Talking Stocks 2.0

[Krash]

Originally Posted by BraveBold

It is also tacit collusion. When you -know- with extreme confidence that many other “apes” will pile in regardless of any investment thesis or underlying reason other than your post… that is collusion, even if done without active discussion. The whole group of “apes” acting in concert and in likelihood being additionally primed weeks ago by the “lean-in” meme is where Kitty may get cornered. The lean “seriousness” meme could be seen as signaling that the subsequent trade disclosure “should” be followed by the group piling in. The sole purpose to cause short sellers to cover and artificially drive the price up. This sole purpose and collusion is clearly manipulation. Anyone not recognizing that… well, not much to say there lol.

Whether it amounts to something that can be prosecuted, I will just defer to the regulators. They will certainly explore how to make this more clearly illegal in the future - and I hope they succeed.

Again, it’s a matter of style. It’s a fine line between what Roaring Kitty is doing on X vs what the financial analysts are doing when they announce their aggressive price targets on CNBC.


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[BraveBold]

Originally Posted by Krash

Again, it’s a matter of style. It’s a fine line between what Roaring Kitty is doing on X vs what the financial analysts are doing when they announce their aggressive price targets on CNBC.


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Apples and oranges.

Also, some “analysts” do manipulate the market. I’ve said it before - many commentators and analysts appear to focus on manipulation of prices. Crypto is rife with them and Cathy Wood is an exemplar of ill informed targets combined with herd following…

But kitty is in a different category, with a much more direct connection to his follower cohort, a more focused manipulation strategy and something that is clearly tacit collusion in terms of behavior.

Apples and oranges. Both fruits, in this case both rotten. Not the same flavor. I think I’ve stated several times, I am not convinced he will be convicted or necessarily charged… but it is clearly manipulation and in fact of a different degree and form than the other examples.

[Krash]

Originally Posted by BraveBold

Apples and oranges.

Also, some “analysts” do manipulate the market. I’ve said it before - many commentators and analysts appear to focus on manipulation of prices. Crypto is rife with them and Cathy Wood is an exemplar of ill informed targets combined with herd following…

But kitty is in a different category, with a much more direct connection to his follower cohort, a more focused manipulation strategy and something that is clearly tacit collusion in terms of behavior.

Apples and oranges. Both fruits, in this case both rotten. Not the same flavor. I think I’ve stated several times, I am not convinced he will be convicted or necessarily charged… but it is clearly manipulation and in fact of a different degree and form than the other examples.

I agree it’s apples and oranges and like you said, both are still fruits. But I don’t think they’re both rotten.

I’m glad people go on CNBC and give their opinions on target prices for stocks. I’m glad people go on YouTube and provide a detailed analysis of a specific stock and offer opinions on target prices.

In terms of the GME phenomenon, it is unique. That’s for sure.


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[BraveBold]

Originally Posted by Krash

I agree it’s apples and oranges and like you said, both are still fruits. But I don’t think they’re both rotten.

I’m glad people go on CNBC and give their opinions on target prices for stocks. I’m glad people go on YouTube and provide a detailed analysis of a specific stock and offer opinions on target prices.

In terms of the GME phenomenon, it is unique. That’s for sure.


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The rotten aspect isn’t all opinions. It is when the targets are motivated by the desire to influence and manipulate without basis. As someone who previously provided trading recommendations to clients AND someone who traded a proprietary book in a bank, I have no bias against analysts.

Crypto analysts who called $250k/btc for 2023 knew their audience. Those “price targets” had on goal in mind, and it was not to share some sort of fundamental insight but rather drive price action itself.

[SDGT3]

I'm not sure a random analyst who is filler on CNBC is going to move the NVDA market share much. However, if someone like Buffett comments, he may move the market. Perhaps I'm wrong, but I'm going to put the move on NVDA on the fact today is the last day to hold a position before the 10 to 1 stock split and the fundamental surrounding that company's position within the AI space.

