TL;DR on Gamestop stock short squeeze
 

Hedge fund Melvin Capital made a mistake last August by using a public options market to short over three million GameStop (GME) shares. This requires a quarterly disclosure called Form 13F which exposed its' entire playbook. Apparently these markets are not standard procedure for hedge funds, and now I know why.

MC's subsequent filing in the fall showed it had added even more equity to its short of Gamestop. That is when social media Reddit users, led by a handful of disguised (long story) finance professionals, whipped up a rally and pressed anyone and everyone to dump every penny they had into GME stock.

In short order an echo chamber was formed and the squeeze play quickly gained a subterfuge as a noble "war" on Wall Street. All the while, the disguised financial pros on Reddit fanned those flames and encouraged an indefinite no-sell to "teach Wall Street a lesson." Most of them quietly cashed out with tens of millions in profits while encouraging every one else to hold GME to their dying day.

A cursory glance indicates no laws were broken. Some of the financial pros, like Keith Gill, are now being sued by cry-baby options traders who ended up on the losing end. Their goal seems to be exposing those who started the rally rather than winning their weak, sore-loser legal arguments. It will be for the best to know who they were working for and to what extent.

I think some of the winners have bought into our hobby, viewing it as a safe haven. Some may be everyday folks who know have the means to buy the cards they always wanted. Some may be looking to flip or maybe start their own business.

Either way, I think every member of this forum should be on guard for an options market forming around the hobby.