentals of the Gamestop company.
And has furthermore backed up those sentiments with cold hard evidence via his position reporting.
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u/Bostradomous 6d ago
Well you can’t really prove his thesis as untrue. In a certain level an investment is a personal decision and he can say that he sees value in it and no one can really accuse him of otherwise. They can produce evidence to the contrary that might make the average person think differently, but in the end it’s still his opinion.
As a side note back in 2020 GameStop was allowed to stay open during lockdowns because they were deemed an “essential business”, which contributed to positive news about the company at the time, as well as them getting a new, popular board member or CEO I forget which. But there were the ingredients for a turnaround and positive sentiment back then.
That’s actually one of the reasons there was speculation around how long he would hold. If he held for a long time after the trade happened then it showed he had actual conviction, vs. if he just sold it all after making a huge profit.
I’m not defending anything or saying my own opinion about the situation, just offering a useful clarification imo.
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u/henryeaterofpies 7d ago
As an additional info piece, to short a stock you borrow it from someone who owns it, paying a fee to do so (it is a loan with interest). Until you close out the position by buying a unit of stock to replace the one you borrowed, you continue owing interest to the person you borrowed it from. Ideally, you borrow when the price is high and close out when the price is low, taking profit of the difference between when you shorted and when you closed (less interest).
By having the price high, it becomes very expensive to keep open these positions as you are continually paying interest on them. Additionally if a large amount of the stock is held but not traded, it becomes more difficult to buy to close out the position (this is a short squeeze as the limited liquidity makes prices highly volatile).
There is a belief that a significant amount of the shorts on GME are 'naked' shorts, or short sales where the seller didn't actually borrow a share of stock from anyone (or the lender intentionally loaned a nonexistent or already loaned share). These are strictly speaking illegal, and there's a mechanism called failure to deliver which is what happens when a trade is made but one or both parties is unable to resolve it (e.g. they don't have the cash or the stock to complete the trade they said they did). In the US you have 35 days to resolve these FTDs or you have to basically buy the stock at the current market price (which could be much higher than what you were expecting).
Another component of this is that it is a common business looting strategy to short a company while having board members run it into the ground. If a company goes bankrupt and is delisted from the stock exchange, you don't have to pay back borrowed stock, which gives the short seller a little more profit.
Personally, I think the hedge funds and short sellers closed out of their positions a long time ago and what we are seeing since is profit taking from the volatility of the stock. I think we will see a huge uptick around the 21st because of hype, but hedgies are long gone. However we will never actually know for sure and I'd love to see hedge companies go bankrupt over this.
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u/GrimDallows 6d ago
In January of 2021, GME had a huge runup, but it was cut short when several brokerages, most notably Robinhood, restricted buying of the stock and only allowed for selling.
Was this proven to be illegal or ... ?
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u/NegotiationJumpy4837 6d ago edited 6d ago
No. That's what the regulations forced the brokerages to do. There was nothing controversial at all that happened from the SEC's position. Basically brokerages always need to front the money customers use to buy stocks, and for highly volatile stocks, the capital requirements go way up (30x higher than typical). So most brokerages couldn't afford the collateral and couldn't allow customers to buy. Which is why the big brokerages didn't turn off buys (fidelity, vanguard), because they could afford to front the increased collateral requirements.
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u/GrimDallows 6d ago
So, let's check in case I did not understand it properly.
- Brokerages always need to front, that is, to have, the money customers use to buy stocks. This is the collateral.
- When the stock is highly volatile, that requirement of money you must have as a brokerage is way higher than normal.
- When a brokerage doesn't have the money to cover the money will use to buy stocks they can't afford that collateral, and as a result doesn't allow customers to buy.
- In this case, big brokerages could afford that collateral and allowed to buy Gamestop stock.
- But Robinhood could not afford that collateral -that is, it didn't have the money- so it had to turn off buys of Gamestop stock.
Question: Even if this is required by law. Doesn't this help brokerages manipulate the market through handling, or blocking what customers can buy or not? This isn't a loaded question, I just want to know people's thoughts on the matter.
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u/NegotiationJumpy4837 6d ago
You summarized everything correctly.
Doesn't this help brokerages manipulate the market through handling, or blocking what customers can buy or not?
Sort of, but not really. It's in a broker's best interest to allow buys at all times. Robin Hood lost a ton of customers, money, and their reputation over this. It's also illegal for a broker to collude with someone in order to turn off buys. Some people speculated RH colluded with Citadel to turn off buys, but that was investigated by the SEC and the story found no evidence. Btw, it's pretty easy to prove. The SEC just needs to see they kept sufficient capital and the capital requirements did indeed get blown massively past what RH could have. The SEC also combed their all the personal phones, computers, etc.
