GME was not shorted because it's not a good company. It was shorted because Melvin Capital saw an opportunity to make money by manipulating its share price and it spectacularly backfired. The quality of the company is immaterial.I am not here to defend hedge funds,
GME isn’t a good company.
GME was not shorted because it's not a good company. It was shorted because Melvin Capital saw an opportunity to make money by manipulating its share price and it spectacularly backfired. The quality of the company is immaterial.
I only meant it was immaterial in the context of the market manipulators. I think shorting should be banned and let companies float to the level they're actually worth based on business fundamentals not based on get rich quick shysters.your last sentence is the problem long term For the markets
if the markets just become about shorting, hedging, internet rumour not the company performance that is going to be a problem on company valuations.
that has an impact of listed companies everywhere because to use your words “ the quality of the company is immaterial”
long term people will lose confidence in the markets due to short term volatility.
your last sentence is the problem long term For the markets
if the markets just become about shorting, hedging, internet rumour not the company performance that is going to be a problem on company valuations.
that has an impact of listed companies everywhere because to use your words “ the quality of the company is immaterial”
long term people will lose confidence in the markets due to short term volatility.
Have hedge funds been made to sell their long positions on other stocks to cover this gamestop shenanigans?
This really isn’t a good take.Essential what is going on here is small retail investors are piling into poor quality stocks that by all rights should be going down in order to artificially boost them up. It is inevitable that many people will get burned. In the stock market there are 2 parties to every trade and for everyone buying and selling at a profit there has to be someone on the other side trading at a loss.
There is a wider story about hedge funds and short positions but don't let that distract you from the fundamental above.
Its the reality.This really isn’t a good take.
Good point. There was speculation that Melvin Capital was bailed out by other hedge funds to prevent them from selling other long positions in order to cover their margin calls on GME. They are probably long in the same stocks and want to prevent a liquidation cascade
That’s also an awful take.GME is a failing bricks and mortar games selling company that makes losses. It’s a shit company hence the hedge funds shorting it.