We'll probably end up with government-mandated warning labels for stock purchases.

Maybe a big popup every time you log in to your trading account that says:

"Warning: Investing is risky. You could lose all your moneys. Don't rely on memes for investment advice. Investing is known to the state of California to cause cancer. Not responsible for injuries that result from the using this trading platform outside of its intended uses. If ingested, contact Poison Control. Patent Pending. All rights reserved. Check here and select all the traffic lights in the photos to certify that you have read this user agreement and are not a robot."

This is playing out exactly as I had predicted last week and many others said same as well.

Short interest is said to be at 39% now according to IHS MarkIt. That's not really squeezable anymore.

I'd bet that after all of this are said and done, the hedgies will walk with little losses. When it was sitting between 300 and 480, it was guaranteed money for the shorties - guaranteed, and that's when I took the risk of a short position. I am a small fish, so I'd imagine how the Wall St sharks looking at that juicy 300-500 price of GME. I'd bet they took huge bites then in new short positions.

And maybe that's exactly why Melvin took more capital from others to set up the trap.

Hold on a sec. I thought RH cut off trading because they don’t execute trades themselves but pay one or more “middle men” to do so, and with the volume of trades they didn’t have the cash on hand to cover the tab? It wasn’t to protect anyone, either their customers or anyone on Wall St.

Mark Cuban did an AMA on Reddit earlier, and while i didn’t read the whole thing his belief is that this is just the beginning of a David vs Goliath battle against hedge funds and other big money investors. The key he said is finding platforms that have trillions, yes Trillions of dollars in backing so there is never another shortage of capital like with RH.

quote:

Originally posted by Puckpilot78:
Hold on a sec. I thought RH cut off trading because they don’t execute trades themselves but pay one or more “middle men” to do so, and with the volume of trades they didn’t have the cash on hand to cover the tab? It wasn’t to protect anyone, either their customers or anyone on Wall St.

Mark Cuban did an AMA on Reddit earlier, and while i didn’t read the whole thing his belief is that this is just the beginning of a David vs Goliath battle against hedge funds and other big money investors. The key he said is finding platforms that have trillions, yes Trillions of dollars in backing so there is never another shortage of capital like with RH.

RH could have throttled back all trades across the platform to keep enough leverage banked with the clearing house.

But, they didn't.

They selectively applied their own rules in order to benefit their customers at the cost of the consumer.

quote:

Originally posted by RogueJSK:
We'll probably end up with government-mandated warning labels for stock purchases.

Maybe a big popup every time you log in to your trading account that says:

"Warning: Investing is risky. You could lose all your moneys. Don't rely on memes for investment advice. Investing is known to the state of California to cause cancer. Not responsible for injuries that result from the using this trading platform outside of its intended uses. If ingested, contact Poison Control. Patent Pending. All rights reserved. Check here and select all the traffic lights in the photos to certify that you have read this user agreement and are not a robot."

This following 'guidance' and link to 'Learn More' showed up in my Fidelity account recently:

Please see perspective from the Securities and Exchange Commission (SEC) on the risks of day trading.

https://www.investor.gov/addit...y-trading-know-risks

Actually, the timing was 'almost' uncanny....Here comes a statement from the SEC under the guise of 'know the risks, we're from the .gov, and we're here to protect you from yourself'!

Curiously (NOT!), this coincided with almost exactly when, at Citadels direction, RobinHood started restricting trades/purchases of GME (as well as other trendy 'meme' stocks), and started closing investor positions w/o any authorization and/or justification, seemingly in an effort to protect the hedge funds.

This was also two days after it became widely known that Melvin Capital had shorted 140% of the available shares of GameStop! You know, right after Citron injected 2.8 Billion into Melvin, and precisely when the GME 'Short Squeeze' lifted the curtain shielding from public view, how the hedge funds were manipulating the market.

Sooo, just when things were getting REALLY exciting, and David vs. Goliath was playing out in real time....Nope, the wrong people were making money, and we can't have any of that!

quote:

Originally posted by Puckpilot78:
Hold on a sec. I thought RH cut off trading because they don’t execute trades themselves but pay one or more “middle men” to do so, and with the volume of trades they didn’t have the cash on hand to cover the tab? It wasn’t to protect anyone, either their customers or anyone on Wall St.

