You should know better,” McCullough admonishes. Conditions for Infinite Gamma Squeeze & Infinite Short Squeeze. ... A big worry is that this has become a short-squeeze revolt. If after the MM dump, retails continue to buy GME shares up to the $60 price, MM will be caught in a exponentially worse gamma squeeze, which should GME go pass 60C (gamma bump) on the week of January 25, it would turn into the one of biggest tail risk event for the MM/Citidal. It would do everyone well to read this post from our r/options brethren.. Read the comments as well and be prepared to be humbled by some big brain shit. Yea I literally just posted that WSB broke the market. A “gamma squeeze” can occur when a trader or group of traders purchase call options in bulk, causing market makers who sold them these options to buy the stock as a hedge. That forced dealers to buy the underlying equities to hedge their own exposure, pouring fuel on the rally in stocks loved by the Reddit crowd and hated by Wall Street. What is the GameStop short squeeze? As it appears a ‘gamma squeeze’ was manufactured ... Reddit-fueled traders cheered each other on to buy more shares into the market close after news of Bell’s planned departure. What happened last week with GME stock price and option was a combination of a gamma squeeze [1] and infinite short squeeze [2]. ... is the main driver behind a Gamma Squeeze. The combination of a short squeeze and a gamma squeeze helped launch GameStop from a mere $18 … The stock had been focus of a House hearing on retail trading. That's the gamma squeeze that everyone has been talking about, where MM's couldn't cover fast enough. It effectively turns MM into a hedge fund. Hundreds of thousands of are buying the GME 60C because of the infinite short squeeze. Gamma Squeeze? This time, the traders are looking to use the options market to initiate a gamma squeeze … A group of traders on Reddit's WallStreetBets forum is targeting GameStop stock once again. Fun fact, did you know Elon Musk has a line of … I know it's probably to late since this was posted but I cannot help all the actual retards in the comments and messaging me. Good luck. Should millions of retail all choose a common higher call strike price to buy (higher than 60C), the gamma squeeze will be triggered when that prices is hit. The process happens in three general steps: the first part begins when the big investor buys short dated call options very quickly (options of stocks they already own). How some people have made a lot of money; How other people may lose a lot of money? January 29, 2021 60C call option are the highest one on the option change for that date. Market makers and shorts both have to bid against each other to buy shares on the open market, causing the price to skyrocket even higher! Edit 2. The gamma squeeze involves the somewhat complicated world of options. Calls, a form of option, increase in value when the price of the underlying stock increases. ... which is why this phenomenon is known as a gamma squeeze. What is a delta or gamma squeeze in options on stocks? This has never happened in financial history. This phenomenon is known as a gamma squeeze and the feedback loop resembles a regular short squeeze. It would do everyone well to read this post from our r/options brethren. Have you tried turning it off and back on again? Should it go to 75, gamma and infinite short squeeze continues. As a result, gamma is what the delta will be on the second $1 move. Hello this is Steve from customer service. Deja Vu All Over Again: Gamestop Soars Over 165% As 'Gamma Squeeze' Re-Appears By Tyler Durden of Zero Hedge Wednesday, February 24, 2021 4:30 PM EST ... Reddit-fueled traders cheered each other on to buy more shares into the market close after news of Bell’s planned departure. Edit1: Apparently there may be higher call prices for the January 29 2021 option chains. If they try to hit us below 60 and we (the market) buy ourselves back above it and stay, bears are fucked and potential for take off next week, Of course we’re staying. However, after the MM dump shares in an attempt to stop the infinite gamma squeeze they will be net short GME shares and unhedged/not market neutral. Buying GME calls is probably not for first timers. This is great, but we need to employ all of the resources available to us. You did? Or; Retails don't all buy the same call options. The site may not work properly if you don't, If you do not update your browser, we suggest you visit, Press J to jump to the feed. The rest is history, GME closed at $65, and every single call that expired yesterday was ITM. SEC may allow them to get away from this momentarily. What is a short squeeze? Hundred of thousands of retail are buying the GME 60C across the options calendar and MM can't hedge properly because there are not enough GME shares to buy to properly financially hedge (accounting for the interest rate to borrow). I’ve been hard for over a week straight now and my doctor can fuck right off. I am here to tell you that you broke the market.Have I answered to your question in a satisfying and timely manner ? MM doing so, forces brokers to margin call the shorts caught in their infinite short squeeze. The term gamma squeeze gets thrown around a lot, but I don't think everyone really understands the underlying mechanics. Both conditions are pro-cyclical and feed on each other in an infinite feedback loop so long as more an more retails buy the GME 60C. Edit2: For gamma squeeze, you look at the open interest (OI) and strike price. The highest option this morning was the $35 strike price which was selling for 0.72 and reached a high of $10.99 before the closing bell. That's fucking retarded. Reddit . This is not sound financial practice nor is any of this post actual advice. However you look at it, this is not a good look for a lot of people. Sorry if this is in the wrong flair and such, I’m new to actually using Reddit and actually making posts and new to stocks in general. 