Reddit Wrecks Hedge Funds

[katzenjammer]

A cautionary tale from Reddit

For background, I'm 20. The markets have been very exciting lately. Huge gains have been made....but also huge losses. I am in the latter group. I saved money for most of my life, and started investing during 2020 after the pandemic hit. I didn't want to trade, I wanted to just get long term investments and hold them. And that did work out pretty well. I was down red at certain points, but it was never SERIOUS drops, and I was confident that my picks were good in the long run. I wouldn't go into details about the weighting, but my portfolio essentially contained AMZN, MSFT, AAPL, SQ, NKE, ARKK, PLTR, NVDA, WMT, COST, DIS, JNJ, PG, V, and a couple other small picks that were my "fun" stocks - I actually had a few dozen APHA shares at $6. I had heavy tech weighting, but I was confident in the long term prospects.

By this year, just about everything was in the green, and collectively up around 15%. Then came BB. BB looked appealing so I sold most of my stocks that had been moving sideways for a while (AMZN, MSFT, NVDA) and put the money into BB when it was low teens. Within a couple days, it hit the 20s and I sold for thousands in profit. The fact that I made thousands of dollars by doing nothing was crazy to me. The rest of my portfolio was also up several thousand dollars (overall, my profit was around $7000 at this point - a combination of the realized gains from BB and the unrealized gains from everything else).

Then came GME. Several months ago, I neglected GME because I did not think they were a good long term investment, and so I did not buy them when they were less than $20/share. So when I saw the stock jump to 40, and 60 in the span of hours, I thought that was crazy. So what did I do? Naturally, I got FOMO when the stock was almost $400 and bought into the hype because I actually believed in what people over at another subreddit were saying. Within a week, my portfolio dropped around 80% (roughly $20,000). I thought that would be the best learning experience for me, but I bought into the weed hype this week, and have lost another few thousand dollars. All in all, I've lost 90% of my money in the past month. I'm young so I can recover, and this wasn't money I needed urgently. But my money I worked for and saved is completely gone because of my decisions.

I'm writing this mostly for myself because I needed a reality check for myself and don't have anyone to talk to. I can't sleep at nights, and can't really focus on anything else. I've lost all interest in playing video games, and my grades are starting to take a hit. This is really embarrassing for me, and nobody knows I lost my money on stocks (nor do I want them to). I don't know if anyone needs to here this, but please be careful with your money, and don't invest more than you're willing to lose. Especially for young investors, we have such a long time horizon. There's no need to try and get rich quick. Conservative investing will compound over our lives.

[Shoulders?-Stomach!]

I think I had about £100 in savings when I was 18 and about £2,000 (excl student debt) when I was 20. Wonder how much he started with.

I think you have to force yourself to do a stop check every time you buy or sell. Go back to basics, look at the fundamentals, ask yourself am I happy cashing out here or risking x sum on this. Slow it all down.

Given he was already an investor it's amazing he only got in at $400, I mean the whole story was in mainstream news which already indicates it won't have long left to run, and some traders were stopping allowing purchase of that stock before that point which should have flagged up major warning signs to either reduce any planned investment or give it up as a bad job. Again, sorry to hear his story but hopefully he will learn, he will still have more 'savings' than the average 20 year old.

[bgmnts]

I saved money for most of my life had me laughing like fuck.

This is just gambling and like gambling the big problem is surely addiction. Feel sorry for some of these divs.

[QDRPHNC]

It's sad to see anyone wreck their finances like that. At the same time, buying in to a meme stock at the peak, with all your money...

At least he didn't wreck his life. He's 20 and out maybe $5000, he has time to make it back. Sounds like he learned a good lesson though, the same one I learned when I was left holding the bag for an actual, intentional WSB pump and dump scam (ULTA) early last year.

Edit 2: Remembered the saga of u/smartkuz. He made a couple of bear calls in early March and made a ton of money (off both pumping and being right because everything was crashing). Culminated in his ULTA DD where so many tards bought in that the stock dropped 15% that day. They were left holding a -95% bag less than a week later. I guess another hallmark of a successful pump is having a track record. Of course, it's not too hard to fake a Robinhood screenshot for a pumper to artificially boost their own.

