I wrote this earlier to try and explain this whole thing to some friends, and also posted in another thread, but I figured hey why not make it a whole post. First, full disclosure I have money invested already (so there’s a bit of a conflict of interest technically), I’m not a financial expert by any means (and this is not investing advice™), and I definitely missed some stuff, but I figure it might be useful as an explanation for everybody here since I haven’t actually seen anything actually go into the details too much.

With stocks you can do something called shorting, which is where where you think that a stock is going to go down, and what you do then is borrow shares from a broker for their current price, sell them, and at a specified date you buy the same amount of shares up and give them back to the broker, and you keep the difference. If the stock goes down, you make money, if it goes up however you can eat it big, because there’s technically no limit to how high a stock can rise. This is where the magic comes in.

Right now $GME, our beautiful GameStop, has a short interest of over 100%, which means its being shorted for more shares than are available for sale. This is because GameStop is yknow GameStop and it went down to $5 over the summer, and a couple Wall Street firms shorted them a bunch back then. Since the stock is going up so much, they’re gonna get absolutely screwed when the shorts come in, which should be happening sometime on Monday and Tuesday of next week.

The last piece of the puzzle is a bunch of nerds on WSB refusing to sell their stock to the firms so that they can cover their shorts (give the stock broker the shares that were shorted), which creates a positive feedback loop of spiking the stock price. Remember, those firms have to cover those shorts, their assets can literally be seized otherwise, and if nobody wants to sell, then they have to offer more money. It’s like offering to pay somebody on the street more and more money for the shirt on their back until you finally offer them $1000 and they give it to you. This situation is called an “infinite short squeeze,” and as long as people keep holding it should keep going up, and lord knows they’re going to keep holding.

What you might need to on your end, if you’re interested in this modern day robin-hood tale, is buy some $GME for as low as you can, preferably on opening on money or a dip otherwise, and hold on to it for as long as possible while the price rises. WSB seems to think it could go as high as $1000, take it with a grain of salt, but also keep that in mind when you’re deciding the price you want to sell at. I’d recommend holding for as long as possible as it goes up, since it’s usually better to sell too late after the peak than too early and completely miss it, but you know your situation better than I do.

There are a few possible pitfalls in all of this. GameStop could issue more stock and ruin the short squeeze, people might sell too early before it can reach a number that’s truly crazy, and probably some pmore that I don’t remember, but even so it’s still looking pretty good for it.

In conclusion, money is fake anyway, Marx day traded so don’t feel bad, don’t gamble more than you can afford (because it is gambling lol), and don’t say I didn’t warn you. If you have any more questions I’m afraid you’re probably going to actually go to WSB and check out their DD (due diligence) threads, but be ready to deal with a looooot of ableism. It’s probably too late in the game to make millions of dollars like some people on WSB, but definitely still time to put a good dent in some debt you might have and maybe have a bit left over for some mutual aid, who knows. Happy gambling. 💎🤲🚀🚀🚀

e: $GAM -> GME I am a fool