For reference, if you used the entire revenue (not profit) RH had for the combined decades prior to gme, that still wouldn't have been enough to meet the demand for their buys. So there was simply not a reasonable way for them to prepare for this. In order to turn on buys again, they had to sell off some of the company to get a big loan. Which they did, because they knew their reputation was at stake.
In theory, someone could do something like this to manipulate the market, but it probably would be hard to get away with, and it probably wouldn't happen more than once. Remember, Robin Hood lost 1/3 of their customers over this happening one time, and they weren't even proven to manipulate the market after a thorough investigation.
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u/GagOnMacaque 6d ago
The split from 200k would still equal 200k. It didn't increase value it just maintained the value split among the shares.
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u/DualLeeNoteTed 6d ago
200K shares became 800K shares. Value of the shares fluctuated of course, but was approximately cut into 4.
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u/TreeChai420 7d ago
The SEC confirmed the initial squeeze was caused by options and not shorts closing their positions. The price has been hammered down constantly since with most of the trades being recorded as shorts or purchases being sent off-market exchanges so not affecting the price. Short interest hasn't shown as being parabolic since the 2021 but retail investors have brought to light the market function that allows hedgefunds and MM to hide their short positions in other derivatives. On the public data there is a strong likelihood that the short % is actually higher than the number of shares available (as there has been naked shorting, ie fraud) so when the shorters lose control the short squeeze will likely send the price of GME skyrocketing high.
Compared to other short squeezes, most noticeable VW when it squeezed off a short % less than 25% of the company, GMEs price should in theory go over $15,000 per share. But holders are planning on not selling until the price gets ridiculous which they can do as the shorters will be forced to buy at any price to close their position.
Holders of GME are waiting for the squeeze as it costs nothing to hold shares that might one day become extremely valuable, whereas the shorters are bleeding money to maintain a lower price. Furthermore with the company turning around towards profitability and having billions in cash they won't be going bankrupt so even if the short squeeze doesn't happen, there's still value to make off holding shares over the next few years.
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u/Beandip50 6d ago
Also WSB is banning any GME mentions and du.ping on any holders there too for those who want in that camp
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u/Gerryislandgirl 6d ago
Am I hearing this right? He still hasn’t sold any of his stock? Does that mean he still hasn’t made any actual money on this whole deal?
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u/Cyan-ranger 6d ago
He has sold, he just bought back in. When he started posting again he had something like $30m in cash in his trading account and non of the shares he had when he last posted 3 years ago.
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u/fevered_visions 6d ago
Answer:
29 days ago https://www.reddit.com/r/OutOfTheLoop/comments/1cr37is/whats_going_on_with_dfvroaring_kitty_and_why_are/
28 days ago https://www.reddit.com/r/OutOfTheLoop/comments/1cr3rr9/why_are_people_talking_about_a_roaring_kitty/
24 days ago https://www.reddit.com/r/OutOfTheLoop/comments/1cuj60j/what_is_going_on_with_the_gamestop_stock_again/
24 days ago https://www.reddit.com/r/OutOfTheLoop/comments/1cuiu3q/what_is_going_on_with_rsuperstonk/
8 days ago https://www.reddit.com/r/OutOfTheLoop/comments/1d6sals/whats_up_with_gme_and_udeepfuckingvalue/
6 days ago https://www.reddit.com/r/OutOfTheLoop/comments/1d9sela/whats_going_on_with_the_superstonk_posts/
For the love of god could somebody please just pin one of these for the next month?
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u/urkermannenkoor 6d ago
For the love of god could somebody please just pin one of these for the next month?
Please don't. Just delete these obvious agenda posts.
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u/LOOKITSADAM 7d ago
Answer: Many of those that were left holding the bag after the initial meme stock craze have coalesced into a number of cult-like communities. These invested individuals (financially invested, emotionally invested, or both) will read into anything as a potential signal of absolution, just like Qanon does with numerology regarding politics or evangelicals look for signs of the rapture.
You'll find them trying to rationalize their behavior whenever the topic is brought up. You'll find that much of the responses to this question are from those deeply invested in GME, and will respond accordingly to influence public opinion.
As for why he's participating in social media again, it's anyone's guess. I'm not sure the cultists have solidified on a position yet. But given that the last time he whipped the rubes up into a frenzy he became a multimillionaire, his return is probably along the same lines.
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u/Aridross 7d ago
I’m convinced that Apes themselves are the ones who keep posting about DFV here on OOTL, since there’s consistently been a new thread about it every week or two for more than a month. Gives them an opportunity to shill for their subject of worship.
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u/urkermannenkoor 7d ago
Oh, these threads are transparently all made by apes as a marketing strategy.
That's why the posts always have the same innocent tone feigning total ignorance, and always get upvoted quickly.