3 times on Friday? What is short interest as percent of float? The term gamma squeeze gets thrown around a lot, but I don't think everyone really understands the underlying mechanics. You know what that is. On top of the “gamma squeeze” that was used with Hertz, another tactic, a “short squeeze”, was spotted – highlighting the fact that a few hedge … They had to shut down the Bombay stock market for 3 days to figure it all out and the CEO Ambani ended up a stock legend. The MM’s have to be furious they were put into this position by the ridiculous short selling by Melvin. On top of this selling pressure, similar to the gamma squeeze we saw on the way up with MMs buying shares as prices increase to cover the calls they wrote, they will be selling shares as prices drop to cover/hedge puts they wrote which are now ITM. This time, the traders are looking to use the options market to initiate a gamma squeeze … tldr; There is a gap in the market structure so that if millions of retails buy Januray 29 GME 60C on January 25 2021, there is a high probability of both an infinite gamma and short squeeze. And should millions of retail buy the January 29 GME60C 2021, the losses for MM but profits for retail will be massive. Jeffamazon highlighted this in a post on r/wallstreetbets four months ago that serves as an excellent play-by-play guide to how the GameStop gamma squeeze eventually turned Wall … Tomorrow we should have options as high as $60, given the volatility in the price, is likely that market makers will price the new options way higher making it more difficult to play the gamma squeeze. The stock has been rangebound for months and our proprietary indicators identified the setup for a gamma squeeze / stock breakout. https://www.reddit.com/r/options/comments/l9rdrt/lets_clear_up_a_few_misconceptions_about_gamma/, Those mofo’s - oh it makes perfect sense now, it’s so easy...fml where banana Edit - being this retarded sucks . A gamma squeeze can go up or down, and the mechanics are similar either way. There has been some cross-sub action between r/GME and r/WallStreetBets. This is mostly a gamma squeeze. There is a chance that MM can dump the shares they bought to hedged the gamma steepening and call buying [1]. SoftBank's “Gamma Whale,” which has now been replaced by Reddit-Raiders, provides a lesson on how a gamma squeeze operates. Market makers and shorts both have to bid against each other to buy shares on the open market, causing the price to skyrocket even higher! As you may now realize --(MM and brokers) hope you don't -- there is a gap in the market structure that leaves them (MM/Citadel) vulnerable to massive losses. Retails could see 100000% return on their weekly GME Januray 29 call options at the highest strike price. Read the comments as well and be prepared to be humbled by some big brain shit. If you want to be extra retarded, Sell ITM puts and use the cash to buy OTM calls. A short gamma position gets longer delta as spot drops and shorter delta as spot rises. Infinite Gamma Squeeze Should million of retails buy the Januray 29, 2021 60C weekly on Monday, this will create an infinite gamma squeeze because MM still can't properly hedge, and are forced to buy shares at whatever price to hedge. “Reliance” was a company that was gamma squeezed to the tune of absurd amounts of money. That forced dealers to buy the underlying equities to hedge their own exposure, pouring fuel on the rally in stocks loved by the Reddit crowd and … , More posts from the wallstreetbets community, Press J to jump to the feed. Gamma … Note: A primer on gamma squeeze: https://www.reddit.com/r/wallstreetbets/comments/l2t9bf/gme_i_think_this_is_a_gamma_squeeze_where_dealers/ Market Maker [1] are in a condition never observed in financial history. Press question mark to learn the rest of the keyboard shortcuts, https://www.reddit.com/r/wallstreetbets/comments/l2t9bf/gme_i_think_this_is_a_gamma_squeeze_where_dealers/, https://ca.finance.yahoo.com/quote/GME/options?p=GME. A $10 billion company, thanks to a gamma squeeze, delta hedging and Reddit. We all have our own attributes bro, I don't entirely understand either. It comes down to a lot of calculus and mathematical theorems. Print Email. So what does a gamma squeeze do to a stock? What is short interest ratio? Infinite Gamma Squeeze Should million of retails buy the Januray 29, 2021 60C weekly on Monday, this will create an infinite gamma squeeze because MM still can't properly hedge, and are forced to buy shares at whatever price to hedge. Gamma squeezes can be particularly potent when … Now, some options experts say the message-board masses could exploit this so-called gamma squeeze in … They will force margin call on them so they pony up on a short squeeze instead of them eating gamma squeeze over and over. A group of traders on Reddit’s WallStreetBets forum is targeting GameStop stock once again. Nice, saved this before I put my toddler to bed, good call for sure bro, I missed that post! This should propel AMC stock price this week, hopefully forcing an insane gamma squeeze. However, the gamma squeeze and high short interest has an amplifying effect on each other. “Gamma Squeeze? This alleviates the infinite gamma squeeze. A “gamma squeeze” is a trading terminology that refers to massive