- cross-posted to:
- internet
- cross-posted to:
- internet
Now the social media platform is aiming for an IPO in the first quarter of 2024 with a valuation of $15 billion, and has been in talks with potential investors like Goldman Sachs and and Morgan Stanley, per Bloomberg.
You get fronted 10 shares of X, based on the value it is today.
In Y amount of time, you need to pay back those X shares.
So if you think price will go down, you sell the shares immediately, and when you think the price is the lowest, you buy X shares again, and give them to who loaned them to you.
If you don’t buy enough shares, the person you borrowed them from buys them at whatever the price is when the clock runs out. And gives you the bill.
It’s also a way to lose insane amounts of money.
Like do it to 10 shares at $100/share. That’s a grand.
If the price goes up to $200/share, you owe twice as much.
With GameStop, people paid crazy prices a share, because they knew the big investors were all shorting.
No matter how high the price was, they were going to have to pay it. But the only people that really made my net, were the ones who sold. A couple people convinced thousand (millions?) Of idiots to drive the price up and then they cashed out.
Where people fuck up is shorting “penny stocks”. If it’s $0.10/share and you think it’ll go to $0.05/share, there’s a chance it goes up to $1.10/share or even more.
A couple dollars increases in price, and people could owe millions.
To add a little to the risk factor of shorting, your possibilities for losing money are endless. When you buy stock, the most you can lose is the price of the purchase. When you short sell you can lose everything you own and then some. If the price keeps going up, then you keep losing money until you close your position (buying the stock).
How does that work? You buy at $100 a share but if it increases to $200 a share you somehow lose money? That’s a strange layer to the stock market. Please explain.