Speaking of fundamentals, for someone who looks at investing from a logical stand point, at least tries to, and doesn't really operate in the options space, it's absolutely fascinating watching people try and make their money on these companies like AMC and GME. The fundamentals are awful and speculators are playing in an arena where professionals are just sucking them in to be had.

[huncho]

well he's up 400m now

[enjoythemusic]

Originally Posted by Krash

In terms of the GME phenomenon, it is unique. That’s for sure.

Imagine if Goldman Sachs, JP Morgan, BlackRock... and of course CNBC... all started ensuing the price of oil went down and stayed at around $40 / barrel. We'd even get HFT front-runners like Virtu Financial and Citadel Securities aboard. Surely the major benefits globally make it very fair to all.

[BraveBold]

Originally Posted by huncho

well he's up 400m now

Likely a tad less now.

[Krash]

After their earnings report and announcing a 10 for 1 stock split, Broadcom is up in pre hours trading by 13%.

I don’t think it’s a pure AI play like Nvidia is. It’s networking and VMWare, right?

Either way, I’m glad I have it in my portfolio.




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[In-N-Out]

I'm an idiot and bought a few hundred shares at $43 a week ago lol. I DCA'd down to $33. I hope I can break even on GME lol. lost about $20k during pandemic on meme stocks. made the same mistake this time around

[7sins]

Originally Posted by In-N-Out

I'm an idiot and bought a few hundred shares at $43 a week ago lol. I DCA'd down to $33. I hope I can break even on GME lol. lost about $20k during pandemic on meme stocks. made the same mistake this time around

Try to use stop losses in the future, it will limit your losses, especially for stocks you are not planning to hold for the foreseeable future.

[In-N-Out]

Originally Posted by 7sins

Try to use stop losses in the future, it will limit your losses, especially for stocks you are not planning to hold for the foreseeable future.

Yea I use limits of course on real investments. This one is just for fun and gambling (although losing money is not fun)

[hambone1983]

I worked in the securities industry. I would not defer to regulators, most of whom cannot find their arse with both hands. I mean, Bernie Madoff was audited multiple times and no one bothered to look at his firm's DTC account which was completely empty or noticed that customer deposits were going into his personal account at Chase Manhattan.

[BraveBold]

Originally Posted by In-N-Out

I'm an idiot and bought a few hundred shares at $43 a week ago lol. I DCA'd down to $33. I hope I can break even on GME lol. lost about $20k during pandemic on meme stocks. made the same mistake this time around

It is unfortunate that the market has gone from the proverbial casino to a literal one.

The mis-allocation of capital is harmful. It already occurs as a natural byproduct of the system but when it’s done intentionally (like in meme stocks) it is a whole new level of unfortunate.

Imagine the myriad better uses that a few billion dollars of funds could be put to (cancer or diabetes research, or even funding the next Adam Sandler project) rather than going into a dying retailer’s investments account.

Roaring Kitty should have just setup a gofundme for his followers to donate to, with a promise to randomly pay out 50% back to a random selection of “entrants” in his lottery.

[Krash]

Originally Posted by hambone1983

I worked in the securities industry. I would not defer to regulators, most of whom cannot find their arse with both hands. I mean, Bernie Madoff was audited multiple times and no one bothered to look at his firm's DTC account which was completely empty or noticed that customer deposits were going into his personal account at Chase Manhattan.

I can attest to that. Regulators walk around the building with a magnifying glass that they’re sticking up everyone’s arse. But yet they couldn’t see a gaping problem if their life depended on it.


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[In-N-Out]

Originally Posted by Krash

I can attest to that. Regulators walk around the building with a magnifying glass that they’re sticking up everyone’s arse. But yet they couldn’t see a gaping problem staring at them right in their face.


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What can SEC or other regulatory bodies do to prevent this gamestop scenarios? I think this meme stonks situation is a black swan event (period between covid time and now) escalated by stimmy checks given to unsophisticated retail investors, low interest rates, and of course WSB/social media influence. I don’t expect to see these things happen regularly, at least not at this magnitude.

