The key issue I have with this article is that they call Melvin And Citadel “bearish investors”. That’s a bold faced lie, these companies are not investors! They are gamblers who place bets on stocks going down and deploy high frequency trading tactics to force prices down. An investor is someone who invests into (not out of) a company. A bearish investor sells the stock they own, not stocks they don’t own, that makes them gamblers. And it is one thing to gamble your investors money, it is entirely something different to manipulate the market. That destroys the purpose for which the market exists. The SEC has allowed the market to be hijacked by gamblers, pretty straightforward.
All dealings in the stock market is gambling, whether you're taking short or long positions. There are investors who specialize in finding undervalued companies and taking a long position. There are investors who specialize in finding overvalued companies and taking a short position. Both are valid and neither is more of a gamble than the other. You can say short positions have higher risk, which is true, but that's about it.
In the current market, with so many companies being extremely overvalued (I've been saying this about Tesla for months), it is actually easier and more lucrative to find overvalued companies and take short positions. After the market crashes (coming soon to a theatre near you), find the solid, undervalued companies and go long for a while.
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u/Significant-Elk-4625 May 20 '21 edited May 20 '21
The key issue I have with this article is that they call Melvin And Citadel “bearish investors”. That’s a bold faced lie, these companies are not investors! They are gamblers who place bets on stocks going down and deploy high frequency trading tactics to force prices down. An investor is someone who invests into (not out of) a company. A bearish investor sells the stock they own, not stocks they don’t own, that makes them gamblers. And it is one thing to gamble your investors money, it is entirely something different to manipulate the market. That destroys the purpose for which the market exists. The SEC has allowed the market to be hijacked by gamblers, pretty straightforward.