Daybull
4年前
MUST READ: This is not my material. This is from Reddit:
Also options contracts expiring next Friday represent nearly half of the entire available float, and 90% of the volume of those contracts is unhedged, meaning this thing is a powder keg waiting to blow.
There are 83.72m shares in the float. That's small. In fact, something like 94% of the company is owned by the CEO, with those 83.72m representing the other 6%. Insiders own 12.85% of that float and institutions own 24.50%, which together is 37.35%. For those of you who never graduated from elementary school, that's 31.27m shares, which makes the free float 51.45 million shares.
Of that, 11.88m shares are short (as of 04/29) which is 23% of the free float. That's important, but not in and of itself enough to squeeze. (Addendum: It is certainly higher now than it was on 04/29, because as of TODAY there are zero shares available to short).
Options volume for 05/21 is huge - between the $7.5 and $15 strikes, there are approx. 205,500 calls, all out of the money. Their average delta is about 10% (according to Schwab), meaning that as they become ITM, 18.5m shares will be automatically bought by brokers to cover those calls. This is a gamma ramp - it will happen linearly if the stock ticks upwards, creating a positive feedback loop of rising price until they are entirely hedged. At the same time, shorts must cover if the price rises (or must they?). That means that IF the price rises significantly, nearly 30 million shares must be bought in the next 7 days to cover - that's 57% of all the shares available!
Holy Moly.
Also on Wednesday the stock experienced an extremely sudden 10% surge (when everything else was in a multi-day freefall) and it hasn't gone back down.
trendzone
4年前
Twitter brokers calling in short positions in fear that the reddit trading crowd are going to run this stock up like what's going on in Gm,. E going nuts over three hundred bucks, and all the other ones also going nuts, Rk, T also running up big, there is no place for shortbags but the highway of pain.