RobinHood specifically stated that their actions were being taken "to mitigate risk for our clients".

TD said the same, stating that they were putting in similar restrictions "to [mitigate] risk for our company and clients."

quote:

Originally posted by RogueJSK:

quote:

Originally posted by Puckpilot78:
Hold on a sec. I thought RH cut off trading because they don’t execute trades themselves but pay one or more “middle men” to do so, and with the volume of trades they didn’t have the cash on hand to cover the tab? It wasn’t to protect anyone, either their customers or anyone on Wall St.

RobinHood specifically stated that their actions were being taken "to mitigate risk for our clients".

TD said the same, stating that they were putting in similar restrictions "to [mitigate] risk for our company and clients."

Those statements are utter complete bullshit! Their role as a trading mechanism is to execute the requests of their clients if at all possibly period, not make any determination to prevent a client from doing something stupid.

quote:

Originally posted by RogueJSK:

quote:

Originally posted by Puckpilot78:
Hold on a sec. I thought RH cut off trading because they don’t execute trades themselves but pay one or more “middle men” to do so, and with the volume of trades they didn’t have the cash on hand to cover the tab? It wasn’t to protect anyone, either their customers or anyone on Wall St.

RobinHood specifically stated that their actions were being taken "to mitigate risk for our clients".

TD said the same, stating that they were putting in similar restrictions "to [mitigate] risk for our company and clients."

They have been all over the board contradicting themselves right and left.

Here is an interview with direct quotes from the Robinhood CEO Vlad Tenev:

https://www.businessinsider.co...mestop-stocks-2021-2

Elon Musk led a bizarre interview with Robinhood's CEO, quizzing him about last week's GameStop stock drama

The GameStop stock saga took a new turn on Sunday night when Tesla CEO Elon Musk unexpectedly interviewed Vlad Tenev, the CEO of the trading app Robinhood, on the new audio app Clubhouse.

Robinhood was the target of widespread outrage last week when it stopped users from purchasing shares of GameStop, AMC, BlackBerry, and other so-called meme stocks that had rocketed over the week, fueled by Reddit users.

Musk went on Clubhouse for a wide-ranging interview in which he spoke about his plans to colonize Mars; his neural-technology company, Neuralink; and his love of memes. At the end of the interview, Musk brought in Tenev, introducing him as "Vlad the stock impaler."

"Spill the beans, man, what happened last week? Why couldn't people buy the GameStop shares?" Musk said. "The people demand an answer, and they want to know the details and the truth."

Tenev said Robinhood had been forced to temporarily stop users from buying those stocks because the surge had resulted in a deposit requirement of $3 billion from the National Securities Clearing Corporation. Robinhood, which had raised only $2 billion in venture capital, spoke with the NSCC to get that requirement reduced to $700 million, Tenev said.

His comment echoed a statement from Robinhood on Friday.

Tenev said that the NSCC's decision-making process to get to the $3 billion figure was "opaque" and that it was hard to know why it settled on that.

"Did something maybe shady go down here?" Musk said.

Tenev answered that he wouldn't say so, adding that the NSCC had been cooperative after the initial $3 billion deposit request.

Musk also asked whether Citadel Securities, a market maker and intermediary for Robinhood, could have influenced the NSCC's decision.

"There was a rumor that Citadel or other market makers kind of pressured us into doing this," Tenev said, "and that's just false."

"But wouldn't they have a strong say in who got put in charge of that organization since it's an industry consortium and not a government consortium, or not a government regulatory agency?" Musk said of the NSCC.

Tenev said he didn't "have any reason to believe" that. "Then you're getting into the conspiracy theories a little bit," he said.

A Citadel Securities spokesperson told Insider: "Citadel Securities has not instructed or otherwise caused any brokerage firm to stop, suspend, or limit trading or otherwise refuse to do business. Citadel Securities remains focused on continuously providing liquidity to our clients across all market conditions."

Musk regularly chimed in during the interview with jokes; at one point he asked Tenev, "Is anyone holding you hostage right now?"