ULTA, Z #2, Z #1, CCRN he got banned for the CCRN one

[Ferris]

I think I had about £100 in savings when I was 18 and about £2,000 (excl student debt) when I was 20. Wonder how much he started with.

I think you have to force yourself to do a stop check every time you buy or sell. Go back to basics, look at the fundamentals, ask yourself am I happy cashing out here or risking x sum on this. Slow it all down.

Given he was already an investor it's amazing he only got in at $400, I mean the whole story was in mainstream news which already indicates it won't have long left to run, and some traders were stopping allowing purchase of that stock before that point which should have flagged up major warning signs to either reduce any planned investment or give it up as a bad job. Again, sorry to hear his story but hopefully he will learn, he will still have more 'savings' than the average 20 year old.

No idea what the average 20 year old had but I was getting paid £13k a year to do a full time job I loathed and about £2k overdrawn (plus student loans). I was able to pay bills and rent and my overdraft fees, but if I wanted to eat I had to sell things (records, my guitars, etc) because my paycheque left me literally $0 to buy food. That lasted about 2 years I think, and I was able to dig my way out by living like a pauper and eventually moving in with my then-girlfriend (now Mrs Ferris, happily enough).

The experience of being properly skint was formative, and the only reason I fell into my previous career (and made it so hard for me to resign even though the stress and long hours were literally damaging my health) was because it paid so well. I had basically 0 social life for the first ~3 years as I was working so hard because I never, ever wanted to be that broke ever again. Spending so long in that job is why I'm back at uni now, so in a way I'm still dealing with the blowback of that shitty broke period of my life because I'm now having to recalibrate professionally in my thirties while everyone else is plowing away.

It's one of the reasons I tip so well now and try to be generous with cash with friends etc when I can - I hate to think of anyone going through that because it genuinely scarred me, to the point that a tangential mention of financial loss for a young person has lead to me writing out these 3 quite long and personal (albeit boring and esoteric) paragraphs.

I'm sorry he lost money, but he made the choice and you only gamble what you can afford to lose. Hard cheddar for you, mate - hope you learned your lesson and hey at least you had it to gamble in the first place[nb]and the peak was $480 I think, so if he bought at $400 there was still a point where he was up over 20% and decided not to cash out[/nb]. If I lost my stake in bitcoin today I'd be pissed off but I wouldn't ever put myself in a position where silly stock market gambling could have a material financial impact on me and mine. Ranting fuck it post.

[Ray Travez]

buying in to a meme stock at the peak, with all your money...

Aye, there's the rub. A harsh lesson in risk management. Don't bet all your money on one horse, no matter how great someone tells you it is. Or, especially if someone is telling you how great it is.

[hamfist]

https://www.youtube.com/watch?v=RfEuNHVPc_k&feature=youtu.be

Congress doing a hearing on this now, live. DFV off Reddit is there.

[katzenjammer]

Looks like this is about to get interesting again

https://www.reddit.com/r/wallstreetbets/comments/lnuffj/if_this_isnt_a_sign_from_god_himself/?utm_source=share&utm_medium=ios_app&utm_name=iossmf

https://www.reddit.com/r/wallstreetbets/comments/lnqgz8/gme_yolo_update_feb_19_2021/?utm_source=share&utm_medium=ios_app&utm_name=iossmf

[hamfist]

yes ! I can imagine a bit of a surge on Monday. I've still got the tiny little bit that I bought, no point in selling it as it's well in the red so let's see if it comes back.

[Shoulders?-Stomach!]

Looks like you can buy shares in it again now the risk of ordinary people making money has receded.

[katzenjammer]

yes ! I can imagine a bit of a surge on Monday. I've still got the tiny little bit that I bought, no point in selling it as it's well in the red so let's see if it comes back.

Wouldn't surprise me if it rocketed up just because it's all over the news again

[Noodle Lizard]

I'm way down on GME, so I must be absolutely stupid to be considering trying to average down on Monday after this little bit of news, just because it's almost bound to surge very briefly.

It's astonishing the amount of bagholders on WSB who don't seem to realise that DeepFuckingValue (their spiritual king) has an average cost of about $25 and has already cashed out plenty of the millions he earned.

[hamfist]

Looks like the rocket has refuelled, quite a bit of upward movement today. I still have my sprinkle of GME shares, so I'm watching with interest. Maybe they won't be quite such heavy little bags after all.

