WallStreetBets GameStop Short Squeeze
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Overview
WallStreetBets GameStop Short Squeeze refers to the massive surge in the price of GameStop shares in the stock market in January 2021, when it rose from $17 to over $500, in a significant degree due to a campaign by users in the /r/WallStreetBets subreddit. The hype resulted in GameStop (GME) becoming of the most traded stocks on Wall Street that month, with a massive number of retail investors buying the stock in an attempt to force hedge funds betting against it into large losses.
As GameStop stock garnered attention globally and became one of the most-discussed topics online in late January 2021, the events were followed by a several movie announcements and a number of controversies, including restrictions on trading the stock imposed by several brokerages, and stock market as a whole being put under government scrutiny.
Background
On August 16th, 2019, hedge fund manager Michael Burry, known for shorting the 2008 real estate bubble, reported purchasing 3 million shares, or 3.3% of GameStop,[35] citing the short[27] interest of 63% in the company possibly resulting into a short squeeze[13] as one of the factors affecting the decision to invest. In the following weeks, several news outlets[36][37] reported on Burry's investment.
In September 2019, /r/WallStreetBets user DeepFuckingValue, aka Roaring Kitty, started making monthly posts[8][9] of their January 15th, 2021, $8 call options[10] in /r/WallStreetBets subreddit, mentioning Burry in one of their earliest posts.[8]
On October 8th, 2020, the price of GME stock rose[17] from $9.36 to $13.49, which caused /r/WallStreetBets users to take increased interest in the stock. On that day, Redditor[11] namsilat made a "due diligence" (DD) post in which he advised buying on January 15th, 2021, call options for GME with a $9 strike price (shown below, left). On the same day, DeepFuckingValue[12] posted his potential earnings from his GME calls, at that time valued at over 2.2 million dollars (shown below, right).
Developments
In November and December 2020, following the October 8th surge, multiple /r/WallStreetBets users made posts hyping up GameStop stock, including due diligence posts predicting a possible short squeeze,[27][13] leading to those /r/WSB users who bought in the stock referring to themselves as GME Gang.[14]
The number of posts about GameStop stock in /r/WallStreetBets increased in December 2020,[15][16] with some users betting on an upcoming short squeeze in the stock (posts shown below), with hedge fund Melvin Capital, a major holder of GME short positions,[27] being collectively chosen by the subreddit as an antagonistic figure.
First Short Squeeze / Gamma Squeeze Leg (January 11th – January 21st)
On January 11th, 2021, Chewy founder Ryan Cohen joined the GameStop board of directors.[1] This, along with hype about recently-released video game consoles like the PlayStation 5 and Xbox Series X sparked renewed interest in GameStop among investors, which had bottomed out at $3 a share in 2020 as many people thought the store would soon go bankrupt.[2] The event served as a trigger for the initial leg of the short / gamma squeeze[28] in the stock, with GME share price increasing[17] from $19.95 on January 12th to $31.40 on January 13th to $39.91 on January 14th. During that period, multiple /r/WallStreetBets users made posts in which they prompted others to buy GameStop stock and options. On January 13th and 14th, DeepFuckingValue posted[18][19] screenshots of their potential call earnings from their GME calls, with the January 13th post (shown below, left) gaining over 41,900 upvotes in ten days. On January 17th, Redditor[20] TitusSupremus made a DD post hyping up further buying pressure in the stock that gained over 12,900 upvotes (shown below, right).
On January 19th, 2021, Vice[21] reported on the short squeeze.
/r/WallStreetBets vs. Citron Research
Prior to January 2021 events, /r/WallStreetBets built antagonistic relationship towards Citron Research in 2020 as the majority of /r/WSB users disagreed with Citron's bearish prognosis towards several stocks popular in the subreddit.
On January 19th, 2021, Andrew Left of investment newsletter Citron Research posted that he thought those investing in the company at the current level were "suckers,"[3] announcing a live stream about the situation on January 20th. On the same day, Redditor[22] SmollPpMaster69 posted the screenshot of the tweet to /r/WallStreetBets, writing "Shitron Attacking begins." and gaining over 23,000 upvotes in two days. Also on the same day, Redditor[23] spike142 made a post "Citron's Biggest Mistake: They Announced that they would have a live stream, and provided the time and date."
