So, another high-flying company is being pummeled in the stock market.
Most important, their gains are capped and their potential losses are infinite. This is the reverse of the risk profile of long investors, who buy and hold shares. If you buy a stock for $20 and it falls to zero, you can’t lose more than $20; but your potential gains are unlimited if the stock keeps rising.
This is the phenomenon behind the GameStop action. It’s known as a short squeeze. The stock bulls higher, eventually surpassing the capacity of the shorts to remain short. They bail out by covering — that is, buying — at a higher price, swallowing their losses. Their buying action pushes the stock even higher, forcing more shorts to cover, until finally all the short sellers are swept out.The promoters of GameStop shares say they have a good bullish case.
Should you jump into GameStop? Far be it from me to issue investment advice. But price spikes can hit you where it hurts. If you bought along with Ryan Cohen in mid-2020, you’ve done great. If you were one of the buyers who pegged the shares at $159 on Monday, you were crushed when they closed that day at $76.79.A short squeeze that can take a stock into the stratosphere can last longer than anyone expects, but they’re not usually based on long-term expectations.
Yeah, real stupid alright... the fat cat are the stupid one.
I hope this wasn't an attempt to make me feel bad for a speculator. Never have, never will.
Some kid with a big mouth is going land a whole lot of people in trouble for this one
Predictions point to year end loss in Game Stop.
Nothing stupid about it unless you think you are buying long on the stock. These guys are only in it for the quick buck, not to actually keep their positions and keep the company alive.
Yeah, it's only going to $10,000. This author is dumb as a box of rocks. You should learn what happened in 2008 with VW and that was nowhere near the shorts on GME. BUY BUY BUY ToTheMoon
I’m sorry, you’ll need to rephrase your opinion as a meme.
I’m not stupid, you’re stupid. So mean !
Don’t short! Keep it going. I’m loving this and I’m sure you are too
horrible
I like the stock
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