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  • So are we done, here?

    GME off 31% today at closing, and down another 16% in after-hours. Did the Prisoner's Dilemma catch up to the bros?

    Or can they re-form ranks for another assault?
    If you don't change the world today, how can it be any better tomorrow?

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    • The volume of trading is quite low though. Meaning that most of the stock is being held. Sounds like the hedges were trading back and forth, manipulating the price.
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      • Originally posted by Jimjamesak View Post
        The volume of trading is quite low though. Meaning that most of the stock is being held. Sounds like the hedges were trading back and forth, manipulating the price.
        Is this because of an asymmetry between retail and hedges, or could retail (or institutional traders looking to gut the hedges) trade between themselves to push the price back up?
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        Comment


        • The stock price is whatever the last mutually agreed upon trade says it is.

          im not sure what the idea behind colluding to set price would be or the logistics. The market price is what the market price is.

          Even in low volume days, if someone is overselling, the market corrects that price. Vice versa if someone is buying. You don’t get to pick who you sell to or buy from on the open market. You pick and price.
          Code:
          As of 9/21/10:         As of 9/13/10:
          College Hockey 6       College Football 0
          BTHC 4                 WCHA FC:  1
          Originally posted by SanTropez
          May your paint thinner run dry and the fleas of a thousand camels infest your dead deer.
          Originally posted by bigblue_dl
          I don't even know how to classify magic vagina smoke babies..
          Originally posted by Kepler
          When the giraffes start building radio telescopes they can join too.
          He's probably going to be a superstar but that man has more baggage than North West

          Comment


          • Originally posted by dxmnkd316 View Post
            The stock price is whatever the last mutually agreed upon trade says it is.

            im not sure what the idea behind colluding to set price would be or the logistics. The market price is what the market price is.

            Even in low volume days, if someone is overselling, the market corrects that price. Vice versa if someone is buying. You don’t get to pick who you sell to or buy from on the open market. You pick and price.
            Then how do the hedges drive the price down?
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            Comment


            • Every trading party has a counterparty. The trade price varies according to supply and demand. Hedges are all looking to sell to deflate the price. All the redditers are looking to buy to inflate the price. The price moves up or down because of which side has more force.

              So what prevents the redditers from forcing up the price through their combined desire to buy? Buyers are by definition people with the money not the share, so the current configuration of share holding wouldn't matter. What prevents the redditers swamping the system with buy orders to overwhelm the hedges' sell orders?

              Does it come down to who has deeper pockets?

              tldr: how do the hedges execute a short ladder attack if a redditer is always willing to offer more on each trade?
              Last edited by Kepler; 02-01-2021, 11:50 PM.
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              • That’s my point
                Code:
                As of 9/21/10:         As of 9/13/10:
                College Hockey 6       College Football 0
                BTHC 4                 WCHA FC:  1
                Originally posted by SanTropez
                May your paint thinner run dry and the fleas of a thousand camels infest your dead deer.
                Originally posted by bigblue_dl
                I don't even know how to classify magic vagina smoke babies..
                Originally posted by Kepler
                When the giraffes start building radio telescopes they can join too.
                He's probably going to be a superstar but that man has more baggage than North West

                Comment


                • The mobius strip is complete. There is an r/MelvinCapitalLove and it is everything you will ever need.

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                  • Originally posted by Kepler View Post

                    Is this because of an asymmetry between retail and hedges, or could retail (or institutional traders looking to gut the hedges) trade between themselves to push the price back up?
                    Prices are based on the last recorded trade. If the redditers are all holding and the only trading is among the hedge funds, the price will slowly decline. And yes, vice versa, if the current reddit buyers are dominating the market, it'll jump.

                    Conceptually just remember the price isn't based on what most people would or did pay, but what the most recent person actually paid.

                    Comment


                    • Originally posted by unofan View Post

                      Prices are based on the last recorded trade. If the redditers are all holding and the only trading is among the hedge funds, the price will slowly decline. And yes, vice versa, if the current reddit buyers are dominating the market, it'll jump.

                      Conceptually just remember the price isn't based on what most people would or did pay, but what the most recent person actually paid.
                      What sets that price though? This means sellers are agreeing to sell their shares for less than the most current price?

                      Comment


                      • It’s a marketplace. Almost no difference than tracking the price of scalpers outside mariucci. You have a bid and an ask. Ask is what the scalpers are barking out, bid is what the guy with two kids is offering them. If a bid and ask match up, the sale closes and the price is reported as the market ticket price for the UMN ticker.

                        you could have someone ask a low price and they get matched up a market order (see below) and the transaction goes through and the price gets reported. What the scalpers doesn’t want is to ask a lowball and have it matched. It doesn’t make sense because it’s a loss and the next reported sale erases that price anyways. When you have 100 scalpers out front, all sorts of prices are negotiated and closed. Those are the various market prices and why a lot of transactions are based on the fair market value, usually the average between the day high and low.




                        but there are multiple types of orders for the average schmuck on fidelity.

                        if the scalper finds a person who puts in a “market order”, the sale happens at the ask more or less.

                        A season ticket holder could also tell the UofM, “look, if the price of any of my tickets gets to $300, sell it to whomever will take it and send me an email. I just want to lock in the profits”

                        there are also stop loss sales. That’s about 1/2 way through the first when the scalpers are losing money and will take anything instead of risking it all hoping for their original ask.