On the following day, Andrew Left's stream was raided by /r/WallStreetBets users, with the stream experiencing technical difficulties.[24] Multiple memes based on the stream and generally about Citron Research were posted in /r/WallStreetBets[25][26] in the following days.
Second Short Squeeze Leg (January 22nd – January 29th)
On January 22nd, 2021, following the increasing buying pressure by /r/WallStreetBets users and other market players, the price of GME stock surged from $43 to $65, peaking at $76.35 during the day.[17]
On that day, multiple /r/WallStreetBets[6][7] users made posts in which they talked about their potential and realized earnings from GameStop shares and options (examples shown below).
On January 25th, 2021, the price of the stock rose to $136.36 within two hours after the premarket opened, with the stock opening at $96 during the main trading session.[17] Within one hour after opening, the price reached $158.
The January 2021 GameStop short squeeze and the role /r/WallStreetBets played in it attracted interest from both mainstream media[2][3][34] and social media,[4][5] with news articles and viral posts about the situation being made.
January 26th and 27th Events
On January 26th, Elon Musk, after the main trading session closing time, tweeted "Gamestonk!!" and linked the WallStreetBets subreddit, with the tweet gaining over 26,200 retweets and 152,400 likes in one day.
During the January 26th postmarket trading session, the price of $GME reached $243.10.
On January 27th, the price of the stock reached $360.40 during the premarket trading session.
On January 27th, 2021, CNBC[29] reported that Melvin Capital, the hedge fund that held a large GameStop short position, closed it for a huge lose, according to a report by the hedge fund's manager. On the same day, Citron Capital’s Andrew Left posted a video[30] in which he revealed that the fund also closed the majority of its GameStop short position at "a loss of 100%."
Following the news, the price of the stock decreased to slightly above $200 as of 8:30am EST.
On Reddit, several viral posts[31][32] speculating that the report by CNBC was false information were made.
In addition to GameStop, several other stocks gained popularity among retail traders and saw high volatility on the market due to the activity on /r/WallStreetBets subreddit, including AMC Theaters (AMC), BlackBerry (BB), Nokia (NOK) and Koss Corp (KOSS).
January 28th and 29th Events
During pre-market hours on January 28th, the price of GameStop stock briefly exceeded $500.[38] Also on that day, /r/WallStreetBets reached 5 million subscribers (from below 2 million at the start of January 2021).
Following the surges in GameStop and other stocks popular among the traders on /r/WallStreetBets, several brokerages including Robinhood, TD Ameridale, Charles Schwab, E*TRADE and WeBull restricted trading $GME, $AMC and several other of the trending stocks (individual lists vary),[33] not allowing the users to buy new stock. Additionally, several brokers increased margin requirements[39] for volatile stocks.
The move received extremely negative responses from both users on /r/WallStreetBets and on social media in general, with brokerage Robinhood, particularly popular among beginner traders and investors, being heavily criticized online. On that day, the US representative Alexandria Ocasio-Cortez tweeted[40] that Robinhood's actions were "unacceptable," with the tweet gaining over 126,300 retweets and 603,000 likes in one day, with other notable politicians and public figures such as Donald Trump Jr., Ted Cruz, Rashida Tlaib and Ben Shapiro also commenting on the situation (tweets shown below).
On /r/WallStreetBets, several viral posts about initiating a class action lawsuit against Robinhood were made, with at least one lawsuit being filed[41] in New York.
Following the restrictions imposed on trading, the price of GameStop stock decreased to a daily low of $120 before again rising to $348 during the postmarket trading session.
That week, the price of GameStop closed at $325 on Friday January 29th.
Week Of February 1st Events
During the week of February 1st, the price of GameStop dropped from a $315 open on Monday to a $64.77 close on Friday.
During the weekend of January 30th and 31st, and during the week of February 1st, multiple /r/wallstreetbets users posted[50][51] photographs of billboards in various American cities advertising GameStop shares and the /r/wallstreetbets subreddit (examples shown below). For example, on January 30th, Redditor[52] SomeGuyInDeutschland posted a video of a Times Square billboard displaying "$GME GO BRRR" message, referencing the Printer Go Brrr meme.
Film and Series Projects
On January 31st, Deadline[53] reported that MGM landed movie rights for 'The Antisocial Network', a yet-to-be written book about the events of the GameStop stock surge by New York Times author Ben Merzrich.