Many of the Reddit traders said a motivation for galvanizing meme stocks was to take on hedge funds with heavily shorted stocks. Musk, who has historically attacked short-sellers, has been described as a sort of folk hero for Reddit day traders.

This wasn't the first time Musk demanded answers from Robinhood. Last week, he expressed support for Rep. Alexandria Ocasio-Cortez's call for the House Financial Services Committee to hold a hearing on the app's actions.

Robinhood allowed trading of meme stocks.

Full audio of the interview at the link.

Sounds like a reasonable explanation is that RobinHood really did run out of deposit money as stated, but initially tried to pitch it to their clients as "Oh, we're doing this to protect you, for your own good", which has since backfired spectacularly, and no amount of trying to re-explain and come clean is going to help much.

quote:

Originally posted by cruiser68:

quote:

Originally posted by RogueJSK:


TD said the same, stating that they were putting in similar restrictions "to [mitigate] risk for our company and clients."

Those statements are utter complete bullshit!

You would think so but hear me out. The people who loaded up when GME was $4-20 already made bank if they were smart enough to cash out. At $300-400 per share the people who were mindlessly buying it thinking it was going to goto $500 or $1000 are already in a world of hurt. The people who would have gotten in at higher levels wouldn't have anything after GME reverted back to the mean.

You'll hear about the guys who made millions from this play. Who you won't hear from are the tens if not hundreds of thousands of people who lost most if not all they put into GME. Robinhood is a scumbag org that I wouldn't use if they were the last trading platform on Earth. TD, however, has every right to protect their clients from this scam and I have zero issue with them shutting down trades on something that most people are going to lose money on at this point. If you really feel that compelled to lose your money move it to another platform.

GME is trading at $98.06 as I type this. 24 hours ago it was ~$235 with a high of ~$398. If you were a TD customer ready to put some money into it yesterday you're thanking TD for saving your ass for making a stupid decision that you read about on the internet.

quote:

Originally posted by Hildur:

quote:

Originally posted by cruiser68:

quote:

Originally posted by RogueJSK:


TD said the same, stating that they were putting in similar restrictions "to [mitigate] risk for our company and clients."

Those statements are utter complete bullshit!

You would think so but hear me out. The people who loaded up when GME was $4-20 already made bank if they were smart enough to cash out. At $300-400 per share the people who were mindlessly buying it thinking it was going to goto $500 or $1000 are already in a world of hurt. The people who would have gotten in at higher levels wouldn't have anything after GME reverted back to the mean.

You'll hear about the guys who made millions from this play. Who you won't hear from are the tens if not hundreds of thousands of people who lost most if not all they put into GME. Robinhood is a scumbag org that I wouldn't use if they were the last trading platform on Earth. TD, however, has every right to protect their clients from this scam and I have zero issue with them shutting down trades on something that most people are going to lose money on at this point. If you really feel that compelled to lose your money move it to another platform.

GME is trading at $98.06 as I type this. 24 hours ago it was ~$235 with a high of ~$398. If you were a TD customer ready to put some money into it yesterday you're thanking TD for saving your ass for making a stupid decision that you read about on the internet.

Yes all of what you say is true. My point of contention is a trading company's role IS NOT TO DECIDE what stocks are good and bad. Their job is to execute trades. If it was a funding issue they should have stopped accepting any and all trades period. If I want them to manage my money I would open up a managed account and let them decide how to invest my money. If I want to use them as my day trading platform then they should have ZERO input into the trades I am requesting.

And what if the stop trading order prevented me from making tons of money instead of losing money? Is it ok for them to not execute my trade in that scenario or only when they THINK it is not a good choice?

TD Ameritrade didn't restrict buying. You can buy those stocks all you want, just no margin (which is fair, you can buy it with your own $ but they aren't letting you borrow theirs!)

Someone correct me if I'm wrong, but I just looked at the restriction again in my account.

quote:

Originally posted by Strambo:
TD Ameritrade didn't restrict buying. You can buy those stocks all you want, just no margin (which is fair, you can buy it with your own $ but they aren't letting you borrow theirs!)

Someone correct me if I'm wrong, but I just looked at the restriction again in my account.

That makes sense.

