This is true, but I think Tesla monetizing its stock, either through a public offering or an acquisition, is the biggest risk for a short seller at this point. So it’s definitely what I would be afraid of.
Bear in mind that my shorting record is dismal. I have lost money shorting both A&P and Kodak - two companies that went bankrupt.
Depends on the acquisition. If they’re buying Ford it could easily crush the value of their stock because their stock value is based on like 30%+ year over year sales growth expectations over a decade. And Ford helps them with that how, exactly? So any acquisition would have to fit into the narrative of helping them achieve that sales growth.
Certainly could be smart to offer a few tens of billions of dollars worth of additional stock though. Or maybe they could just buy Panasonic.
It must be up like 2000% since toothsayer put it on his “no brainer to short unless you’re a stupid cuck” list.
Last time I took out a temp loan from my IRA, you had 60 days to repatriate the money in an IRA to avoid the 10% penalty. Not sure if the tax hit is a different window.
You need to be experiencing financial hardship related to coronavirus. You probably want to read up on what that means.
I still don’t believe in TSLA which is why I just can’t buy a share ever but i also am very thankful I was never dumb enough to short it.
One of these days I’ll learn to just bet against the train of morons in stocks like I do on some betting markets.
Meanwhile my FXE just chugs along at another ho-hum .55% today.
Why anyone listens to the most obvious Mom’s basement paper investor boggles my mind. His location (BFI THOUGHT LEADER) is sooooo tilting.
Exactly, so we’d better get our money in on them while we can! Stonks!
Username checks out!
You know, I had basically asked Mr PPT about that, then he had some long-winded reply that I don’t think answered the question. If I submit an order for one contract at $100 when there are 50 contracts available at $100, there’s nothing to front-run unless an entity wants to buy 50 contracts just to sell one back to me at $100.25 or w/e. That wouldn’t be worth it for them unless they were gonna buy at $100 anyway. Is my understanding correct?
Economically, this wouldn’t make any sense, since you’re eating the spread on 100 contracts just to fleece the customer.
It’s also very illegal for exchange-traded securities. The broker is required to route the order to someone who will execute it at a price at least as good as the best price on any exchange. So if there’s an ask at 100, sending the order to a hedge fund at 101 is nakedly illegal.
The actual explanation is that everyone on Robinhood is a complete fucking moron, so any hedge fund will be happy to sell to them at 100 + epsilon and buy at 100 - epsilon all day long. That’s too dangerous on a public exchange because you might run into someone who’s smarter than you, but it’s fine on Robinhood. The tricky thing is that if there’s an ask on the exchange at 1.02 one hedge fund is asking at 1.01 and a third is asking at 1.001, it’s basically fine to send the order to the hedge fund asking 1.01 in exchange for a sack of cash for Robinhood. It’s probably not actually fine if it’s that blatant, but you can do the same basic thing by how you negotiate the agreement with the hedge funds in the first place.
Can’t wait to incorporate this into my PhD class on capital markets. Just going to have to edit Kyle (1985) modestly:
In the particular model we investigate, one risky asset is exchanged for a riskless asset among three kinds of traders: a single insider who has unique access to a private observation of the ex post liquidation value of the risky asset;
uninformed noise traders who trade randomlycomplete fucking morons on Robinhood; and market makers who set prices efficiently (in the semi-strong sense) conditional on information they have about the quantities traded by others. Trading is modelled as a sequence of many auctions, structured to give the model the flavor of a sequential equilibrium as described by Kreps and Wilson [4].
Kyle, A. S. 1985. Continuous Auctions and Insider Trading. Econometrica 53 (6): 1315–1335.
Berkshire Hathaway currently owns 245 million shares of Apple valued at about $114 billion. Apple stock has gone up 60% this year, while Berkshire is down 8%. The value of Berkshire’s Apple stock now represents roughly 23% of total Berkshire market value.
I have an overweight position in Berkshire - Someone talk me out of shorting away part of Berkshire Hathaway’s exposure to Apple.
I suggest liquidating all assets and buying KIRK as it is up another cool 20% today.
An elegant way to avoid the constructive sale rules!
I guess that’s why BRKB shoots up some days when the market is down.
I don’t think I want a huge portion of my portfolio in BRKB. I’ve always avoided AAPL because of too many fanboys.
My company is up 14% today and I made a STONKS reference during our planning meeting with 20 people and no one knew what I was talking about. 