During the week of February 1st, three more movies and a TV series about the events were reported in the works, including movie projects initiated by HBO,[54] Netflix[55] and Console Wars director Jonah Tulis,[56] and a TV series by production company Pinky Promise.[57]
Additionally, Hollywood producer Brett Ratner acquired rights to a film based on the life story of /r/WallStreetBets' founder Jaime "jartek" Rogozinski.[58]
Third Surge (February 24th – ongoing)
On February 24th, 2021, GameStop announced that it's CFO Jim Bell will be resigning from his role effective on March 26th.[57] The official reason for resignation was not disclosed. During the January 2021 stock surge, GameStop failed to capitalize on the increase of its stock price.
On the same day, the price of GameStop stock rose from below $45 during the market opening to over $91 on close.[58] During the pre-market hours on February 25th, the price of the stock reached over $160. The surge was followed by other $BANG stocks favored by /r/WallStreetBets – AMC, Blackberry and Nokia – also climbing by dozens of percent.
The spike in the price of GameStop stock was met with revitalized popularity of GameStop memes in /r/WallStreetBets (example shown below) and new viral discussions of the stock in the subreddit and on other social media.
On February 25th, GameStop opened at $170 and closed slightly above $108. On February 26th, GameStop share price reached $122 during pre-market trading session.
Related Memes
Apes Together Strong
On January 25th, Redditor[42][43] Scheebs_ made a post titled "Short Squeeze Explained for Dummies (us) in /r/WallStreetBets subreddit. In the post, which received over 5,200 upvotes, Scheebs_ used the analogy for a group of apes and snakes trading bananas for the GameStop short squeeze, writing, "if the group of apes stay strong then price will go up" (shown below), with user DragonStoned commenting[44] "Ape together strong," referencing the Apes Together Strong meme. The post and the comment popularized the Apes Together Strong meme among the holders of GameStop shares. The original post later was removed.
We Like the Stock
We Like the Stock and I Like the Stock is a mantra adopted by /r/WallStreetBets users to hype up GameStop and stocks that gained popularity in late January 2021 which they have used to encourage each other and to explain the motivation behind their own purchases.
The meme originated from the January 25th, 2021, episode of CNBC's "Halftime Report" during which Jim Cramer,[47] [48][49] the host of finance television program Mad Money, chanted "We Like the Stock" to comment on /r/WallStreetBet users' motivation behind purchasing GameStop shares.
What is kind of case do they have? We like the stock! We like the stock!
If He's Still In, I'm Still In
If He's Still In, I'm Still In refers to a mantra said by Reddit users in reference to update posts by user DeepFuckingValue who has been keeping his major GameStop positions regardless market fluctuations.
On January 28th, 2021, when the price of GameStop closed at $193.60, dropping from $347.5 close the previous day, DeepFuckingValue[45] posted a screenshot of his April 16th $12 call position which dropped from 47 million USD to 33 million USD in one day, losing nearly 15 million potential gain. In the comment section, Redditor[46] JoeyIsActive replied "IF HE'S STILL IN, I'M STILL IN," with the comment gaining over 43,400 upvotes, and other users making a comment chain repeating the comment (shown below).
The comment was used by /r/WallStreetBets users in subsequent threads by DeepFuckingValue and in other contexts in the following days.
$BANG
$BANG or /r/WallStreetBets ETF refers to a set four stocks popularized in /r/WallStreetBets during the events of the GameStop Short Squeeze. $BANG includes the publicly traded companies BlackBerry, AMC Theaters, Nokia and GameStop.
Search Interest
External References
[1] Forbes – Can Ryan Cohen Work His Chewy Magic At GameStop? Here’s A Possible Game Plan
[2] Fool – GameStop Stock Surges 100% in 2 Days, but It Won't Last
[3] Fool – Short Squeeze Sends GameStop Stock Surging. Again.
[4] Reddit – /r/outoftheloop
[5] Reddit – /r/outoftheloop
[6] Reddit – GME Containment Thread
[7] Reddit – /r/wallstreetbets
[8] Reddit – Hey Burry thanks a lot for jacking up my cost basis
[9] Reddit – GME YOLO update following the Q2 earnings report described as a 'Chernobyl experience'
[10] Call options are financial instruments that earn money if the stock is being traded at a higher price than the strike price on the day of the expiration. The call options usually can be sold before the expiration date is reached.
