Fixed that for you. The underlying problem with that plan is that "all people" will never manage to HODL a stock that keeps rising. Sooner or later a few lucky HODLers will take their gains, and then the whole scheme will end. It's a bubble, no different than the previous bear raid was. The truth is most likely in the middle.
Who has 120% of stocks to sell back to billionaire short sellers?
The billionaire vulture short sellers created this mess. Now, they are the one's that have to pay the price.
Why would they have to be distinct shares - which obviously can't exist at that percent - vs just a subset of shares being traded a lot - which is already happening EVERY DAY?
https://finance.yahoo.com/quote/GME/key-statistics/
(That daily volume also shows that if you think you're part of some group that's just buying and holding and reducing the volume of available shares... you might want to check again! Clearly there's a LOT of active selling going on.)
So what they do instead is to sell the stock to each other at super-low volumes in order to try to drive the price down, using their brokerage advantages to make it so the shares don't reach the open market. This is a ladder attack and it's responsible for every last one of the dips on the market. They wait until late in the day when people aren't really paying attention. They can sell to each other but that doesn't mean there's a lot of float. Don't let that fool you, there isn't.
It's not in the interest of the shorters to buy up all the shares that come on the market. That's effectively covering their position. It'll drive up the price massively. They want to get lots of people scared into selling so there's lots of float. Then they can manipulate the price down using media shills or whatever and then snap them all up at a bargain rate and use them to cover their positions. If it's not cheap then any collective buying will drive the price up tremendously, what's called the infinity squeeze.
You need a DISTINCT share in order to cover your position. One you own. That's the contract. They have to deliver it to the market maker which they took up the short position with. The market maker will then put that share back on the open market. If you want to deliver another stock, you need to buy it back from the market maker, at full market value, and deliver it back to the market maker. You can't just conjure up a share in order to cover with. High trade volume !== high float. It has to be an actual, honest-to-God share. If not you just defaulted to someone with way bigger pockets than you have.
There just aren't a lot of shares available. Volume can be incredibly high, as it was over the last few days, but that doesn't mean there's a lot of float. The vast majority of shares are in the hands of people with no interest in floating them. The trade volume that's happening right now is the same shares changing hands with people who are just now discovering the action. The shorters will do anything to liquidate the massive amount of shares being held by the degenerates, but they took their stock certificates and buried them in the desert.
vs
>They have to deliver it to the market maker which they took up the short position with. The market maker will then put that share back on the open market. If you want to deliver another stock, you need to buy it back from the market maker, at full market value, and deliver it back to the market maker. You can't just conjure up a share in order to cover with.
The second paragraph seems to be the opposite of the first: once you acquire it, you return it to close some of your position, and then it's for sale again... so you can return the same share N times, distinctness be damned? You clearly don't need distinctness for the TOTAL sum of all short positions, because then the math wouldn't work.
No, the person you returned it to isn't going to cut you a sweetheart deal, but they ARE a motivated seller because the price is so high right now.
Yes. At market prices. Another short seller offering $600 for the share you just delivered at $550? You don't get that share back to cover your position with. With no float supply on the market and infinite demand, you're stuck handing over ever larger amounts of money to your market maker to buy the same shares over and over again.
If they could cover their positions at current market rates, I bet they would. But the second they try, the price shoots up, because of all the HODLers keeping float down.
To summarize: between Monday and Thursday, retail investors bought 74,385,426 shares of GME and sold 75,105,358 shares (or slightly more than they bought). That really runs counter to the theory that retail investors are holding all the shares while the shorters are scrambling to find them.
[1] https://www.bloomberg.com/opinion/articles/2021-01-29/reddit...
Still an otherworldly amount of short positions coming due, and an awful lot of degenerates with diamond hands.
We don't know: * how many new short positions were opened * how many old ones were closed * what happened next to the shares involved in those transactions where retail investors moved 75M shares * where the shares came from in the trades where retail investors bought 74M shares
That's why Levine discusses many possible stories behind those numbers. The only real thing that many retail sales really does is contradict the "we're all HOLDING!!" story.
It could be that very little of that was closing the original Melvin positions... but we don't have evidence, do we? How can you prove that retail didn't sell 75M to people closing short positions, and then retail bought 74M back from the brokers those shares were returned to, while meanwhile, a bunch of new investors went short because 300 bucks is a bonkers price and they're betting they can wait it out a few months? Or anywhere in between?
Rinse and repeat over a few weeks and the positions are clear. It's expensive because there's lots of interest but the amount of float is allowing massive under-the-radar moves. Very soon people lose interest because there won't be much in the way of massive gains anymore
The fact that the price keeps picking back up after every single dip means only one thing. There's still massive pressure going on. If this market were rational, it would clear. It's not clearing. No way GME is worth $360.
If it weren't for the HODLers, the only thing that would drive the price back up would be news stories piquing interest. That's not what we're seeing here. It's picking right back up because the people the shorters wanted to sell, didn't.
I know people believe they know about who's doing what in specific, vs seeing just the aggregate numbers, but I haven't yet been convinced that anyone actually knows this. I'm seeing news coverage, I'm seeing people lobbying others to buy more, I'm seeing speculation about what short sellers are doing, I'm seeing people saying their newly going short... I'm not seeing up-to-the-minute specifics on "Melvin Capital has lost $X dollars" or "still holds Y short positions." Yet the logic behind the "squeeze" assumes that specific knowledge.
I see how what you say is a possible explanation for what we see. But I can also imagine other explanations.
The short sellers are betting that GME will go to 0.
One will win and the other will lose. The question is who has the edge?
Just look at what's happening with the market. Brokers are pulling all the shenanigans to convince normal people to sell. All the finance media are shilling for billionaire vulture short sellers. Has this ever happened in the history of finance?
Why are these things happening? Does it seem like the super smart billionaire vulture short sellers have the edge? If they do, why don't they come in and make moves to drive down the prices from current levels?
After all these millions of shares being traded, why is the short still above 100%
The reason it's so heavily shorted is because institutional investors believe that GME is an overvalued piece of shit. I don't know if it was overvalued last week, but I'm 100% confident that it is indeed overvalued this week.
I've been sorely tempted to short it myself... But I don't pick stocks, or play with options.