Reddit’s profane, greedy traders are shaking up the stock market

Come on man, there&#x27;s no where near enough volume there to move anything but the most low volume of stocks. All they trade in is meme stocks like TSLA, NFLX, MSFT, AAPL etc., and a few 100k on calls here or there won&#x27;t budge the price in the slightest.<p>On top of that, it&#x27;s not even a P&amp;D group, people there are just trading against each other, you have both bears and bulls and thetas. There&#x27;s never been a concerted effort to pump SPCE for instance.

As someone who was a very early member of &#x2F;r&#x2F;wallstreetbets:<p>1) &#x2F;r&#x2F;wallstreetbets and &#x2F;r&#x2F;wsb are two different subreddits. &#x2F;r&#x2F;wsb are for those that got banned from wallstreetbets<p>2) When wallstreetbets first started it wasn’t as crazy as it was today. There were some aggressive gamblers but there was opportunity for real due diligence and decent conversation. I contributed more than a few posts back in the early days. After it got crazy I unsubscribed until recently. Robinhood and the options trading and margin trading has really made things crazy. I see absurd bets made on there that make me both jealous and glad I’m not 25 with too much money to gamble.<p>3) those who say it’s likely too small to make a difference go check out the timing of the Lumber Liquidator due diligence post and the subsequent jump in price. I don’t know what the difference is between pump and dump vs posting due diligence but there definitely was a correlation. I wish I still had my data account because I would love to see the exact correlation of options trading and stock trading to the posts.<p>4) the memes and gifs are hilarious if not vulgar and bigoted. But if you have thick skin some of the memes are very well made.

Back in the early 2000&#x27;s I worked for a company that was was hired (via intermediary law firms) by publicly listed companies to investigate pump and dump schemes on Yahoo message boards (you might call that the &quot;Reddit of the early 2000&#x27;s&quot;).<p>It involved a lot of web scraping Yahoo with Perl (specifically LWP) and then lots of analysis by humans with some help from automated tools. For example, if you plotted a histogram of each user&#x27;s posts, you could clearly see when someone was at work (posted between 9am and 5pm with a drop off around noon) and at home (posts between 6pm and 2am with a peak around 10pm).<p>The analysts would often find a piece of information from a 2 year old post, e.g. &#x27;Go Cubs!&#x27;, and a one week old post &quot;I just attended my 20 year UofI reunion&quot; and quickly be able to narrow down on who the person might be. Coupled with Lexis Nexis (which was just coming online at the time), we routinely narrowed down individuals to just one possible person.<p>Given that this was done back in the early 2000&#x27;s using ancient servers (by today&#x27;s standards) and basic statistical analysis with a lot of legwork, I would be surprised if there weren&#x27;t companies also trying to find the people on Reddit today.

Hey! I&#x27;d like to shamelessly plug my new project here:<p><a href="https:&#x2F;&#x2F;topstonks.com" rel="nofollow">https:&#x2F;&#x2F;topstonks.com</a><p>We&#x27;re writing about this speculative culture emanating from WSB and 4chan in a daily email. We send out a list of the most mentioned stocks, and do a longer form commentary, with quotes from those communities a few times a week.<p>It&#x27;s just an email now, but we&#x27;re going to roll out options analysis and a few other goodies in the coming weeks :)<p>(The language can be a bit crude, so this might not be for you, if that is a concern.)

&gt; You&#x27;re in private mode. Subscribe to continue reading in private mode.<p>I didn&#x27;t realise that Bloomberg blocks private mode too. Messages like this assume that tracking is the default and make sure that we keep losing privacy. I really dislike this trend.

So I was one of the first people on Wallstreetbets to post options YOLO around 2015, back then it was nothing but rainbow dick banners and penny stocks. I had previously interned at a brokerage and had just graduated college with a degree in physics(I understood the math behind options). Not hearing back from quant trading firms because I guess BSc is not enough for them, I said fuck it and started taking speculative bets on my own, lost half before I went all in on what I believed to be a fraudulent stock that was getting crushed, bought really far OTM weekly puts and was lucky that the CEOs collateral was liquidated which further tanked the stock. I then just bought AMD SQ when it IPOd and put the rest into ETFs and only traded small amounts on options the side. Just funny to see how far people ran with it. I tried warning people that while I wasn&#x27;t a &quot;pro&quot; and I was playing up a degenerate trader&#x2F;4chan character I was aware of the risk I was taking but we know how that turned out.