[11] Removeddit – My final DD.
[12] Reddit – GME YOLO update -- Oct 8 2020
[13] Short squeeze refers to a stock market situation when players are forced to close their short positions due to rapidly increasing price, creating a positive feedback loop and pushing the price even higher.
[14] Reddit – GME Gang Listen UP
[15] Reddit – 💎🙌 GME Gang rise Up! Earnings dip sucked (Fuck you Sherman) but short squeeze gotta squeeze. Continuing the road to multi-millionaire, who’s with me?
[16] Reddit – Why GME could squeeze as early as tomorrow
[17] Investing – GameStop Corp
[18] Reddit – GME YOLO update -- Jan 13 2021
[19] Reddit – GME YOLO update -- Jan 14 2021
[20] Reddit – One DD to rule them. One DD to find them. One DD to to bring them all and in the darkness bind them.
[21] Vice – How Chaotic Redditors Made GameStop Stock Skyrocket
[22] Reddit – Shitron Attacking begins.
[23] Reddit – Citron's Biggest Mistake: They Announced that they would have a live stream, and provided the time and date.
[25] Reddit – Citron video summarized
[26] Reddit – The face of a man days from bankruptcy
[27] Holders of short positions sell shares they don't own, hoping that the price of the stock will go down. They have to purchase shares at a later point to return them, and will lose money if the price of the stock goes up over the period between selling and buying.
[28] Gamma squeeze happens when a large number of call options is being purchased, with sellers of these call options buying the underlying stock in order to hedge their positions, thus driving the price of the stock up.
[29] CNBC – Melvin Capital, hedge fund targeted by Reddit board, closes out of GameStop short position
[30] Twitter – @CitronResearch
[31] Reddit – DONT FALL FOR THE FAKE BS REPORT BY CNBC
[32] Reddit – WARNING: More manipulation on this sub by GME shorts
[33] Marketwatch – GameStop and AMC trading restricted by TD Ameritrade, Schwab, Robinhood others
[34] Memebase – Robinhood Banned The Trading Of Reddits Hottest Stocks But They Can't Stop The Memes
[35] BusinessWire – Scion Asset Management Urges GameStop to Buy Back $238 Million of Stock with Cash on Hand
[36] The Motley Fool – A Famous Investor Bets Big on GameStop -- but Will It Pay Off?
[37] Business Insider – GameStop soars after 'Big Short' investor Michael Burry says it still has big upside
[38] Reddit – ‘GameStop stock hits as high as $500 in premarket action
[41] Courtlistner – Case 1:21-cv-00777
[42] Reddit – Short Squeeze Explained for Dummies
[43] Removeddit – Short Squeeze Explained for Dummies
[44] Reddit – DragonStoned
[45] Reddit – GME YOLO update -- Jan 28 2021
[46] Reddit – JoeyIsActive
[47] YouTube – "We Like the Stock" – Jim Cramer on Gamestop Stock (GME)
[48] Reddit – Does someone mine calling Jimmy and tell him to stop saying 'we like the stock' and tell him that we LOVE this stock. 1 minute 30 seconds in
[49] Reddit – WE LIKE THE STOCK
[50] Reddit – Billboard! Went full retard!🚀🚀 North of Dallas along super busy I-35
[51] Reddit – Billboard scene in Portland
[52] Reddit – Times Square right now
[53] Deadline – MGM Lands Rights To Ben Mezrich’s Book Proposal ‘The Antisocial Network’; Would Chronicle Recent Wall Street-GameStop Chaos
[54] Variety – GameStop Film in Development at HBO
[55] Deadline – Netflix Finalizing GameStop Stock Movie Package; Mark Boal In Talks To Write, Noah Centineo Attached, Scott Galloway To Consult
[56] Deadline – ‘Console Wars’ Director Jonah Tulis Underway On GameStop Documentary With Submarine Set To Produce
[57] Deadline – Pinky Promise Developing Limited Series ‘To The Moon’, The Latest Project To Chronicle The Roller-Coaster Saga Shaking Wall Street
[58] Business Insider – Wall Street Bets founder sells his life story to film production studio owned by Brett Ratner, who was previously accused of sexual misconduct
[57] CNN – GameStop CFO resigns a month after the Reddit trading frenzy
[58] The Verge – GameStop stock just jumped 100 percent, and WallStreetBets is ecstatic