But still, what can the SEC do? It’s simple supply and demand

[huncho]

Originally Posted by In-N-Out

What can SEC or other regulatory bodies do to prevent this gamestop scenarios? I think this meme stonks situation is a black swan event (period between covid time and now) escalated by stimmy checks given to unsophisticated retail investors, low interest rates, and of course WSB/social media influence. I don’t expect to see these things happen regularly, at least not at this magnitude.

But still, what can the SEC do? It’s simple supply and demand

the biggest issue with gamestop was that 140% of its float was shorted and the sec allowed it to happen while parading that they're all about protecting investors at the same time. they were basically shorting fake shares and when it blew up there was no way they could fight back. nowadays the most shorted stocks usually have about half their float shorted so i doubt we'll ever see 2021 gme happen again

[BraveBold]

Originally Posted by In-N-Out

What can SEC or other regulatory bodies do to prevent this gamestop scenarios? I think this meme stonks situation is a black swan event (period between covid time and now) escalated by stimmy checks given to unsophisticated retail investors, low interest rates, and of course WSB/social media influence. I don’t expect to see these things happen regularly, at least not at this magnitude.

But still, what can the SEC do? It’s simple supply and demand

A repeating event hardly qualifies as an outlier of that sort - too much time has passed between the individual variants of this same issue (for me) to characterize as such. We have also seen irrationality of similar proportions and similar manipulations, just in different forms (think equity analyst cohort circa 1998-2000).

We have seen certain institutional behavior of similar type in the early 2000s (hedge fund “wolf packs” utilizing options to avoid regulatory constructs, particularly in the activist space). I wrote several papers on the topic and some ideas were adopted (whether I had an impact or not… who knows) and it curtailed the behavior.

In that case it was innovative use of existing tools + market appetite and opportunity that drove behavior - behavior that was not contemplated in existing rules. Regulators are generally slow to adapt - and politics is often in the background (sometimes foreground).

What could be done in this case? I haven’t given it much thought but there are certainly solutions out there - whether there is appetite to expend political capital to support change… a completely different question.

[BraveBold]

Originally Posted by huncho

the biggest issue with gamestop was that 140% of its float was shorted and the sec allowed it to happen while parading that they're all about protecting investors at the same time

This was the catalyst. Legitimate analysis by Burry identified this (and others caught on).

The subsequent meme stock behavior, including using public forums for group pile-ins, etc… related but its own issue in my opinion.

[In-N-Out]

Originally Posted by BraveBold

A repeating event hardly qualifies as an outlier of that sort - too much time has passed between the individual variants of this same issue (for me) to characterize as such. We have also seen irrationality of similar proportions and similar manipulations, just in different forms (think equity analyst cohort circa 1998-2000).

We have seen certain institutional behavior of similar type in the early 2000s (hedge fund “wolf packs” utilizing options to avoid regulatory constructs, particularly in the activist space). I wrote several papers on the topic and some ideas were adopted (whether I had an impact or not… who knows) and it curtailed the behavior.

In that case it was innovative use of existing tools + market appetite and opportunity that drove behavior - behavior that was not contemplated in existing rules. Regulators are generally slow to adapt - and politics is often in the background (sometimes foreground).

What could be done in this case? I haven’t given it much thought but there are certainly solutions out there - whether there is appetite to expend political capital to support change… a completely different question.

Link to the papers? I’m not a trader so obviously I’m not as educated on this topic. But do you reject the EMH? I assume in the one run, market fundamentals beat out any nonsense technical analysis including whatever “arbitrage” opportunities one may think exists, including any short interest/volume

[BraveBold]

Originally Posted by In-N-Out

Link to the papers? I’m not a trader so obviously I’m not as educated on this topic. But do you reject the EMH? I assume in the one run, market fundamentals beat out any nonsense technical analysis including whatever “arbitrage” opportunities one may think exists, including any short interest/volume

No link as I’m not one for sharing too much private info. The papers were related to using flagging approaches (disclosures rather than outright restrictions). My papers (on this topic) were not published but were presented to individuals who did play a role in the regulations (which is why I mention that I don’t know if they had an impact or not).