                        then the options market kicks in. You have people who sold tickets on stub hub but didn’t have the tickets. You can imagine someone being pretty angry they bought tickets and not having them delivered, so these contracts can make for wild swings in prices.

                        this is just a few of the examples.

                        all of this gets thrown out for actual floor traders. There are all sorts of trades and deals made there.
                        Last edited by dxmnkd316; 02-02-2021, 08:47 AM.
                        Code:
                        As of 9/21/10:         As of 9/13/10:
                        College Hockey 6       College Football 0
                        BTHC 4                 WCHA FC:  1
                        Originally posted by SanTropez
                        May your paint thinner run dry and the fleas of a thousand camels infest your dead deer.
                        Originally posted by bigblue_dl
                        I don't even know how to classify magic vagina smoke babies..
                        Originally posted by Kepler
                        When the giraffes start building radio telescopes they can join too.
                        He's probably going to be a superstar but that man has more baggage than North West

                        Comment


                        • Actually, that analogy gets even better. Options are no different than stubhub for an entire season. You have different dates for the contracts, usually they’re bundled (call it four seats on stubhub and 100 shares on an options contract). Stub hub charges you a transaction fee per ticket for the right to buy or sell. You just need to deliver the tickets, if necessary, on the date of the game.
                          Code:
                          As of 9/21/10:         As of 9/13/10:
                          College Hockey 6       College Football 0
                          BTHC 4                 WCHA FC:  1
                          Originally posted by SanTropez
                          May your paint thinner run dry and the fleas of a thousand camels infest your dead deer.
                          Originally posted by bigblue_dl
                          I don't even know how to classify magic vagina smoke babies..
                          Originally posted by Kepler
                          When the giraffes start building radio telescopes they can join too.
                          He's probably going to be a superstar but that man has more baggage than North West

                          Comment


                          • Originally posted by unofan View Post
                            Conceptually just remember the price isn't based on what most people would or did pay, but what the most recent person actually paid.
                            I think of it as a tub with the faucet (buyers) open and the plug (sellers) open. The water level is the price. As you adjust the faucet (loosen -- add or tighten -- subtract buyers) the water level rises or falls, respectively. As you adjust the plug (loosen -- add or tighten -- subtract sellers) the water level falls or rises, respectively.

                            If the hedges are placing thousands (millions? billions?) of sell offers to create a short ladder, why can't the redditers place thousands (millions? billions?) of buy offers to create a long ladder? None of the money is real anyway because the trades alternate with each buyer/seller pair alternatively wiping out their prior gain/loss, and there is no fee on the trade to erode their resources. They could post infinite dummy buy/sells. If this manipulation works for the hedges why doesn't it work in reverse for the redditers?

                            Is the asymmetry that the hedges can "borrow" shares and repeatedly trade them (hence 140% short) while the redditers actually have to have shares and money in hand to buy/sell?
                            Last edited by Kepler; 02-02-2021, 09:46 AM.
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                            Ivy League Champion 1966, 1967, 1968, 1969, 1970, 1971, 1972, 1973, 1977, 1978, 1983, 1984, 1985, 1996, 1997, 2002, 2003, 2004, 2005, 2012, 2014, 2018, 2019, 2020

                            Comment


                            • Originally posted by Slap Shot View Post

                              What sets that price though? This means sellers are agreeing to sell their shares for less than the most current price?
                              Yes. That is what it means.
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                              Comment


                              • Originally posted by Slap Shot View Post

                                What sets that price though? This means sellers are agreeing to sell their shares for less than the most current price?
                                If someone on here can explain this to me, I will GrubHub you a steak dinner. I have never found anyone who can explain to me how stock prices are actually set, including my MBA finance professors. They only think at the micro level, on an individual trade basis. What are the macro effects of all the buy and sell orders that are going on? Some simple examples that would illuminate a lot, for me at least:

                                Example 1: Say price is $50. 5 people say that they want to sell their combined 500 shares. 8 people say that they want to buy a combined total of 400 shares. I presume that the 400 shares trade hands at $50, but there are now an excess of 100 shares that want to be sold. Does that mean that "they" would drop the price to try to attract buyers for those 100 shares? If so, how quickly does the price drop? Do they knock off 1% and wait 1 minute, then drop another 1%? Or is it .1% every 3 seconds?

                                Example 2: Price is $50. 5 sellers put in standing orders to sell 500 shares at any price over $49. I put in an order to buy 400 shares. I assume I get those shares at $50. Then what happens to the price? Would they drop the price to $49 due to the "excess" standing sell orders, but no lower?

                                Example 3: Say price is $50. 10 people put in standing orders on 500 shares saying that they'll sell at any price over $55. I put in an order that I want to buy 100 shares, thinking that I'm going to get it for $50. Would "they" raise the price to $55 (due to the "excess" buy demand from me) to make those 100 trades happen (but I pay a 10% higher price than I expected)?

                                Example 4: Same as example 2, but my buy order included a cap that said I was not willing to pay any more than $50. Would they still raise the price to $51 (even though no trades would happen) since there was a greater signal from investors that the price should go up (as evidenced by the greater number of sell orders at $55 than they have for buy orders at $50)?

                                If you don't change the world today, how can it be any better tomorrow?

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