![YOU HAVEN'T COVERED YOUR SHORTS ORTY * fisM EMS+ Cy)EF ANDICAN SHOW П МАTНЕМАTICALLY By the Office of Compliance Inspections and Examinations! Volume III, Issue 2 August 9, 2013 Strengthening Practices for Preventing and Detecting Illegal Options Trading Used to Reset Reg SHO Close-out Obligations Options are priced in the market place so that the price of the underlying security is the same as the "synthetic"19 price of its options. This relationship between the price of a security and its options is known as "Put/Call Parity." consists of a long call and short put of the same strike and expiration date (also known as a “long combination" position), is typically the equivalent of a 100 share long position in an equity security." When the “synthetic" position is priced correctly with respect to the actual shares, no potential profit opportunities exist in the market. In other words, being long the “synthetic" position (e.g., the long combination) and being short the actual shares normally results in a riskless, fully hedged, and profitless position. This position is commonly known in the industry as a “Reversal."2² The following is taken from the SEC's 2003 report on "Strengthening Practices for Preventing and Detecting Illegal Options Trading Used to Reset Reg SHO Close-out Obligations" ?20 For example, a “synthetic" long position, which The Initial Transaction Example: Stock XYZ trading $51.00 • May 50 Puts on XYZ trading $3.00 The shorter who wants to hide their short position will transfer to a synthetic short position. This consists of having CALLS and PUTS at the same strike price, an open short May 50 Calls on XYZ trading $3.00 Trader A: Sells 10,000 shares XYZ @ $51.00 Buys 100 May 50 Calls @ $3.00 Sells 100 May 50 Puts @ $3.00 In this example, the “synthetic" position is trading for $50, which is simply Call Price - Put Price + Strike Price. The actual shares are trading for $51, so that Trader A has effectively sold shares for $1 more than it paid for them, in a simultaneous transaction. Each time the trade is made, Trader A is earning a $100 profit“, assuming that (a) Trader A is not being charged a fee to borrow shares to deliver on the short sale and (b) the clearing firm does not effect a buy-in against the trader to close-out a fail to deliver position.2" In this case, the trade was made 100 times, so that the profit would be $10,000. The sole reason for the disparity between the actual shares and the “synthetic" position is the fact that the shares of XYZ are hard to borrow. position, and then a swap of the original short position to the synthetic short. In the industry this is referred to as a "reversal". The Second Transaction to “Reset the Clock" The shorter does not want to deliver/cover. They want to Assuming that XYZ is a hard to borrow security, and that Trader A, or its broker-dealer, is unable (or unwilling2) to borrow shares to make delivery on the short sale of actual shares, the short sale may result in a fail to deliver position at Trader A's elearing firm. Rather than paying spoof to the clearing house that they covered by converting to the borrowing fee on the shares to make delivery, or unwinding the position by purchasing the shares in the market, Trader A might next enter into a trade that gives the appearance of satisfying the broker-dealer's close-out requirement, but in reality allows Trader A to maintain its short position without ever delivering on the short sale. Most often, this is done through the use of a buy-write trade, but may also be done as a married put and may incorporate the use of a synthetic short position. This allows the shorter to maintain their short position without ever actually delivering the share(s). short term FLEX options.9 These trades are commonly referred to as "reset transactions," in that they have the effect of resetting the time that the broker-dealer must purchase or borrow the stock to close-out a fail. The transactions could be designed solely to give the appearance of delivering the shares, when in reality the trader has no intention of meeting his delivery obligations. The buy-writes may be (but are not always) prearranged trades between market- makers or parties claiming to be market makers. The price in these transactions is determined so that the short seller pays a small price to the other market-maker for the trade, resulting in no economic benefit to the short seller for the reset transaction other than to give the appearance of meeting his delivery obligations. Such transactions were alleged by the Commission to be sham transactions in recent enforcement cases. 