"The short interest staying at a similar range means nobody has closed out their old positions so we can keep squeezing" seems to be a big one.
If you assume that new short positions are being opened - and at the recent prices, that's not an entirely unattractive thing to do - then the short interest staying steady suggests some positions being closed and others being opened, and tells you little about single actors.
And anyone opening short positions at today's prices is basically "resetting the clock" on how long you'd need to squeeze to get them to back down... so if I were to sell it short now, I'd be betting that some folks making some of their first investments ever to ride the hype train are going to be more likely to blink first than I am.
Technically not. Shorts have a borrow fee, and if you trust the wsb guys on this number, the current borrow fee on gme is 80 percent per annum. So if I'm not getting anything wrong here, short sellers do have a bit of a clock.
Does 80 percent per annum mean that carrying the short for ~9 months will cost roughly the same as closing it out today, assuming the price remains constant for the next 9 months?
It means your broker will charge you that carry cost on a pro rata basis, assuming borrow also remains constant. (It's generally not a fixed rate.)
So if you carry a 9mo short with 80% borrow rate on a stock that realizes 0 vol, you played yourself.
If you don't want to deal with borrow, you can buy a put and sell a call on the same strike (usually slightly higher than ATM) which comes with an implied borrow rate that is locked in.
Overlap between which world views? Are you saying between the short sellers’ world views and WSB’s? I have a feeling that a lot of the people on WSB actually work on Wall Street and are just on their phones at work. There seem to be some experienced professional traders there(among many who aren’t), but I don’t see much similarity between them and the shorters in particular.
It’s really creepy how you just compare WSB to a group that half the country considers “supporters of terrorism” or literal terrorists. This is the “magical thinking” to me.
The original GME investment groupthink (Reddit always works this way, it’s lovingly called “the hivemind”) was based on complex, but logically-sound technical reasoning. A lot of due diligence was done. QAnon, as far as I know at least, was based on a post on 4chan with no verifiable evidence whatsoever. WSB’s GME buying was motivated by logic and evidence at its core, and many aspects of this logic have happened exactly as predicted (for example, the multiple gamma squeezes). Unlike QAnon, the more you learn about this, the more it makes sense (though, very obviously, the price is going to crash eventually, and these people know it). Respectfully, I think it’s disingenuous and below-board to try to baselessly compare something you don’t understand well to an alt-right hate group. Show me the solid due diligence and technical analysis that underlies QAnon, and maybe I’ll give your comparison a closer look.
I'm just saying that it's all the same magical thinking. I'm not saying it's the same people, though given the demographics I suspect the overlap is bigger than we think.
Your suspicion, and you’re baseless assumptions about the “demographic” of several million Reddit users, sounds a lot like “magical thinking” without any evidence to offer.
If you assume that new short positions are being opened - and at the recent prices, that's not an entirely unattractive thing to do - then the short interest staying steady suggests some positions being closed and others being opened, and tells you little about single actors.
And anyone opening short positions at today's prices is basically "resetting the clock" on how long you'd need to squeeze to get them to back down... so if I were to sell it short now, I'd be betting that some folks making some of their first investments ever to ride the hype train are going to be more likely to blink first than I am.