Reddit Inc.'s stock-trading enthusiasts made it a household name by backing companies that Wall Street wouldn’t. For Reddit’s own initial public offering, a group of them are about to flip the script.
In the days after the social-media company filed for an IPO, thousands of members of the WallStreetBets forum — which boasts around 15 million users and helped popularize meme stocks like GameStop Corp. — voted to boost a forum post about shorting the company, a sharp reversal of their typically bullish ways. Their avowed reasons varied from the company’s lack of profitability to competitive concerns, and mostly centered on spite.
(paywalled on Bloomberg website)
I honestly don’t think many in WSB would be willing and or able to be approved for a margin account and to put up the collateral. It’s much easier to buy than to short.
I’m sure some will do it, but I doubt it will be a big thing from retail investors.
Yeah, Reddit was offering shares to high profile users/moderators. The CEO paid himself very near $200 million last year— and the company has never been profitable.
🚩🚩RED FLAGS 🚩🚩🚩🚩
I will stay far away from anything to do with it. (See Robinhood)
Pretty sure it was anyone who reached a certain karma threshold… I’m far from high profile and got multiple emails asking me to invest
I got a bunch of those emails too. Was not high profile, but had some karma.
Any money I put into that company via stock purchases would just line Steve Huffman’s pockets during his exit
scamplan.They offered shares to me as well, and I am anything but high profile…
Lol They want your 💰💴💵
They didn’t offer shares, they offered the ability to purchase shares at institutional purchase prices before the IPO opens to the general public. The price will likely surge after opening, so it’s a pretty good offer.
Well they can buy puts without margin accounts, since those have a cap on the losses, which would also get more valuable if the stock price decreases. While technically a side bet, the options sellers often want to remain neutral in their risk with respect to movements of the underlying stocks, so buying options may influence stock price as well because of the downstream effects the options seller may undertake.
The expanded leverage of short term calls, though not directly buying the stock, may have been one thing that helped explode the GameStop share prices, as options sellers had to buy more shares to limit the losses on calls they had sold as the price increased (a gamma squeeze).