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Re:u/DeepFuckingValue and the GameStop Reddit mania by adolph on Friday January 29, 2021 @10:07PM (#25965628)
If nobody buys, does the trillion dollar seller make a sound?
Re:u/DeepFuckingValue and the GameStop Reddit mania by jbverschoor on Saturday January 30, 2021 @02:01AM (#25966943)
If they sold a call option which is exercised, they’d HAVE to buy
Re:u/DeepFuckingValue and the GameStop Reddit mania by jjeaff on Friday January 29, 2021 @10:40PM (#25965777)
Only if insolvency makes a sound. If the shorts don't have the trillion dollars to buy that stock to pay back the debt by the deadline then they are sol.
Re:u/DeepFuckingValue and the GameStop Reddit mania by ericd on Saturday January 30, 2021 @01:14AM (#25966710)
What deadline exists for shorts, assuming these aren't puts?
Re:u/DeepFuckingValue and the GameStop Reddit mania by joncrane on Saturday January 30, 2021 @06:52AM (#25968354)
Shorting doesn't only mean short stock. You can be short call options, and if they are in the money, the holder of the contract can exercise his or her option, which forces the seller of the contract to provide shares at whatever price.

For every long call option contract, there is a counterparty who is subject to unlimited upside price risk, just as a traditional stock shorter. The difference is the contract has an end date.

I would argue that options account for more of the pressure/volatility of these recent stock prices than the shares themselves.

Re:u/DeepFuckingValue and the GameStop Reddit mania by jbverschoor on Saturday January 30, 2021 @02:02AM (#25966953)
Today was the monthly option expiration day.

But of course not all options expire at the same time