Hedge funds borrow stocks and sell them immediately with the intent of causing the price to go down before they have to pay back the loan. The difference is the amount they can pocket as profit.
This was happening to a few stocks, but instead of being happy with a 5x decrease in value they continued to try and “short” the stock price. They became so leveraged in the risk that their moves became telegraphed and enough people were able to buy the stock that it went up in value much higher than when hedge funds borrowed the stock.
Hedge funds bet on failure and pull dirty tricks to lower stock values before having to pay off the loan. This time they were beaten at their own game and will owe billions to the brokers on the loan.
The secondary issue is it has exposed the rigged nature of the system because they have been successful in shutting down the purchasing of the stock by the little guy in an attempt to minimize increases in the stock value. The more we buy, the more they will owe and it will require major investors to pay off the loans to the tune of around 4 billion dollars.
Hedge funds borrow stocks and sell them immediately with the intent of causing the price to go down before they have to pay back the loan. The difference is the amount they can pocket as profit.
This was happening to a few stocks, but instead of being happy with a 5x decrease in value they continued to try and “short” the stock price. They became so leveraged in the risk that their moves became telegraphed and enough people were able to buy the stock that it went up in value much higher than when hedge funds borrowed the stock.
Hedge funds bet on failure and pull dirty tricks to lower stock values before having to pay off the loan. This time they were beaten at their own game and will owe billions to the brokers on the loan.
The secondary issue is it has exposed the rigged nature of the system because they have been successful in shutting down the purchasing of the stock by the little guy in an attempt to minimize increases in the stock value. The more we buy, the more they will owe and it will require major investors to pay off the loans to the tune of around 4 billion dollars.