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Wall Street vs The Internet.
Is the $GME over or is this a billion dollar shift in power?
Time for a thread
Is the $GME over or is this a billion dollar shift in power?
Time for a thread
1/ RETAIL RENAISSANCE
âPrior to 2020, retail activity stayed flat for 20 yrs. Now households, active/passive mutual funds & ETFs represent 63% of the market ($36 Trillion). Hedge Funds own 3% of the $57T US equity market - so "Retail" is 12x more important than hedge funds.â
âPrior to 2020, retail activity stayed flat for 20 yrs. Now households, active/passive mutual funds & ETFs represent 63% of the market ($36 Trillion). Hedge Funds own 3% of the $57T US equity market - so "Retail" is 12x more important than hedge funds.â
2/ RETAIL RENAISSANCE
Thereâs a new important investor at the table and Wall Street will have to adjust.
*Now 8.4MM followers under management
Thereâs a new important investor at the table and Wall Street will have to adjust.
*Now 8.4MM followers under management
3/ RETAIL RENAISSANCE
Letâs dive into âThe Rise of the Retail Investorâ in <2 mins:
- DEFINING MOMENT
- COMMUNITIES
- PLATFORMS
- LEADERS
Letâs dive into âThe Rise of the Retail Investorâ in <2 mins:
- DEFINING MOMENT
- COMMUNITIES
- PLATFORMS
- LEADERS
4/ DEFINING MOMENT 
Crowd-Sourced Squeeze
This story is easily told through:
- A Dog
- Two Wolves
- Pack of Lions
Crowd-Sourced SqueezeThis story is easily told through:
- A Dog
- Two Wolves
- Pack of Lions
5/ DEFINING MOMENT
Dog: Video $GME retailer with an underwhelming track record.
Two Wolves: Hedge fund Melvin Capital & short-seller Citron Research. Believed $GME âbrick & mortarâ stores were a liability in an increasingly digital world & they could profit by SHORTING
Dog: Video $GME retailer with an underwhelming track record.
Two Wolves: Hedge fund Melvin Capital & short-seller Citron Research. Believed $GME âbrick & mortarâ stores were a liability in an increasingly digital world & they could profit by SHORTING
6/ DEFINING MOMENT
Pack of Lions: +8 Million retail investors on Reddit group r/Wallstreetbets. Plus influencers like @elonmusk , @chamath, @tyler and even politicians like @AOC â who âpiled-onâ the trade and/or Tweeted about it.
Pack of Lions: +8 Million retail investors on Reddit group r/Wallstreetbets. Plus influencers like @elonmusk , @chamath, @tyler and even politicians like @AOC â who âpiled-onâ the trade and/or Tweeted about it.
7/ DEFINING MOMENT
In nutshell this is what happened
In nutshell this is what happened
8/ DEFINING MOMENT
âAll the math you need in the stock market you get in the fourth grade.â â Peter Lynch
$GME had a HUGE short interest of 140%. Retail investors saw this and believed they could make a profit by taking the other side of the bet.
âAll the math you need in the stock market you get in the fourth grade.â â Peter Lynch
$GME had a HUGE short interest of 140%. Retail investors saw this and believed they could make a profit by taking the other side of the bet.
9/ DEFINING MOMENT
Further encouraged by activist investor Ryan Cohen buying +$76MM of stock looking to turn the company around like he did with http://Chewy.com sold to PetSmart for $3.5B.
Further encouraged by activist investor Ryan Cohen buying +$76MM of stock looking to turn the company around like he did with http://Chewy.com sold to PetSmart for $3.5B.
10/ DEFINING MOMENT
Retail started buying stock & tons of âout-of-the-moneyâ call options, driving the stock price way up!
They also ordered dozens of pizzas to some of the short sellersâ homes, LMFAO!
Retail started buying stock & tons of âout-of-the-moneyâ call options, driving the stock price way up!
They also ordered dozens of pizzas to some of the short sellersâ homes, LMFAO!
11/ DEFINING MOMENT
Next, a Black Swan event happened, not accounted in anyoneâs ârisk models.â
TWO simultaneous SQUEEZES:
1) Short Squeeze: related to offside short positions
2) Gamma Squeeze: related to offside option positions
Next, a Black Swan event happened, not accounted in anyoneâs ârisk models.â
TWO simultaneous SQUEEZES:
1) Short Squeeze: related to offside short positions
2) Gamma Squeeze: related to offside option positions
12/ DEFINING MOMENT
Without going into CFA mode, trust me this led to a perfect parabolic âbuying stormâ sending the stock from $40 to +$480 last week. Closing at $325 on Friday.
Now, back down below $100
Without going into CFA mode, trust me this led to a perfect parabolic âbuying stormâ sending the stock from $40 to +$480 last week. Closing at $325 on Friday.
