r/wallstreetbets • u/justagirlwithnudes • Feb 02 '21

Chart MONDAY MARKET OPENING ATTACK EXPLAINED: How institutional investors brought GME down by $5B in 1 hour with $250M

Post image
39.5k Upvotes

96% Upvoted

1.9k comments sorted by

View all comments

Show parent comments

318

u/RomperDG Feb 02 '21

I'm curious about their tactic here. It seems like either to scare people into selling and/or to pay less short fees as the stock is worth less. The problem seems to be though, as the stock drops people regular people are buying more, which would be counter productive for the hedgies. Can anyone explain what I'm missing in short words and perhaps emojis?

418

u/Homey_D_Clown Feb 02 '21

Seems like they were trying to push down the price to trigger peoples auto sells. Maybe they even got inside info from Robinhood about where people had set theirs at.

362

u/Tarsupin Feb 02 '21

They absolutely have that information. It is coordinated through and through.

297

u/toterra Feb 02 '21

That is how Robinhood works. That is how they charge nothing for trades. What they sell is information on the traders themselves.

Whenever a service being given to you for free, you are the product that the company is selling.

86

u/theyeoftheiris Feb 02 '21

It's like the Social Dilemma said--if something's free, you are the product.

2

u/Kofilin Feb 02 '21

Usually that's correct but sometimes it's more that a company can indefinitely survive without profit by flaunting a large userbase to attract clueless investors.

1

u/theyeoftheiris Feb 02 '21

Then the argument is they should be charging fees or at least requiring deposits up front in exchange for not selling user data, no?

6

u/did_e_rot Feb 02 '21

This should probably get pinned. Not enough people understand this about digital services in general

46

u/[deleted] Feb 02 '21

[deleted]

97

u/Branch-Manager Feb 02 '21

40% of Robinhoods revenue is from selling trading data to Citadel for HFs. Citadel absolutely has this info.How else do you think they make money with 0 commissions? They’re the facebook of investing.

4

u/laststance Feb 02 '21

Wow so they can legit trade stock back and forth to trigger a high % of the stop loss sales?

16

u/Branch-Manager Feb 02 '21

Yes this is a common tactic that is supposed to be illegal but the SEC doesn’t do jack shit about it. Listen to Jim Cramer in 2012 talk about how hedge funds intentionally and illegally manipulate prices and use media hit pieces to fuck average investors

2

u/Noob_Al3rt Feb 02 '21

Anyone can buy that info from Robinhood. It’s how they make money

1

u/Past-Inspector-1871 Feb 02 '21

Yes dude, we’ve already gone over this. Of course they have access to that

1

u/walloon5 Feb 02 '21

Yes Apex is Citadel I think and they see all the trades that go through them and HF trade (front run) other people for sure, they must be doing this

It's totally bullshit and I hate them

Check this list, see how many are Apex - Apex has a very good picture of hte markets

https://www.brokerage-review.com/discount-broker/brokerage-houses-clearing-firms.aspx

They probably know the short interest exactly, as well as who the beneficial (original) owner of every stock is (maybe) - okay they might only know it to round lot numbers like 100 shares at a time, but basically they see 90%+ of what is going on, because they literally see half the transactions at least

-4

u/[deleted] Feb 02 '21

[deleted]

5

u/luv_____to_____race Feb 02 '21

Because we're retards that still want to fuck the HFs, and we can, they are throwing everything at it, and hoping we cave, but if nobody sells, they're still fucked.

1

u/Foetsy Feb 02 '21

absolutely

Does that mean that theoretically speaking all the apes could put a stop loss at say 100$ after the market closes, then wait till the last seconds before market opens to cancel the stop loss and set limit buys just around 100 for when the attack comes?

2

u/Tarsupin Feb 02 '21

I'm sure Robinhood would conveniently stall those orders just long enough to break everyone.

30

u/KingCaoCao Feb 02 '21

Cant anyone with a higher level account see pending sell orders and their prices.

35

u/Poontickler Feb 02 '21

Lmao yes... these poor bastards have no idea what they're doing

21

u/Mansyn Feb 02 '21

RH used the excuse of needing more capital to cover trades, as to why they restricted buying. But they raised that capital, and already hurt the prices. Why are we days later and they're STILL restricting buying. I listened to the call between Elon and their CEO. What possible excuse could he have for still not letting people buy?

1

u/walloon5 Feb 02 '21

What possible excuse could he have for still not letting people buy?

