Note: None of this is investment advice, do your own due diligence.

Some scattered thoughts on the $GME situation:

1) A real life robinhood story is entertaining, which explains why this situation has captured so much attention

2) Melvin vs r/WSB doesn’t exist in a bubble. Hedge funds are in competition with each other, it is a stretch to think that another fund didn’t notice an overload of shorts but some disorganized memeing redditors did

3) It’s by extension even more improbable to think that the memeing redditors were able to coordinate and act quickly enough without tipping off hedge funds / hfts

4) A lot of the technicals being spread around about the situation are plain false, which reveals a lot of people are just parroting instead of knowing what their actually doing

5) As the situation grows more mainstream, more people buy in due to meme / FOMO / being enchanted by the narrative.

6) WSB consensus seems split between “sell high after friday spike”, and “hold long, gamestock is viable”. The former is just gambling, hoping their sell order goes through at the right price, the later is just disillusion.

7) The later you bought the stocks, the more you have to lose. That means mainstream > influencers > internet savy / twitter > reddit > early investors / wall street in terms of risk. Each tier depends on the next to not want to miss out and buy the stocks.

8) Going back to 6), what is the exit strategy of most of the r/WSB crowd? What is preventing a race to the bottom where everyone thinks “let me sell before the crash?”. Selling high is hard, especially in pure speculation.

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If you made money, I am happy for you, but please try to cash out at least some of the earnings before the crash. I know the comradeship of “diamond hands” is romantic, but try to protect yourself before you get burned. Don’t think that group support will last when things go sour.

Cwong

Cwong