Now, back down below $100
13/ DEFINING MOMENT
Next:
- Hedge Fund Gets $2.7B Bailout
- Reddit Group Gets Mysteriously Taking Offline (now back online)
- Trading on $GME & other stocks & options halted (for retail only)
Only 2 platforms (I can confirm) didnât halt trading are @Fidelity & @Wealthsimple
Next:
- Hedge Fund Gets $2.7B Bailout
- Reddit Group Gets Mysteriously Taking Offline (now back online)
- Trading on $GME & other stocks & options halted (for retail only)
Only 2 platforms (I can confirm) didnât halt trading are @Fidelity & @Wealthsimple
14/ DEFINING MOMENT
- Hedge Funds Announce Covering Their Shorts
- Robinhood Raises Billions & Gets Sued By Its Own Customer, delays IPO
And this...
- Hedge Funds Announce Covering Their Shorts
- Robinhood Raises Billions & Gets Sued By Its Own Customer, delays IPO
And this...
15/ DEFINING MOMENT
âIt was a smart trade. Retail saw it and Wall Street missed it.â @chamath
The reason âretail saw itâ is because they are incredibly powerful in numbers, tools & community. They are now armed with much of the same information as professional investors.
âIt was a smart trade. Retail saw it and Wall Street missed it.â @chamath
The reason âretail saw itâ is because they are incredibly powerful in numbers, tools & community. They are now armed with much of the same information as professional investors.
16/ COMMUNITIES
âHedge fund âIdea Dinnerâ with +8 million guestsâ
For decades, Wall Street has been hosting fancy âideas dinnersâ behind closed doors where they discuss investment strategies.
Retail investors created their own version: Reddit, Discord, Twitter & TikTok
âHedge fund âIdea Dinnerâ with +8 million guestsâ
For decades, Wall Street has been hosting fancy âideas dinnersâ behind closed doors where they discuss investment strategies.
Retail investors created their own version: Reddit, Discord, Twitter & TikTok
17/ COMMUNITIES
It would be easy to dismiss them as unsophisticated.
But itâs simply NOT true.
For example, one of the influencers from r/WallStreeBets âDeepFâingValueâ has CFA and was a financial advisor.
It would be easy to dismiss them as unsophisticated.
But itâs simply NOT true.
For example, one of the influencers from r/WallStreeBets âDeepFâingValueâ has CFA and was a financial advisor.
18/ COMMUNITIES
My fund manager friends tell me their firms âscrape the group for trading ideas.â
I have also personally seen investment banks email research from WallStreetBets Reddit group to get their own institutional clients to trade the ideas.
My fund manager friends tell me their firms âscrape the group for trading ideas.â
I have also personally seen investment banks email research from WallStreetBets Reddit group to get their own institutional clients to trade the ideas.
19/ COMMUNITIES
Also, I am seeing lots of finance groups proliferating on the wildly NEW popular audio-only app @joinClubhouse.
Launched during the pandemic, it now boast +2MM users and a $1B valuation.
Also, I am seeing lots of finance groups proliferating on the wildly NEW popular audio-only app @joinClubhouse.
Launched during the pandemic, it now boast +2MM users and a $1B valuation.
20/ PLATFORMS
'Do-It-Yourself' (DIY) investor is on the rise.
Retail, high networth, corporate executives, small business owners and even ex-Wall Street bankers have billions in DIY accounts.
'Do-It-Yourself' (DIY) investor is on the rise.
Retail, high networth, corporate executives, small business owners and even ex-Wall Street bankers have billions in DIY accounts.
21 / PLATFORMS
"Robinhood and the other zero commission brokers that everyone used didn't have enough capital to fund the fight" @mcuban
Some have capital and some have confetti.
Now, we need trading platforms that have both ; )
"Robinhood and the other zero commission brokers that everyone used didn't have enough capital to fund the fight" @mcuban
Some have capital and some have confetti.
Now, we need trading platforms that have both ; )
22/ LEADERS
There are BIG influencers who move markets with Tweets:
@APOMPLIANO BITCOIN
@CHAMATH SPACS
@RAYDALIO CASH IS TRASH
@STOOLPRESIDENTE STONKS
@ELONMUSK ANYTHING #Signal, $Etsy, $DOGE. This week he even changed his bio to #Bitcoin 
, sending it +15%
There are BIG influencers who move markets with Tweets:
@APOMPLIANO
BITCOIN@CHAMATH
SPACS@RAYDALIO
CASH IS TRASH@STOOLPRESIDENTE
STONKS@ELONMUSK
ANYTHING #Signal, $Etsy, $DOGE. This week he even changed his bio to #Bitcoin , sending it +15%
23/ LEADERS
Also, there are thousands if not MILLIONS of small micro influencers with engaged communities like Sara Well, a nurse by day who talks stocks by night in her discord group with dozens of investors.
Also, there are thousands if not MILLIONS of small micro influencers with engaged communities like Sara Well, a nurse by day who talks stocks by night in her discord group with dozens of investors.
24/LEADERS
BUT the community FAVOURITES are the âMEME-AS-A-SERVICEâ army:
@wallstmemes
@parikpatelcfa
@Litquidity
@leveredlloyd
@trustfundterry
and many more!
BUT the community FAVOURITES are the âMEME-AS-A-SERVICEâ army:
@wallstmemes
@parikpatelcfa
@Litquidity
@leveredlloyd
@trustfundterry
and many more!
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