GME
'Gamestonk!!' - Musk joins the retail bros' battle against Citron
- After surging over 90% yesterday back to the $150 level, GameStop
(NYSE:GME) got another boost from a well-known short-seller battler -
Elon Musk. It only took a one-word tweet from the master troller,
"Gamestonk," to propel GME shares another 46% to $217 in after-hours
trading (the stock is up 1000% since Jan. 12) The Tesla (NASDAQ:TSLA)
CEO has fought with the shorts for years over the future of the EV maker,
but many were forced to admit defeat last year.
- *Backdrop:* Citron Research's Andrew Left, the famed short-seller (or
infamous according to the retail bros), has a long history of opining on
Tesla, shorting shares at least as early as in 2013. Left had a big turn
of
heart in October 2018, when he took a long position and said "the story
has
become too compelling to ignore," but just before the big run-up in 2020,
he announced that Musk would even short the electric car maker at this
level. "This is no longer about the technology, it has become the new
Wall
St casino," Left declared, though TSLA surged another 400% since then.
- *Statistics: *Tesla had long been a favorite play for shorts, which
controlled about 19% of shares at the start of 2020. About two-thirds of
the positions were unwound over the course of the year after recording
$40.1B in losses. In fact, the losses endured by Tesla shorts were more
than the short losses for the next nine companies - combined. Meanwhile
short interest of GameStop has held steady at a massive 140% of the
float,
leading to trouble for some hedge funds. Melvin Capital has required a
$2.75B cash infusion from Citadel and Point72 to help it weather the
losses
from its GME short position (it also held put options on Tesla for
years).
- After promising not to comment on GameStop after attacks from the
"angry mob" (a.k.a. the "Wall Street Bets" Reddit forum), Citron's Andrew
Left doubled down on his position. "If I had never been involved in
GameStop and came to this right now, would I still be short this stock?
100
percent," Left told Reuters, adding that he "created this game, based on
uncovering the truths, so I can't get mad at people for taking the other
side." But as the retail bro army rallies the troops, he may be left
holding the short short end of the stick and nursing millions in losses.
Will Musk and the r/wallstreetbets subreddit have the last laugh?
- *Update (4:00 a.m. ET):* GME shares have opened the premarket session
up
55% to $230 per share.
- *Update (6:00 a.m. ET):* GameStop is now up 104% to over $300/share.
|Today, 3:59 AM|71 Comments
'Gamestonk!!' - Musk joins the retail bros' battle against Citron
- After surging over 90% yesterday back to the $150 level, GameStop
(NYSE:GME) got another boost from a well-known short-seller battler -
Elon Musk. It only took a one-word tweet from the master troller,
"Gamestonk," to propel GME shares another 46% to $217 in after-hours
trading (the stock is up 1000% since Jan. 12) The Tesla (NASDAQ:TSLA)
CEO has fought with the shorts for years over the future of the EV maker,
but many were forced to admit defeat last year.
- *Backdrop:* Citron Research's Andrew Left, the famed short-seller (or
infamous according to the retail bros), has a long history of opining on
Tesla, shorting shares at least as early as in 2013. Left had a big turn
of
heart in October 2018, when he took a long position and said "the story
has
become too compelling to ignore," but just before the big run-up in 2020,
he announced that Musk would even short the electric car maker at this
level. "This is no longer about the technology, it has become the new
Wall
St casino," Left declared, though TSLA surged another 400% since then.
- *Statistics: *Tesla had long been a favorite play for shorts, which
controlled about 19% of shares at the start of 2020. About two-thirds of
the positions were unwound over the course of the year after recording
$40.1B in losses. In fact, the losses endured by Tesla shorts were more
than the short losses for the next nine companies - combined. Meanwhile
short interest of GameStop has held steady at a massive 140% of the
float,
leading to trouble for some hedge funds. Melvin Capital has required a
$2.75B cash infusion from Citadel and Point72 to help it weather the
losses
from its GME short position (it also held put options on Tesla for
years).
- After promising not to comment on GameStop after attacks from the
"angry mob" (a.k.a. the "Wall Street Bets" Reddit forum), Citron's Andrew
Left doubled down on his position. "If I had never been involved in
GameStop and came to this right now, would I still be short this stock?
100
percent," Left told Reuters, adding that he "created this game, based on
uncovering the truths, so I can't get mad at people for taking the other
side." But as the retail bro army rallies the troops, he may be left
holding the short short end of the stick and nursing millions in losses.
Will Musk and the r/wallstreetbets subreddit have the last laugh?
- *Update (4:00 a.m. ET):* GME shares have opened the premarket session
up
55% to $230 per share.
- *Update (6:00 a.m. ET):* GameStop is now up 104% to over $300/share.
|Today, 3:59 AM|71 Comments
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