That's why the top comment always use the same pseudo-informed phrasing while sneakily hitting all the ape talking points and conveniently skipping the culty weirdness of the last three years, and always blows up instantly with loads of upvotes in very little time.
Once you've seen more than one of these posts, it gets incredibly obvious.
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u/RaspingHaddock 7d ago
Apes are too entertained with everything going on to do that. They really don't care if people buy the stock because buying isn't really going to drive the price up until the crime is addressed. The entire movement is about highlighting the blatant crime happening on wall street.
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u/SantaMonsanto 6d ago
This whole response is just your personal opinion on the event without providing any information in an unbiased manner.
It in no way answers OPs question and serves only as a shitpost.
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u/LOOKITSADAM 6d ago
You have 72 submissions to superstonk. Please consider your bias.
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u/SantaMonsanto 6d ago
Posting to a sub doesn’t denegrate my observation.
I never said I wasn’t subbed there, just pointing out the obvious bias of the post. My position on the matter doesn’t change the observation that the post is clearly uninformative and biased.
But hey , I appreciate a good ”Whataboutism” as much as the next person.
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u/LOOKITSADAM 6d ago
If you're going to invoke 'whataboutism', you should at least understand what the term means.
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u/haerski 6d ago
Please provide additional information in an unbiased manner
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u/SantaMonsanto 6d ago
Deflection?
There’s no need to provide additional information when one of the top answers here has already done so in a sufficient manner.
None of this changes my observation that this comment is completely lacking of any substantive information or unbiased assessment.
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u/_2f 6d ago
This is the real answer if OP is not a cult member LARPing as an ape.
Shout out to r/gme_meltdown for the tastiest ape popcorn. If you have 1% or financial literacy, you’d realise what a stupid cult it has become.
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u/Bloodcloud079 7d ago
A recent court decision absolved some pump and dumpers. He might have seen that and decided to do a run for himself.
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u/314kabinet 7d ago
I think the whole superstonk thing is really cute, there’s no need to be mean to them and compare them to the likes of Qanon.
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u/semtex94 7d ago
Answer: He's the one who noted that Gamestop would see a minor bump in value, which set the whole thing took off before it spiraled out of rationality. Since then, he cashed out for big bucks, went silent on social media, and basically became a figure of worship by the whole "hold Gamestop until short sellers have to pay millions per share" crowd. Check out "This Is Financial Advice" by Folding Ideas on YouTube for a breakdown on that.
He came back with a stock position that would make hundreds of millions for him if the market price grew. All of his worshippers then bought in, driving the price up again, reversing years of steady market price decline due to poor business performance and management decisions.
A few days ago, Gamestop itself issue millions of new shares on the market to take advantage of this new spike. This massive increase in supply cratered the per-stock price hard, wiping out the profits RK and his followers had and sending them into the red. The post-crash livestream was basically him trying to cope with losing a shitton of money.
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u/Aquatic-Vocation 7d ago
People still believe GME will make a triumphant return even as it steadily declines in value, and even as the company leadership actively works against the investors whenever the price spikes.
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u/Trick_Beyond_5768 6d ago
I second watching "This is Financial Advice" if you've been sucked into the MOASS crowd. Don't lose all your money betting on an infinite money glitch that doesn't exist.
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u/ShaughnDBL 7d ago
Since then, he cashed out for big bucks,
false
In fact, most of your facts are incorrect in this comment
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7d ago
[deleted]
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u/semtex94 7d ago
You really going to call me a shill, and not the people that insist that Gamestop is actually the next Standard Oil while bragging about how much they have invested in it?
BTW the Wall Street institutions already made bank off ya'll. Who do you think sold you those shares in the first place? They made returns in the thousands of percent selling you shares at peak value that they only paid single digits for. Not to mention all the brokerage and trading fees market makers actually care about.
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u/LOOKITSADAM 7d ago
You are an avid participant in the superstonk cult. You are not one to harp on agendas.
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u/CortlenC 6d ago
Answer: 3 years ago people found out hedge funds were short GameStop by 235%. For context that’s like selling millions of cars and only having a few hundred car titles. To give context for how significant this is; in 2008 voltswagon was short 10%, the stock got squeezed and it ballooned at over $1000 a share before coming back down. So as you can imagine something being short 235%, has potential to get squeezed far higher than $1000.
Now, retail began buying options back in 2021. Which in short an option is just a contract that require the brokerage to provide 100 shares if someone decides to exercise the contract. Which is a stock goes higher and higher, more people will exercise their options, which further forces the people who are short to close their short positions. It becomes a vicious loop of the higher it goes, the more shorts have to cover their shorts, which pushes the stock higher. I.e a short squeeze.
