Re:GameStop Is Rage Against the Financial Machine
by coliveira on Thursday January 28, 2021 @01:44AM
(#25938954)
> could short 30% of the float in GME, and it'd still only be 2% of their portfolio
That would be true if it wasn't for leverage. When using portfolio margining, the leverage is huge. So a relatively small change in the stock will result in large losses. Now, you're right that this is not going to break a fund like Citadel, but not all hedge funds are that huge.
That would be true if it wasn't for leverage. When using portfolio margining, the leverage is huge. So a relatively small change in the stock will result in large losses. Now, you're right that this is not going to break a fund like Citadel, but not all hedge funds are that huge.