call buying leading to higher stock prices, which leads to more call buying, a higher stock price and so on. The austists did it. GME at 60 is the Maginot line next week. What the MM are hoping for are twofolds: They scare retails to sell below $60. Should it fall below it, MM have won a strategic victory. Pinterest Gmail. First, note the existing options positions in GME, from the day prior to yesterdays squeeze (Tuesday, 2/23). And it's still broken? If you're a faggoty european, please don't ask how to trade options in your country, just buy shares. Delta quantifies the rate of change of the options … Somebody is selling you the options that you are buying. GME Gamma Squeeze – What Happened? I have no idea … But given that retail loves high risk, I hypothesize they will all choose the furthest OTM call options. A “gamma squeeze” is a buying and selling terminology that refers to huge name shopping for resulting in larger inventory costs, which results in extra name shopping for, a better inventory worth and so forth. For the first time in financial history all GME call options are in the money (ITM) because the highest call strike price set by the CBOE for Januaray 29, 2021 is $60. 58 mins What does a gamma squeeze do to a stock? TLDR: On 2/25 big boys bought a crap ton, millions of dollars worth, of AMC 6.5 and 7 weekly calls in literally 17 minutes via split orders, and these calls were likely to be exercised. RKT Gamma Squeeze We noted in a video last night that RKT was setup for a gamma squeeze, and the stock is up ~20% this morning. ... help Reddit App Reddit coins Reddit premium Reddit gifts. If not in legal action, then in some very very heated conference calls. With the introduction of options, specifically weekly call options, a short squeeze can be taken to another level called a gamma squeeze. Press question mark to learn the rest of the keyboard shortcuts. MM doing so, forces brokers to margin call the shorts caught in their infinite short squeeze. They will bankrupt Melvin before they pay out of their own pockets. A gamma squeeze happens when a big investor uses many options to ramp up the prices of select stocks due to option sellers needing to hedge their trades. Gamestop ($GME) Stock: Get Ready for The Biggest Short Squeeze of Our Lifetime, Looks like you're using new Reddit on an old browser. Let’s get this straight, what we are seeing today is not 100% a short squeeze. Good read on that thread that was linked including the comments with counter points. Twitter Reddit. The stock is trading at $30, and you decide to buy $50 calls that expire in a month. Today we already ran out of options calls. Much of the recent activity has been attributed to WallStreetBets, a growing community of retail traders on Reddit. Before explaining the scheme, we define option Delta and Gamma. Related to the short squeeze is something known as a gamma squeeze. "That gamma effect adds buyer after buyer in the stock, with no one able to short the stock because it is hard to borrow. However, doing so does not make them market neutral. Should the share price get close to the price with a highest open interest, that's when the gamma steepening occurs as probability goes to 1. Quit Crying (An Epic Rant From Keith McCullough) In today’s clip from The Macro Show, Hedgeye CEO Keith McCullough tears into the hedge fund managers complaining about Reddit users. However, the gamma squeeze and high short interest has an amplifying effect on each other. MMs might be sympathetic to Melvin’s plight, but in no way shape or form will they allow themselves to be the bag holders. Example: Should millions of retail buy the January 29 70C or January 29 75C, and the infinite short squeeze continues. The amount of media attention given to these tickers, along with the Reddit page “Wallstbets” is unprecedented, with an enormous amount of new, retail traders, trying to jump in on, what seems to be, the answer to all of their financial prayers. GME will be $20 or less eventually but it could easily go to $1,000 before that. How did Reddit group Wall Street Bets execute a short squeeze? I wouldn't be surprised if Melvin and the other naked shorters are brought on the carpet for this fiasco. I even bought the dip at 58 after it touched 76, Edit: TLDR: Buy equal value in GME shares plus 75c for 1/29 to get tendies. Yesterday GME saw another massive price move with the stock ripping over 100% from $45 up over $160 in after hours trading. I’m not trying to meme around or anything but trying to figure what happe… Stocks For someone that is short calls in a stock, the incremental risk increases as the share price of the underlying rises. [1] https://www.reddit.com/r/wallstreetbets/comments/l2t9bf/gme_i_think_this_is_a_gamma_squeeze_where_dealers/ [2] /r/stocks/comments/l21gpz/infinite_short_squeeze_explained_blue_appron_case/ [3] https://ca.finance.yahoo.com/quote/GME/options?p=GME. Let's say that you are bullish on Gamestop. The effect is a massive short squeeze." If you do not know what 1/29 75c means, just buy shares. This is mostly a gamma squeeze. If the GME 70C or 75C is hit, GME share price enters a gamma squeeze. When I say "short gamma" you can think of that as "net short options, with an emphasis on near-dated, held by dealers." MM have to buy shares to remain neutral as the options are now ITM. This move was likely fueled by an options gamma squeeze as we’ll explain here. The gamma squeeze begins as a flurry of call option buyers come in a buy a significant amount of option contracts at market. Fundamentally, this analysis is still correct.
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