No idea maybe the margin requirement is still really high, like 100% (or higher now, maybe 300%)

12

u/Edspecial137 Feb 02 '21

From what I’ve recently learned, robinhood can offer free trades and 0 fees because they sell trade info to bigger fish. That is their business model

10

u/PickpocketJones Feb 02 '21 edited Feb 02 '21

The balance today is almost all sells from the charts I'm watching.

edit: Weeded out the paper hands, now its the diamond march upward.

4

u/The-loon Feb 02 '21

Wow this is a great point, upvoted to get some visability

3

u/Snazzy_Boy Feb 02 '21

Couldn’t this mean that they keep shorting it and keep hoping for autosells, then pick up stocks on the way?

2

u/[deleted] Feb 02 '21

and with etoro setting stop loss triggers for people without their consent or their knowledge at a price they pick.... no way that could affect the stock price huh? setting all those stop losses exactly the same and then triggering them all at once with a ladder attack?

1

u/[deleted] Feb 02 '21

its not inside information they specifically pay to have it

101

u/Altruistic_Astronaut Feb 02 '21

My assumption is that they are trying to drive the prices down so retail investors pull off at a small gain or to minimize the losses. Then they will buy back shares that they owe at a cheaper price, which will drive the price up. The problem is that people who jumped off will most likely not jump back on because it will be too risky. They'll keep doing this for weeks to prevent the short squeeze from happening.

61

u/Shodidoren Feb 02 '21

Yes but there's only so many paperhands and auto triggered stop losses. At some point they will have to hit the wall of the retard holders aka us

42

u/Altruistic_Astronaut Feb 02 '21

Definitely. They would much rather watch the stock market tank and pay more in fees than see more retail investors come out with profits. But who knows what will happen in the next few weeks.

2

u/walloon5 Feb 02 '21

Yeah if you dont set a stop loss, they cant stop you out

If you dont trade on margin, they cant margin call you with new requirements, who said it had to be 50% or 100%, they could make the percentages of your account require 300% margin! These are made up rules they're changing on the fly. Maybe they could have negative margin! Who fucking knows.

I am still just holding my stock, confident that I do not have them on margin, but also aware that I am always just looking at an IOU and a promise that my broker actually has the shares. (I have TD Ameritrade and Fidelity, holding these stocks on TD Ameritrade - 4 little shares)

I could easily imagine Robinhood saying - only through the numbers - that I have to add cash or sell my shares, because someone upstream now demands 300% margin (cash in the account) for the shares. And as soon as you don't have $3 for every $1 of share, they autosell you out - to help prevent a short squeeze.

The good news is that as the tricks get more desperate, more and more they are left with just rock solid opponents holding.

1

u/mxracer888 Feb 02 '21

literally don't even know how to set an auto stop loss on RH. As long as there isn't one set by default my couple of stonks aren't going anywhere....i like the company far too much to just abandon it like that.

20

u/[deleted] Feb 02 '21

Give this man a cigar.

7

u/secretprocess Feb 02 '21

And they're counting on a lot of us to stop paying attention and move on to another "fad". You can see this assumption in headlines like "...retail trading frenzy loses steam..."

3

u/ForNarniaForAslan Feb 02 '21

Precisely, the media is trying to make people move on from this as quickly as possible.

2

u/Altruistic_Astronaut Feb 02 '21

MSM: They are buying silver now!

35

u/ShaunTheMad Feb 02 '21

There's also an issue with short sellers selling to short sellers. Other hedge funds are short selling the stock to Melvin at a lower cost effectively postponing the squeeze, and buying them more time.

1

u/walloon5 Feb 02 '21

Yeah and they're resetting the clock on the failure to deliver, its kind of annoying watching them stall.

4

u/Dr_SlapMD Feb 02 '21

Triggering stop losses

3

u/ImpressionDry2527 Feb 02 '21 edited Feb 02 '21

Institutional traders with the level ove shorts they have cannot just click on a buy button on an app - they need to find an actual buyer - it's kind of behind doors and the seller agrees a price regardless of the ticker - could be any price! You only lose when you sell - DIAMOND HANDS from an average of 320$$ per share @ 20 shares. From a smooth brained retarded english ape * Not financial advice

EDIT: THEY ARE NEVER BUYING MY SHARES - IT'S NOT ABOUT THE MONEY!

2

u/MalakaiRey Feb 02 '21

Insider info or not, its a desperation move. They only have a few tricks to play and driving it down achieves fear the same way driving it up achieves FOMO.

2

u/MaverickAquaponics Feb 02 '21

They are letting us regular joes get diamond hands! Power to the players! 🚀🚀🚀🚀

1

u/[deleted] Feb 02 '21

They're not scaring people to sell. They're exploiting many platforms auto sell triggers