Wait, people actually go to &#x2F;r&#x2F;wsb for investment advice? The entire time I thought it was a mix of posting wins&#x2F;losses along with some memes&#x2F;humor.

As a regular of WSB, this article is just absolutely absurd. Which I guess is the regular for Bloomberg these days (seemingly the Buzzfeed of business news it appears). All you&#x27;ll find on WSB is a bunch of homophobic bored desk workers. The idea that subreddit of only a few thousand guys (mostly) with an extra $500 to blow on meme stocks can move a stock in _any_ significant way is laughable.

I have a pet conspiracy theory that WSB is used by insiders to signal trades to each other disguised as sh*tposts and hidden among the rest of the overwhelming noise.<p>I love WSB, though. It&#x27;s been a constant source of laughter and entertainment over the past few years. Now that it&#x27;s hit the mainstream, I hope the wild culture doesn&#x27;t dilute down too much.

Never underestimate the survivorship bias in public stock picking forums. Reddit is no exception.<p>There are a few honest stories of losses and failure in WSB, but the majority of loss stories or bad picks quickly fade into obscurity or are deleted by their original posters. What remains are the highly-upvoted success stories.

This article doesn&#x27;t seem to address 3 big issues: Firstly, most of the stuff on &#x2F;r&#x2F;WSB is talking about massive market cap companies like TSLA and AMD. Some punter putting his life savings in AMD puts is not going to actually move the market. I would love to see numbers on this but my gut says that reddit posters posting about their $50k investment in a company that is worth several billion is just retail noise. It&#x27;s not moving stocks.<p>Secondly, maybe there are some people genuinely attempting to use the forum to pump and dump but frankly, they&#x27;re probably not succeeding and even if they are, that&#x27;s exactly the sort of person the SEC is actually interested in prosecuting. But literally there is no evidence it&#x27;s happening at all, let alone at any scale or is profitable.<p>Finally, I love the idea that market makers are just sitting there going &quot;sure is weird that we&#x27;ve seen a lot of retail flow on MIK, better continue straight forwardly hedging using the future and not exploit this predictable market pattern&quot;

&#x2F;r&#x2F;wallstreetbets is one of those strange communities that provides nearly limitless comedy. Best watched from a distance.

Yes people are &quot;greedy&quot; who trade stocks. GTFO of here with that hype shit.

Matt Levine&#x27;s take: <a href="https:&#x2F;&#x2F;www.bloomberg.com&#x2F;news&#x2F;newsletters&#x2F;2020-02-26&#x2F;money-stuff-reddit-posters-pick-the-stocks-now" rel="nofollow">https:&#x2F;&#x2F;www.bloomberg.com&#x2F;news&#x2F;newsletters&#x2F;2020-02-26&#x2F;money-...</a><p>I&#x27;d really recommend subscribing (free, email, don&#x27;t think there&#x27;s RSS) if you don&#x27;t already (I got the recommendation on HN). He&#x27;s prolific though, rarely a day without an email, and often two or three - it wasn&#x27;t long before I couldn&#x27;t keep up; I just skim and read more thoroughly those that grab my attention now.

Interesting parallels w Bernie bro story: we can&#x27;t tell if they actually have any influence, and we can&#x27;t tell if they did have an influence whether or not that would be a good thing. All we really know is that the old school whales like Bloomberg find them annoying.

I use Robinhood app to gamble on options, most of the times I lose and sometimes I won big to cover all losses.<p>I don&#x27;t understand options, other than a few things about them which help me trade them<p>It&#x27;s ok to ignore the big picture. Not everything has to have a profound meaning behind and similar are the stock moves. I believe most of the movements are irrational, so studying fundamentals or anything is going to offer nothing other than wasted time.<p>I love the crazy vibe of that subreddit which motivates me to take crazy positions which I&#x27;d have never taken if I carried on with my risk averse friends.<p>Even if probability of becoming double digit millionaire from a single digit millionaire is small through options trading. It&#x27;s well worth it because once you&#x27;ve saved enough to retire, why not bet on random positions? You never know when you&#x27;ll fall on the long tail end of the game and experience the Black Swan event which changes your life forever.<p>Then I am also doing other things which people might consider crazy like steroids to maintain Greek god physique - considering neither I am model, atheletic or body builder.<p>YOLO is not bad way to live if it gives you the highs you need move out of sorrows and sufferings.