My opinion on EMH is it is far from strong and perhaps not even semi-strong. Part of this has to do with how markets digest information, some technical factors (etfs, fund behaviors, other constraints, frictions) and part has to do with balance of psychological vs fundamental factors.

Over time divergence usually transforms to convergence around a reasonable value - but the easy way to summarize is the quote of the market in the short term being a “voting machine” vs a “weighing machine” in the long run… and also that in the long run we’re all dead :-)

[BraveBold]

Just to be clear - I was never a regulator. Nor would I ever want to be.

[Krash]

I saw someone from the SEC being interviewed on CNBC earlier in the week. She said there is nothing they can legally do about Roaring Kitty and no action will be taken. But I suppose that is something we should take with a grain of salt.


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[BraveBold]

Originally Posted by Krash

I saw someone from the SEC being interviewed on CNBC earlier in the week. She said there is nothing they can legally do about Roaring Kitty and no action will be taken. But I suppose that is something we should take with a grain of salt. It’s not entirely uncommon for government officials to say one thing and then the exact opposite thing happens.


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My guess is they are digging and exploring concurrent factors.

It will fall on whether Roaring Kitty was smart or dumb in terms of what he discussed with others over the accumulation period to current…

He clearly intentionally engaged in manipulating the market for GME. That is under a general (non-legal) definition of manipulation based on publicly available information and within historical context. Put simply, he clearly should have expected certain outcomes from his actions that would be unrelated to any reasonable view of GME’s intrinsic value. Now, whether it was illegal manipulation - that is the question and where the regulatory gap exists.

All of the above is my opinion - and not my legal opinion. I could be far off :-)

[BraveBold]

Anyone starting to scale down NVDA holdings? I am seriously considering slowly divesting direct holdings and only retain my indirect (through a couple ETFs). In particular because the weight in my ETFs has skewed over-concentrated.

I don’t buy the long-term thesis (metrics reaching levels implied by current valuation) but at the same time I could be wrong…

Thoughts?

[Redfoot]

Originally Posted by In-N-Out

I'm an idiot and bought a few hundred shares at $43 a week ago lol. I DCA'd down to $33. I hope I can break even on GME lol. lost about $20k during pandemic on meme stocks. made the same mistake this time around

Today might be your day to exit if you wish- already touching $30 off the bell.

Just don't cut yourself with those paper hands you got.....

[In-N-Out]

Originally Posted by Redfoot

Today might be your day to exit if you wish- already touching $30 off the bell.

Just don't cut yourself with those paper hands you got.....

I actually bought more @ open lol. Brought my basis way down. Might exit today. Maybe Monday. Maybe HODL ?

[RTG]

Originally Posted by BraveBold

Anyone starting to scale down NVDA holdings? I am seriously considering slowly divesting direct holdings and only retain my indirect (through a couple ETFs). In particular because the weight in my ETFs has skewed over-concentrated.

I don’t buy the long-term thesis (metrics reaching levels implied by current valuation) but at the same time I could be wrong…

Thoughts?

With each jump I increase the Stop Price of my Stop Loss order. Have been expecting to own zero shares but it hasn't happened yet.

[enjoythemusic]

Originally Posted by BraveBold

He clearly intentionally engaged in manipulating the market for GME. ...
All of the above is my opinion - and not my legal opinion. I could be far off :-)

:) :)

I say the same about Jim Cramer and his pumping of Apple over many, many years. CNBC is a known..... Look forward to regulators visiting CNBC staff members.... uh huh... sure... lol.

[huncho]

Originally Posted by In-N-Out

I actually bought more @ open lol. Brought my basis way down. Might exit today. Maybe Monday. Maybe HODL ?

dca'ing into trash is the fastest way to lose money. i learned this the hard way in 2022 lol, good luck