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GME, Hedge Funds, Citadel and Reddit


Foxx
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2 hours ago, GG1 said:

I was just reminded that Maxine will chair the GME hearings.  That should be a hoot.

The one clip I saw showed her to have a lack of knowledge in the subject she is supposed to be regulating.  I would not trust her to run a lemonade stand.

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14 hours ago, Ann said:

Hmm, I have not seen this reported anywhere else...not saying it did not happen, just want to see some other confirmation. Think Squawk would have been all over this, or Brett on Special Report last night...neither have mentioned anything about it.

 

BTW, can someone explain PFOF to me in terms of how the market maker makes  money? 

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16 minutes ago, plenzmd1 said:

Hmm, I have not seen this reported anywhere else...not saying it did not happen, just want to see some other confirmation. Think Squawk would have been all over this, or Brett on Special Report last night...neither have mentioned anything about it.

 

BTW, can someone explain PFOF to me in terms of how the market maker makes  money? 

 

Here's your homework Sue.

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3 minutes ago, GG1 said:

 

Here's your homework Sue.

Ha, I understand what it is..but that article as well does not explain how the MM makes cash. Is it simply they execute more shares and thus keep less of the spread, but do much higher volume than the competition? 

 

Against he law to frontrun trades, so cant be that. Selling aggregate info? 

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9 minutes ago, plenzmd1 said:

Ha, I understand what it is..but that article as well does not explain how the MM makes cash. Is it simply they execute more shares and thus keep less of the spread, but do much higher volume than the competition? 

 

Against he law to frontrun trades, so cant be that. Selling aggregate info? 

 

I'm definitely not in the weeds of the equity plumbing, but as you can imagine, if a MM drives more volume through its pipes, there's so much more opportunity to earn ancillary revenue from that activity, which can include skimming basis point percentages off the higher float, greater ability to trade on its own platforms away from the exchange, etc.  

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10 minutes ago, GG1 said:

 

I'm definitely not in the weeds of the equity plumbing, but as you can imagine, if a MM drives more volume through its pipes, there's so much more opportunity to earn ancillary revenue from that activity, which can include skimming basis point percentages off the higher float, greater ability to trade on its own platforms away from the exchange, etc.  

yea, the CEO of Citadel was on this morning, and the exchange piece was discussed..trading in fractions of a penny for a MM, exchange is only in penny...man, that dude was smart. Sorkin tried to bring up some claptrap letter  railing against PFOF from 2004 written by the GC of Citadel...dude slapped him around and said that was specific to options..not shares. Love when Sorkin gets slapped around

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32 minutes ago, plenzmd1 said:

yea, the CEO of Citadel was on this morning, and the exchange piece was discussed..trading in fractions of a penny for a MM, exchange is only in penny...man, that dude was smart. Sorkin tried to bring up some claptrap letter  railing against PFOF from 2004 written by the GC of Citadel...dude slapped him around and said that was specific to options..not shares. Love when Sorkin gets slapped around

 

Never miss a moment to slam Sorkin's faux populism.

 

Griffin better be impressive considering what he built with Citadel.  I felt sorry for some of the questions he fielded yesterday, and you could see him struggling not to blurt out, "Uhhm, that was a stupendously stupid question.  Your aides should be fired on the spot for writing that for you, Congressman, because they just embarrassed you in front of the nation"

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GME Gamma Squeeze: Round 2

GME Gamma Squeeze – What Happened?

Yesterday GME saw another massive price move with the stock ripping over 100% from $45 up over $160 in after hours trading. This move was likely fueled by an options gamma squeeze as we’ll explain here.

 

First, note the existing options positions in GME, from the day prior to yesterdays squeeze (Tuesday, 2/23). There was a large concentrated put position as highlighted in red box below. Call options in decent size were also spread from 40 up all the way into the 500 strikes (green box). This infers that as the stock started to lift off, all of those put positions started to bleed in value, which may have allowed market makers to reduce their short stock position. As the stock lifted higher all of those preexisting call positions start to pick up in value, requiring additional long stock hedges. In other words the “pump was primed” for a gamma squeeze. ...

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54 minutes ago, Foxx said:

 

GME Gamma Squeeze: Round 2

GME Gamma Squeeze – What Happened?

Yesterday GME saw another massive price move with the stock ripping over 100% from $45 up over $160 in after hours trading. This move was likely fueled by an options gamma squeeze as we’ll explain here.

 

First, note the existing options positions in GME, from the day prior to yesterdays squeeze (Tuesday, 2/23). There was a large concentrated put position as highlighted in red box below. Call options in decent size were also spread from 40 up all the way into the 500 strikes (green box). This infers that as the stock started to lift off, all of those put positions started to bleed in value, which may have allowed market makers to reduce their short stock position. As the stock lifted higher all of those preexisting call positions start to pick up in value, requiring additional long stock hedges. In other words the “pump was primed” for a gamma squeeze. ...

 

Awesome as those that got in at $350 and finally gave up and got out at $45 are hopefully reconsidering ever playing this game again. 

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Guess who's back.

 

With everything that is going on, I don't expect that these meme stocks are going to quit anytime soon.

 

GameStop Options Bet That the Stock Will Reach $800 on Friday

Shares of GameStop Corp. doubled yesterday and jumped another 19% today. ...

 

... The most-active option traded on the stock Thursday was a contract betting that GameStop shares would spike to $800 on Friday. Some 52,000 contracts changed hands during the session betting on this one-day gain of 636%

 

For other options traders, it was a question of when GameStop would hit the $800 mark, not if. The seventh and eighth most-active contracts were call options wagering that the stock would reach $800 by next Friday or in three weeks. It’s hard to say whether the contracts were mainly bought or sold, two traders said.

 

600x-1.png

...

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  • 2 weeks later...
7 hours ago, LB3 said:

Currently trading at $292.

 

And how many bought at $350 and sold at $45 are thinking "should I get back in at $350??"  

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3 hours ago, Chef Jim said:

 

And how many bought at $350 and sold at $45 are thinking "should I get back in at $350??"  

Stupid should hurt.

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  • 2 months later...

Dumped all my shares of AMC today.  Watched the stock price for about an hour when it was around $56/share.  It would go up a few cents, down a few, no real travel one way or the other, so I sold all I had.  Made a nice profit too.  That's right, I bought it back when it was $12/share.  Made around $175 on my 4 shares I had. 

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