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Gamestop Discussion
Posted: Sat Jan 23, 2021 1:23 am
by MajesticSoup
I was gonna originally put this into "stock market investing," but it occurred to me that this is NOT an investment in the context of the last few days. Long term, who knows, but right now I think this stock is worth a discussion.
Gamestop just went up as much as 78% yesterday. (Source:
https://markets.businessinsider.com/new ... 1029994276)
As of now, short interest is at a staggering 138% (source:
https://www.highshortinterest.com/). This means that there are more shorts than there are shares available. The short squeeze hasn't happened yet, but once it does, I think we will easily see even greater gains followed by a falling knife-like drop.
Even if you have no intention of buying GME, I think we are living through some really fascinating times. I think I'll move 30% of my play portfolio into it Monday, and set a limit sell at 100% profits. The big risk for us is that the shares take 2-3 days to arrive in our accounts, which is very long in the context of these events.
Re: Gamestop Discussion
Posted: Sat Jan 23, 2021 1:58 am
by Kanto
MajesticSoup wrote: ↑Sat Jan 23, 2021 1:23 am
I was gonna originally put this into "stock market investing," but it occurred to me that this is NOT an investment in the context of the last few days. Long term, who knows, but right now I think this stock is worth a discussion.
Gamestop just went up as much as 78% yesterday. (Source:
https://markets.businessinsider.com/new ... 1029994276)
As of now, short interest is at a staggering 138% (source:
https://www.highshortinterest.com/). This means that there are more shorts than there are shares available. The short squeeze hasn't happened yet, but once it does, I think we will easily see even greater gains followed by a falling knife-like drop.
Even if you have no intention of buying GME, I think we are living through some really fascinating times. I think I'll move 30% of my play portfolio into it Monday, and set a limit sell at 100% profits. The big risk for us is that the shares take 2-3 days to arrive in our accounts, which is very long in the context of these events.
I would argue the risk is immense. There is a lot of money on each side of this bet.
A single big player can decide to take profit, sell, and it could easily trigger a cascade of sales. A stop-loss probably would not help you with a huge incoming order flow.
Would you bet against institutional investors? Do you believe that the retail investors betting against the short sellers will stand firm with
"diamond hands"? Are you happy holding the stock for X years if it drops and having to wait for it to maybe one day recover?
(Note: I went BB/AMC for 50% of my playfund. It is working out well so far. I was considering GME but I did not think I could get the timing right due to timezones. I think this is a stock you need to be glued to are you will get stuck holding the bag.)
Re: Gamestop Discussion
Posted: Sat Jan 23, 2021 3:41 am
by captainspoke
This is not my thing, but one really nice aspect of being US and have a good broker there is that you can trade online in real time throughout the trading day, yourself. (Given that you're willing to stay up at night, and if you're betting on GME, the adrenaline will probably be flowing.) Yes, you're presuming good execution, but certainly no game of "telephone" with a local broker trying to get something done, waiting days to see what happened...
Not to mention the ARK funds, or things actually mainstream, like IGV.
Re: Gamestop Discussion
Posted: Mon Jan 25, 2021 5:44 am
by MajesticSoup
OkLah! wrote: ↑Sat Jan 23, 2021 4:40 am
Example of short squeeze in 200& for VW - not an esoteric company in the least and yet..
The chart suggests that in the short term, a short squeeze will pretty much guarantee most people some level of return.
You'd have to be several weeks too late cashing out as it's going down for you to be in the red. The chart timescale is big.
Short interest is rumored to be 140% as of this writing. I might try this play, despite us having to wait 3 days for a stock to arrive in our accounts. Wish me luck!
Re: Gamestop Discussion
Posted: Mon Jan 25, 2021 6:01 am
by Kanto
OkLah! wrote: ↑Mon Jan 25, 2021 5:51 am
Not sure meaning of 3 days to arrive in account?
When you buy a stock you are in risk from this very moment on. The fact that the settlement takes longer does not change that fact.
I think he may be talking about waiting for funds to settle before he can purchase?
I do no know of any trading platform that has that long of a delay.
Sound like the time it takes international mutual funds to settle in Japan (2-3 days).
Re: Gamestop Discussion
Posted: Mon Jan 25, 2021 8:34 am
by MajesticSoup
OkLah! wrote: ↑Mon Jan 25, 2021 5:51 am
Not sure meaning of 3 days to arrive in account?
When you buy a stock you are in risk from this very moment on. The fact that the settlement takes longer does not change that fact.
As far as I know, Rakuten takes 3 business days. Here is the source:
https://www.rakuten-sec.co.jp/web/info/ ... 22-01.html
This means that upon locking in my purchase, I cannot sell for the full 3 days until they "arrive" in my account. Am I misunderstanding?
Re: Gamestop Discussion
Posted: Mon Jan 25, 2021 9:06 am
by Kanto
MajesticSoup wrote: ↑Mon Jan 25, 2021 8:34 am
OkLah! wrote: ↑Mon Jan 25, 2021 5:51 am
Not sure meaning of 3 days to arrive in account?
When you buy a stock you are in risk from this very moment on. The fact that the settlement takes longer does not change that fact.
As far as I know, Rakuten takes 3 business days. Here is the source:
https://www.rakuten-sec.co.jp/web/info/ ... 22-01.html
This means that upon locking in my purchase, I cannot sell for the full 3 days until they "arrive" in my account. Am I misunderstanding?
受渡日
当社約定日※2から起算して3営業日目（T＋2）
※2 当社約定日は、米国市場の約定日の翌国内営業日となります。
https://www.rakuten-sec.co.jp/web/forei ... rules.html
Go figure. I would not use them for this type of trade then.
IBKR perhaps.
However, if you have a margin account you may be able to trade before delivery. I am uncertain.
Re: Gamestop Discussion
Posted: Mon Jan 25, 2021 9:42 am
by adamu
This is complete speculation, because I've not actually tried to do this.
I suspect the 受渡日 for stocks is the date they take the money out of your account. So although you can sell the stocks immediately after you bought them, you need to have the funds in your account until the 受渡日. If you sold them for a loss, you only need to keep the balance of the loss amount.
This looks relevant:
https://faq.rakuten-sec.co.jp/ifa/faq_d ... id=2111072
Re: Gamestop Discussion
Posted: Mon Jan 25, 2021 11:17 pm
by MajesticSoup
adamu wrote: ↑Mon Jan 25, 2021 9:42 am
This is complete speculation, because I've not actually tried to do this.
I suspect the 受渡日 for stocks is the date they take the money out of your account. So although you can sell the stocks immediately after you bought them, you need to have the funds in your account until the 受渡日. If you sold them for a loss, you only need to keep the balance of the loss amount.
This looks relevant:
https://faq.rakuten-sec.co.jp/ifa/faq_d ... id=2111072
Oh shoot, thanks a lot! I stand corrected and you guys are right. So yesterday night was quite the roller-coaster. It's pretty fun--feels like a casino. By no means a solid investment, but I think it's gonna take me being burned to learn not to play with fire.
Re: Gamestop Discussion
Posted: Mon Jan 25, 2021 11:52 pm
by RetireJapan