3" Such transactions between traders or any market participants have also been found to constitute a violation of a clearing firm's responsibility to close out a failure to deliver. When they perform this trade it is a "reset transaction" because they are resetting the Failure To Deliver (FTD). The only net loss on this trade is that the shorter pays a small premium to the Market-Maker for the reset transaction. 31 Trader A may enter a buy-write transaction, consisting of selling deep-in-the-money calls and buying shares of stock against the call sale. By doing so, Trader A appears to have purchased shares to meet the broker-dealer's close-out obligation for the fail to deliver that resulted from the reverse conversion. In practice, however, the circumstances suggest that Trader A has no intention of delivering shares, and is instead re-establishing or extending a fail position. With the Deep OTM PUT and Deep ITM CALL, the CALL is sold to the Market-Maker, whom sells shares to the shorter. The shorter can then say to the clearing house that they "have the These circumstances vary. For example, Trader A may be engaging in buy-writes with a known counterparty, such as another market maker (Trader B) that Trader A pays to take the other side of its reset transactions. In this circumstance, Trader A and Trader B agree on a price at which the buy-write will be transacted. The trade is consummated as a spread, with the stock and option portions executed at the same time. Trader A sells calls to Trader B, and Trader A buys shares from Trader B. The size of the trade is dictated by how many shares Trader A is required to deliver to appear to have closed out the settlement fail arising from his short position and avoid a buy-in or large borrowing fees. Trader A knows or has reason to know that the counterparty to the buy-write will not deliver securities in settlement of the transaction. Rather, shares to cover with" and thus reset their FTD. This is valid because a bona-fide Market-Maker can sell the shorter shares without first locating them. on the same day of the buy-write, Trader B will, in almost every case, exercise the deep in-the- money options it bought from Trader A in order to eliminate the short position created by selling The Market-Maker then exercises the Deep ITM CALLS to get The two counterparties trade deep in-the-money calls with little to no open interest, so that Trader A knows that when Trader B exercises its calls, Trader A will be the one assigned2 on the exercised calls. As a result of the assignment on the exercised calls, Trader A has another delivery obligation. Trader A, or its broker-dealer, remains unable (or unwilling) to borrow shares to make delivery, and the reset transaction may result in a fail to deliver position at Trader A's clearing firm. The result may be a persistent fail to deliver position in the security at issue. the shares they sold to the shorter returned to them. After this transfer, the Market-Maker is now out of the trade with a little cash from the premiums. To the broker-dealer or clearing firm, it may appear that Trader A’s purchase, in the buy-write, has allowed the broker-dealer to satisfy its close-out requirement. Trader A continues to execute a buy-write reset transaction whenever necessary, and by the time of expiration of its original Reversal, it may have given up some of the profits in the form of premiums paid for the buy- writes, but it has maintained its short position without paying the higher cost to borrow or purchase shares to make delivery on the short sale. In each buy-write transaction, Trader A is aware that the deep in-the-money options are almost certain to be exercised (barring a sudden huge price drop), and it fully expects to be assigned on its short options, thus eliminating its long