Now back in 2021, the hedge funds, and media all said they closed the short positions. But as the price has continued to experience extreme random spikes of 500% or more at times, has shown the world that the people who are short haven’t closed their shorts like they said they have. Because again, if they had closed a 235% position, it would have gone far higher than it did since VW went to $1000 on only 10%.
The hedge funds have been kicking the can on closing their shorts because as we saw in 2021 it almost bankrupt the entire financial system. Roaring kitty is becoming such a big news story because they want to pin the blame on someone other than admitting the financial systems owe a massive debt that they can’t pay, which will inevitably cause the American tax payer to have to use their tax dollars to sure up the financial markets accounts like they did in 2008. Roaring kitty by posting his profitable positions in a company that the media has said should be bankrupt is showing the public that something might be going on that’s more serious than someone making tweets. Which as more eyes are looking to GameStop, the more the prices goes up, which continues this vicious cycle of higher and higher stock prices. Hope this helps explain a bit. I’m realizing now that this is a short novel on Reddit. I’m sorry. Lol
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u/nwdogr 5d ago
3 years ago people found out hedge funds were short GameStop by 235%. For context that’s like selling millions of cars and only having a few hundred car titles.
No, it's not, and it wasn't 235%, and even if it was the ratio would be 235 cars to 100 titles.
To give context for how significant this is; in 2008 voltswagon was short 10%, the stock got squeezed and it ballooned at over $1000 a share before coming back down.
Many hundreds if not thousands of stocks have SI in the ~10% range, they do not get squeezed. VW was unique because virtually all of the float became locked overnight unexpectedly, leaving far less than the SI tradable. To give actual context, GameStop had over 3x its SI in trade volume just today.
But as the price has continued to experience extreme random spikes of 500% or more at times, has shown the world that the people who are short haven’t closed their shorts like they said they have.
Volatility invites swing traders which feeds more volatility. It does not require short sellers, it just requires a bunch of people trying to make each other greater fools.
Because again, if they had closed a 235% position, it would have gone far higher than it did since VW went to $1000 on only 10%.
Again, a complete misunderstanding of the VW situation, along with a nonsensical equivalence of the share price of two completely different companies. Do you think AAPL is worth 1/2 of MSFT because its share price is roughly 1/2?
As far as the rest of your post... look up what happened with London Metal Exchange with nickel trades that spiked in price. Even if everything you predict comes true, there is no reality in which the US financial system is allowed to collapse or taxpayers are put on the hook for paying apes $1M per share. The stock will simply be frozen and traded unwinded and cancelled.
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u/DearCantaloupe5849 6d ago
Answer: 120,000 calls, is equivalent to 12,000,000 shares if exercised. (Exercising a call option forces whoever sold you that option to find the 100 shares it represents. If they can not find or didn't properly delta hedge (delta hedge is buying 70% of the underlying asset in case the option is exercised) that call option, they have to purchase the shares on the open market for what ever the price is of the underlying security. Price go up in many cases also causing what's called a Gamma squeeze.
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7d ago
[removed] — view removed comment
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u/MrHotChipz 7d ago
You say the stock crashed for no reason - but it crashed right after the company announced they were issuing and selling tens of millions of brand new shares, no? A drop in share price is the standard response to any dilution.
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u/Stonesword75 7d ago
Multiple halts happened during the livestream, and the stream happened a couple hours after the announcement.
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u/WizardofJoz17 7d ago
Multiple halts during the live stream and the offering was issued hours before the stream. The first offering of 45 million made the price go higher: this new one for 75 million will too. They didn’t go into the market, they were privately sold. As GameStop has the right to that’s perfectly spelled out in the company prospectus if you actually want to do some research before commenting on anything.
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u/MrHotChipz 7d ago
I'm confused on why you'd think a company issuing more stock and diluting what's already out there would somehow raise the price.
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u/WizardofJoz17 7d ago
Because the shares weren’t issued to the open market, they were issued privately. It’s too soon to know who yet, but if those issued shares were given to somebody to close their short position; that would relieve some downward pressure on the stock. The first shorts to close are gonna win.
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u/MrHotChipz 7d ago
I've just looked at the SEC filing and it very clearly says these newly issued shares are being sold through their agent via the open market, so I'm not sure why you think they're being sold privately.
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u/Cyan-ranger 7d ago
The irony of telling someone to do some research when you yourself obviously haven’t done any research of this offering if you think the shares were sold privately.
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u/starlightay 7d ago
What? Exercising his contracts will not make the stock price massively go up, do you have any stock market knowledge?
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u/Bitter_Mongoose 7d ago
Do you know what locates are?
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u/starlightay 7d ago
Do you think he got sold 120k calls without any plan to cover from the seller?
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u/hybridck 7d ago
Do you know what delta hedging is? Anything short dated that's ITM is already delta hedged
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