I'm not a TD user, so I was just going off their very vague statement from the height of the feeding frenzy, which stated that they had enacted restrictions, but didn't specify what the restrictions were:

“In the interest of mitigating risk for our company and clients, we have put in place several restrictions on some transactions in $GME, $AMC and other securities,” a spokeswoman for TD Ameritrade told MarketWatch, referring to the ticker symbols of the companies. “We made these decisions out of an abundance of caution amid unprecedented market conditions and other factors.”

Is it possible that they had temporarily enacted even more restrictions last week, and then later removed all but the "no margin" ones? Or was "no margin" the total extent of their restrictions?

quote:

Originally posted by cruiser68:


Yes all of what you say is true. My point of contention is a trading company's role IS NOT TO DECIDE what stocks are good and bad. Their job is to execute trades.

Read the terms of service. They have every right to prohibit you from trading for any reason.

quote:

And what if the stop trading order prevented me from making tons of money instead of losing money? Is it ok for them to not execute my trade in that scenario or only when they THINK it is not a good choice?

Tough cookies. When markets crash they don't let you sell either. You can buy 99.9% of the other stocks that aren't being obviously manipulated. If you don't like it quit the platform.

There's this sense of entitlement that some people have thinking that they should be able to make whatever trade they want whenever they want. Have you not been listening to what I've been saying? There is a house and they make the rules. They can bend the rules and they have broken the rules. You're just along for the ride.

I had no problem with TD Ameritrade buying shares of GME yesterday. My guess is that my account had plenty of liquidity in the form of settled cash sitting.

RH should have just proceeded to trade on a first come first serve basis until they ran out of money with the clearing house.

quote:

Originally posted by heathtx:
I have some GME, have watched it shoot up. I bought some $300 puts to protect my profit. The guy who sold the put MUST buy each share at $300 anytime (if it closes below $300) between now and Feb 19. So I don’t really care what it does, I locked in a good profit today.

The higher GME goes, the less that option costs, so if GME continues to climb I can ratchet up the strike price of the put...

Post above is from Jan 27. It looks like the GME bubble is over,

Not sure when I will exercise the Put, but whoever sold the Put is going to feel some pain............

quote:

Originally posted by Hildur:

quote:

Originally posted by cruiser68:


Yes all of what you say is true. My point of contention is a trading company's role IS NOT TO DECIDE what stocks are good and bad. Their job is to execute trades.

Read the terms of service. They have every right to prohibit you from trading for any reason.

quote:

And what if the stop trading order prevented me from making tons of money instead of losing money? Is it ok for them to not execute my trade in that scenario or only when they THINK it is not a good choice?

Tough cookies. When markets crash they don't let you sell either. You can buy 99.9% of the other stocks that aren't being obviously manipulated. If you don't like it quit the platform.

There's this sense of entitlement that some people have thinking that they should be able to make whatever trade they want whenever they want. Have you not been listening to what I've been saying? There is a house and they make the rules. They can bend the rules and they have broken the rules. You're just along for the ride.

You are absolutely correct. My position is on how they should operate. I agree it is a rigged game and market manipulation by the big boys occurs constantly. They should be more transparent but then again they are in bed with our politicians so not likely to change.

quote:

Originally posted by heathtx:

quote:

Originally posted by heathtx:
I have some GME, have watched it shoot up. I bought some $300 puts to protect my profit. The guy who sold the put MUST buy each share at $300 anytime (if it closes below $300) between now and Feb 19. So I don’t really care what it does, I locked in a good profit today.

The higher GME goes, the less that option costs, so if GME continues to climb I can ratchet up the strike price of the put...

Post above is from Jan 27. It looks like the GME bubble is over,

Not sure when I will exercise the Put, but whoever sold the Put is going to feel some pain............

Nice! I was actually thinking about your post from the 27th and wondering what your premium was.

quote:

Originally posted by RogueJSK:
Even if this is the death throes of GME, there's still quite a bit of scrambling to go before anyone's left holding the bag (well, except for those latecomers that first bought in a few days ago in the $200s/$300s).

Yep. My nephew bought GME at $300.

https://twitter.com/iowahawkbl.../1356697813762080769