shares. In the end, the shorter has made it appear as if they obtained shares to cover their original short position. But now they are synthetically short the options. So therefore, we should see a massive PUT OI permanent increase, because the PUTS are left on the record, while the CALLS are traded and exercised immediately. Suspicious Deep ITM CALL activity should also roughly mirror PUT activity. This would indicate that they have most likely performed the buy-write trade of: 1) Creating the synthetic position with Deep ITM CALLS and Deep OTM PUTS. 2) Used the ITM CALLS to swap shares instantaneously to make it "appear" to the Clearing House that they covered their original short position / FTD. 3) Become net short the synthetic position. Suspicious deep ITM call volumes and FTDS in 2021 Strike Bin 250000 - (0, 2] (2, 5] (5, 10] E4 200000 - Approximately 1.1 million CALLS are bought and exercised prior (10, 15] (15, 20] (20, 25] to January 29th (SI Report Date) (25, 30] (30, 40] (40, 60] (60, 80] (80, 110] (110, 150] (150, 190] 150000 - About 400K ITM CALLS are created and exercised in February/March. 100000 - 1 (190, 240] 50000 - Date 1e6 GME Option Open Interest since Jan 2020 2.00 1.75 Call / Put Approximately 1.1 million PUTS created prior to January 29th (SI Report Date) Call Open Int 1.50 Put Open Int hy 1.25 1.00 Bumps in OI coinciding with 0.75 Deep ITM CALL purchases at Feb and March runup 0.50 0.25 2020-07 2020-09 2020-11 2021-01 2021-03 2021-05 2021-07 Charts per /u/broccaaa Date Date Total 247 1/14/2021 502,598 1/15/2021|---> 1/19/2021 1/20/2021 1/21/2021 1/22/2021 1/25/2021 1/26/2021 1/27/2021 1/28/2021 1/29/2021|---> 2/1/2021 2/2/2021 2/3/2021 2/4/2021 2/5/2021 2/8/2021 2/9/2021 2/10/2021 248 585,123 We see an increase of about 1.1m PUT OI between Jan 15 and the next SI 249 249,889 250 331,071 251 364,455 Report Date 252 410,060 253 505,654 254 832,509 2021 Short Interest Reporting Dates 255 1,106,302 256 1,552,657 257 1,674,782 1,546,119 Settlement Date Due Date' Exchange Receipt Date 258 259 1,728,333 260 1,875,353 January 15 (Friday) January 20 - 6 p.m. (Wednesday) January 27 (Wednesday) 261 1,911,051 262 2,045,791 263 1,805,792 264 1,844,186 265 1,871,428 January 29 (Friday) February 2 - 6 p.m. (Tuesday) February 9 (Tuesday) 2/11/2021 2/12/2021 2/16/2021 2/17/2021 2/18/2021 266 1,879,597 267 1,869,435 268 1,598,887 269 1,602,796 270 1,607,826 2/19/2021 2/22/2021 2/23/2021 2/24/2021 2/25/2021 271 1,608,640 1,232,128 1,263,435 272 273 274 1,271,930 275 1,286,860 Another increase of about 248k PUT OI around February 26 2/26/2021|---> 3/1/2021 3/2/2021 3/3/2021 3/4/2021 3/5/2021 3/8/2021 3/9/2021 3/10/2021 276 1,511,611 277 1,364,820 278 1,400,224 279 1,436,690 280 1,451,299 281 1,452,830 282 1,311,110 1,370,785 1,434,321 283 And another increase of about 200k PUT OI around March 12, for a total of ~200k + 248k = 450k PUT OI in February/March 284 3/11/2021 3/12/2021|---> 3/15/2021 3/16/2021 285 1,555,256 286 1,631,429 287 1,482,158 ||D 288 1,531,675 With the PUT OI being spread far and wide upon option dates available during the January runup when these buy-write trades occurred. Ever wonder why PUT OI was so high for July 16th, 2021? It reached approximately 174,000 OTM OI on January 29th. It has since gained more OI most likely due to continued can-kicking of buy-write trades over the past few months. Total PUT OI Upon Expiration (Or Latest Sample) 2/12/2021 2/19/2021 1/29/2021 2/5/2021 3/19/2021 4/16/2021 7/16/2021 1/21/2022 327,000 263,000 244,000 322,000 447,000 427,000 427,000 274,000 To top it off, CALL OI remains the same, despite the 1.1m Deep ITM CALLS traded in January. Showing that these were most likely bought and then immediately exercised. 