[Noodle Lizard]

After holding the bag for the best part of a month, I cut my losses at 55. Quite literally minutes before it soared. Oh suddenly NOW the Ape Army were right all along?

I am fucking cursed with this stock.

[C_Larence]

This was madness. I bought 2 shares of GME yesterday at $46 and right now that is worth $350. A 272% increase. Trading was halted 15 minutes before close, but even after close it's gone up 50%. No idea what's going to happen tomorrow. AMC has also rocketed though not as wildly.

In the time it took to write that post it's gone down to $325, i probably should stop looking

[ZoyzaSorris]

Why has this happened today do we think? And will it continue?

[Noodle Lizard]

Why has this happened today do we think? And will it continue?

No idea, but I am OUT. These stonks are too damn stressful. Or I'm too damn unlucky, anyway.

[peanutbutter]

Pretty concerned about my US stocks as a whole atm, the dollars gone to shit.


This whole thing sets a fucking terrible precedent for casual investors though, holding onto utterly worthless stuff until the value goes to 0 because GME had a random bump a month later.

[Ferris]

This was madness. I bought 2 shares of GME yesterday at $46 and right now that is worth $350. A 272% increase. Trading was halted 15 minutes before close, but even after close it's gone up 50%. No idea what's going to happen tomorrow. AMC has also rocketed though not as wildly.

In the time it took to write that post it's gone down to $325, i probably should stop looking

Where do you see $350? It's ~$91 according to the stock ticker, and that's CAD vs USD.

I saw some nutter put a call option out for for $350 but assumed that was just someone memeing it up.

[peanutbutter]

Where do you see $350? It's ~$91 according to the stock ticker, and that's CAD vs USD.

I saw some nutter put a call option out for for $350 but assumed that was just someone memeing it up.

after hours trading had it at 170 or so, so that'd be 350 there

[C_Larence]

Where do you see $350? It's ~$91 according to the stock ticker, and that's CAD vs USD.

I saw some nutter put a call option out for for $350 but assumed that was just someone memeing it up.

Sorry I meant my 2 shares were worth $350, at $175 each.

[Ferris]

Ahh got it. Thought I'd missed something Huge there (rather than just missing something merely Very Big).

I remain too scared to put any money in GME because the volatility is a bit much for me.

[Noodle Lizard]

Ahh got it. Thought I'd missed something Huge there (rather than just missing something merely Very Big).

I remain too scared to put any money in GME because the volatility is a bit much for me.

The volatility is fun and the gains today would have been great. Unfortunately, I'm always on exactly the wrong side of them. Tried to catch a little wave at 156, but chickened out when it hit the 130s and sold at 140. Chickened out of buying in again at 160. Now at 190, of course.

Inching ever closer to my original buy-in, which I thought was absolutely impossible. Of course I sold it after holding at a 70% loss for the best part of a month, literally minutes before it boomed. I'm both fuming and laughing.

[Nice Relaxing Poo]

A young lad I work with was up £28k on GME at the height. In the end he cashed out just 3k up but at least it wasn't a loss. I just can't understand how he thought the fundamentals were there for a further sustained rise considering he was already about 600% up.

[Enzo]

After holding the bag for the best part of a month, I cut my losses at 55. Quite literally minutes before it soared. Oh suddenly NOW the Ape Army were right all along?

I am fucking cursed with this stock.

I was exactly the same lol

[Noodle Lizard]

On the plus side, everyone's taking their money out of other stocks to pump into GME - so not only did I miss the boom by minutes, all my boring, sensible boomer stocks are suffering as a result. I'm just not going to look for a few days minutes.

[Shoulders?-Stomach!]

Gamestop holding steady at $131 after the further pump recently. What's going on with this at the minute?

[hamfist]

Gamestop holding steady at $131 after the further pump recently. What's going on with this at the minute?

There's this : https://twitter.com/TheHoustonWade/status/1367743123279867909

I've still got mine, and they're now in profit. Still holding on though, see if it goes mad high.

[Shoulders?-Stomach!]

Can't wait for the 33 tweet long explanation about why all that would have happened if only x hadn't intervened/been factored in.

[ZoyzaSorris]

So this is going ape-shit again. Almost made my GME losses back now...