MCFCinUSA
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- Joined
- 14 Dec 2008
- Messages
- 5,299
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- City since 1977
Bigga, no one knows exactly what's going on with GameStop with regards to positioning, and who is doing what.
As I said above, retail traders have been net sellers of the stock this week, after they were net buyers on Monday only, so 'non-retail' traders were doing the buying and propelling things further skywards. Who they are, and exactly what size they're moving in is anyone's guess - but if you look at the total figures the numbers of shares traded is ridiculous.
A little like sharks when you throw chum in the water, all kinds of trading firms have been circling and 'lumping on' against the short position and aggravating matters - which is what I was referencing with regards to financial thuggery.
My guess would be it's the specialist prop, day-trading and high frequency firms (with a level of sophistication behind them) most likely to feeding on this kind of situation, because it's what they're best suited to take advantage of. No long-term 'value investment' group is going to be buying GameStop at today's prices (Michael Burry bought it, but that was I believe when it was less than $5 and I think his filings show he's also sold most of it by now, I think after his initial investment tripled and quadrupled) just like no long-term investment vehicle is going to be buying Bitcoin, although for slightly differing reasons - and Bitcoin* is something else entirely.
The current value of GameStop is out of all proportion to its fundamentals, and has gotten this way because of structural anomalies in the market place and poor liquidity, and how long this situation remains like this is another unknown. I'd expect to see it back in the double-digits if it's going to change by another 'zero' rather than going up further into the $000s. It seems to be just another example (although perhaps the most extreme and most recent) of the speculative mania we are currently in and late stage bull market behaviour - speaking of the USA, and a canary in the coalmine that all is not well. If you wanted to set the stage for the next bear market, obliterating all the shorts and creating an army of retail bag holders at the same time would be a pretty good way to start.
* Bitcoin isn't likely to become a mainstay of any traditional investment vehicle whilst it is still volatile. Perhaps an investment fund might allocate up to 1% of their assets to crypto, if they're permitted to - a hedge fund perhaps? - but with something that can lose a tenth to a half of its value in no time at all, compliance issues won't permit pension funds to be going anywhere near something like this. At the end of the day Bitcoin might turn out to be three letters (BTC) that go across your trading screen, because there are no income streams and it doesn't pay a dividend and it isn't backed up by anything or anyone, just blind faith - so it's only worth what someone wants to pay for it; if things get really rocky, BTC's worth could evaporate too.
As I said above, retail traders have been net sellers of the stock this week, after they were net buyers on Monday only, so 'non-retail' traders were doing the buying and propelling things further skywards. Who they are, and exactly what size they're moving in is anyone's guess - but if you look at the total figures the numbers of shares traded is ridiculous.
A little like sharks when you throw chum in the water, all kinds of trading firms have been circling and 'lumping on' against the short position and aggravating matters - which is what I was referencing with regards to financial thuggery.
My guess would be it's the specialist prop, day-trading and high frequency firms (with a level of sophistication behind them) most likely to feeding on this kind of situation, because it's what they're best suited to take advantage of. No long-term 'value investment' group is going to be buying GameStop at today's prices (Michael Burry bought it, but that was I believe when it was less than $5 and I think his filings show he's also sold most of it by now, I think after his initial investment tripled and quadrupled) just like no long-term investment vehicle is going to be buying Bitcoin, although for slightly differing reasons - and Bitcoin* is something else entirely.
The current value of GameStop is out of all proportion to its fundamentals, and has gotten this way because of structural anomalies in the market place and poor liquidity, and how long this situation remains like this is another unknown. I'd expect to see it back in the double-digits if it's going to change by another 'zero' rather than going up further into the $000s. It seems to be just another example (although perhaps the most extreme and most recent) of the speculative mania we are currently in and late stage bull market behaviour - speaking of the USA, and a canary in the coalmine that all is not well. If you wanted to set the stage for the next bear market, obliterating all the shorts and creating an army of retail bag holders at the same time would be a pretty good way to start.
* Bitcoin isn't likely to become a mainstay of any traditional investment vehicle whilst it is still volatile. Perhaps an investment fund might allocate up to 1% of their assets to crypto, if they're permitted to - a hedge fund perhaps? - but with something that can lose a tenth to a half of its value in no time at all, compliance issues won't permit pension funds to be going anywhere near something like this. At the end of the day Bitcoin might turn out to be three letters (BTC) that go across your trading screen, because there are no income streams and it doesn't pay a dividend and it isn't backed up by anything or anyone, just blind faith - so it's only worth what someone wants to pay for it; if things get really rocky, BTC's worth could evaporate too.