5 Quote Date 1/14/2021 1/15/2021 1/19/2021 1/20/2021 1/21/2021 1/22/2021 1/25/2021 1/26/2021 1/27/2021 367,271 403,479 247 248 235,891 270,175 297,823 343,682 249 250 251 252 253 264,624 323,864 362,091 254 255 1/28/2021 1/29/2021 2/1/2021 2/2/2021 2/3/2021 2/4/2021 2/5/2021 2/8/2021 2/9/2021 2/10/2021 2/11/2021 2/12/2021 2/16/2021 2/17/2021 2/18/2021 2/19/2021 2/22/2021 2/23/2021 2/24/2021 2/25/2021 2/26/2021 3/1/2021 3/2/2021 3/3/2021 3/4/2021 3/5/2021 3/8/2021 3/9/2021 3/10/2021 3/11/2021 256 290,092 257 282,523 258 204,558 231,549 286,656 312,241 259 260 261 359,982 249,368 262 263 264 287,678 265 316,688 266 346,096 267 366,021 230,206 261,925 268 269 270 289,543 271 337,764 165,606 198,110 204,952 238,087 272 273 274 275 276 275,054 277 129,820 278 132,536 279 134,028 280 135,009 281 135,557 282 136,353 283 137,862 284 140,735 141,138 146,712 285 3/12/2021 3/15/2021 3/16/2021 286 p3 CALL and PUT data per /u/yelyah2 287 148,372 288 4:07 ul LTE A rosenlegal.com 18. This sent GME's stock price rocketing. Retail investors began to take notice of the strategy, and began searching for other, similar opportunities, and the other Affected Securities, many with a high short percentage, began to experience heavy volume as retail investors interest increased. 19. Indeed, of the Affected Securities had an unusually high short interest, or number of shares that that had been sold short but not yet covered or closed out. These securities were primarily shorted by institutional investors. The following chart describes the shorted percentage of float' as of January 15, 2021, for each of the Affected Securities: With all that in mind, the SI% on January 15th was 226.42% Security Shorted Float Percentage (not official numbers yet, alleged per RobinHood lawsuit) AAL 33.75% AMC 38.12% BB 9% ВBY 82.41% GME 226.42% 20. But, on January 28, 2021, Robinhood, and other brokers, restricted trading on the Affected Securities to closing securities only. As a result of this Source: Yahoo! Finance. And the 226.42% SI was suspiciously dropped to ~30.2% following the Deep ITM CALL and OTM PUT trades which very closely mimic the procedure for hiding short positions in synthetics. GAMESTOP (NYSE:GME) SHORT INTEREST HISTORY Change from Previous Report Percentage of Float Shorted Price on Report Report Date Total Shares Sold Short Dollar Volume Sold Short Days to Cover Date 5/28/2021 11,970,000 shares $2.66 billion No Change 20.7% 1 $222.00 5/14/2021 11,970,000 shares $1.97 billion +1.3% 21.0% 0.6 $164.50 4/30/2021 11,820,000 shares $2.08 billion +6.4% 20.8% 0.5 $176.19 4/15/2021 11,110,000 shares $1.85 billion +3.8% 19.9% 0.3 $166.53 3/31/2021 10,700,000 shares $2.08 billion +5.0% 19.6% 0.2 $194.46 3/15/2021 10,190,000 shares $2.70 billion -28.2% 18.7% 0.2 $264.50 2/26/2021 14,200,000 shares $1.54 billion -13.8% 26.1% 0.4 $108.73 2/12/2021 16,470,000 shares $841.62 million -23.1% 30.2% 0.5 $51.10 So therefore with the ~1.1M CALL OI / ~1.1M PUT OI, the synthetic SI% should line up with the drop of 226.42% -> 30.2% =~196.22% With 1.1M OI that equates to 1.1M OI * 100 Shares/OI = 110M Shares worth. And with a float of 57,840,000, that gives us an estimated synthetic position of: 110,000,000 / 57,840,000 = 1.9018 = 190.18% And a grand total of 190.18% + 30.20% = 220.38% SI when accounting for the synthetics. Which is DANGEROUSLY close to the reported 226.42% SI of January 15th Total CALLS OI Opened In January Total CALLS (shares worth) Opened In January SI% On Feb 12 Total SI% (Reduction + Reported) 30.20 Float (January) SI% reduction from CALLS 57,840,000.00 1,100,000.00 110,000,000.00 190.18 220.38 Open Interest Suspicious deep ITM call volumes 2021-01-01 2021-01-05 2021-01-07 2021-01-11 2021-01-13 O 2021-01-15 2021-01-19 2021-01-21 IP|| IH| O SZ-LO- 2021-01-27 2021-01-29 T| ||| || 2021-02-02 2021-02-04 2021-02-08 2021-02-10 2021-02-12 2021-02-16 2021-02-18 2021-02-22 2021-02-24 2021-02-26 2021-03-02 2021-03-04 2021-03-08 2021-03-10 2021-03-12 2021-03-16 2021-03-18 2021-03-22 2021-03-24 2021-03-26 2021-03-30 2021-04-01 2021-04-05 FTDS, % of float](https://i.kym-cdn.com/photos/images/list/002/138/331/bf8.png "\"Well, there it is. More math/evidence pointing to the use of Deep ITM CALLs and Deep OTM PUTs to hide SI in synthetics rather than covering their shorts. This was done through buy-write trades to dodge Reg Sho Close-Out obligations.\"")
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Can of Beans
Jan 24, 2021 at 08:34PM EST
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Jan 27, 2021 at 01:30PM EST