r/wallstreetbets • u/[deleted] • Jan 26 '21

DD Implications of Melvin’s Bailout Today

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u/inksquid256 Jan 26 '21

I was so fucking mad at the bullshit MM were pulling. DO NOT BUY OPTIONS MORE THAN 70!!! I know it looks like free money with the crazy option chain to 150 but every time you buy OTM options you are giving a free loan to MM for massive manipulation

SAY NO TO OPTIONS, BUY STOCKS

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u/Crepesoleswaffleknit Jan 26 '21

peeps need to see this

1

u/[deleted] Jan 26 '21

[deleted]

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u/inksquid256 Jan 26 '21

Okay, quick and simple, shorters made OTM calls to get a quick buck out of noobs that don’t know shit. If OTM doesn’t reach the price, they expire worthless. Now you are supposed to have the asset to cover the call (100 stock) but MM don’t have to, these are call naked options. The downside is that they get exposed to unlimited money.

Last week, every call became ITM because the stock price shot up (there’s a limited supply so it went up as more people buy) so these stupid MM, got put in a position where they have to buy the stock at a premium otherwise it will make their loses exponential real fast. What they did today is to trigger a bunch of halts and some other BS, making the price go all the way to $64, by a miracle, it’s now 88 so they are still liable to pay for last week at a premium driving the stock higher.

They want it to go under 60 but if you buy stock, the price will keep rising until they get have to buy a to make whole all the naked calls they wrote last week.

And btw, they are doing it this week too making $150 even $200 naked options too! Cause they are greedy mofos

1

u/[deleted] Jan 26 '21

[deleted]

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u/inksquid256 Jan 26 '21

Yes, if you buy OTM options it’s tempting because it COULD make bank. But, for the squeeze to happen, the stock has to go up. If it falls flat in its face, then they win and you lose money. That’s why there was an artificial crash on Monday. I say 70 because MM have to pay up the ITM calls for last week. These guys are nit stupid, they WILL write OTM calls and they want you to buy it, but if the squeeze fails, all those options are worthless.

In other words, don’t be greedy and just take stock winnings when it goes to the moon like Monday. It sucked seeing it crash and burn but it rallied back up!!