Couldn&#x27;t you replace this headline with, &quot;Wall Street&#x27;s profane, greedy traders are shaking up the stock market&quot; and have it be as valid, if not more, than talking about people on reddit?

People dismiss wsb but gambling is a big issue here in the US. This is exactly what happened during dotcom.

This is giving wayyyy too much credit to a sub-reddit that&#x27;s all about poking fun at the trading game, and each others. Please don&#x27;t throw your money away following them.

I recall there&#x27;s a way to sign up to an email subscription of Matt Levine&#x27;s writing, without Bloomberg and their pop-ups. Anyone know how to do that?

Wow, this title sure got changed to something far more inflamatory than it was an hour ago, when it was something closer to &quot;reddit picks your stock&quot;. Nice one, bloomberg.<p>Oh wait, Bloomberg&#x27;s trying to run for president?<p>Owning one of the authoritative news outlets feels like maybe that&#x27;s an illegal conflict of interest, there, then.

For those interested in r&#x2F;WSB&#x27;s reactions... <a href="https:&#x2F;&#x2F;www.reddit.com&#x2F;r&#x2F;wallstreetbets&#x2F;comments&#x2F;f9sx9d&#x2F;congrats_autists_the_cover_of_bloomberg&#x2F;" rel="nofollow">https:&#x2F;&#x2F;www.reddit.com&#x2F;r&#x2F;wallstreetbets&#x2F;comments&#x2F;f9sx9d&#x2F;cong...</a>

Someone started a cryptocurrency version of WSB recently as well: <a href="https:&#x2F;&#x2F;www.reddit.com&#x2F;r&#x2F;SatoshiStreetBets&#x2F;" rel="nofollow">https:&#x2F;&#x2F;www.reddit.com&#x2F;r&#x2F;SatoshiStreetBets&#x2F;</a>

Related: r&#x2F;pennystocks<p><a href="https:&#x2F;&#x2F;twitter.com&#x2F;packyM&#x2F;status&#x2F;1229910436184756225?s=20" rel="nofollow">https:&#x2F;&#x2F;twitter.com&#x2F;packyM&#x2F;status&#x2F;1229910436184756225?s=20</a>

Related column: <a href="https:&#x2F;&#x2F;news.ycombinator.com&#x2F;item?id=22425390" rel="nofollow">https:&#x2F;&#x2F;news.ycombinator.com&#x2F;item?id=22425390</a>

Are the effect of the coronavirus on the stock market could be opportunity for investing? The SP500 went down 8% this past 5 days. I&#x27;m wondering if that will go lower those next days.<p>I have a bit amount of money on the side, I didn&#x27;t know where to invest. Would now be a good opportunity to lump sum all the money, or would you Dollar Cost Average?<p>Anyone else with the same dilemma, and would have more arguments? Or maybe an other perspective on that?

Sentiment analysis is not new, and I would imagine it&#x27;s ancillary at best to a proper trading outfit. Well equipped market makers and HFTs make money on price movement (and exchange rebates). A flurry of out-of-the-money calls is unlikely to adjust an underlying equity price significantly enough to be statistically important.

<a href="https:&#x2F;&#x2F;archive.md&#x2F;GncCZ" rel="nofollow">https:&#x2F;&#x2F;archive.md&#x2F;GncCZ</a>

Usually if you think you are fcking someone in the stock market, you are usually the one being fcked

The article&#x27;s opening paragraph might have been a somewhat accurate depiction of reddit 12-13 years ago, but it&#x27;s changed a lot since then. It&#x27;s hard to take the author that seriously when the bias against reddit is that clear in the lede.

&gt; After years of indifference, individual investors seem to be finding their way back to stocks, for better or worse.<p>There&#x27;s an old adage in London that it&#x27;s time to sell when the retail buyers start entering the marketing...

In other news, Vegas&#x27; profane, greedy gamblers are shaking up the economy.

New side-project idea: WSB sentiment analysis tracker linked to RobinHood API

What&#x27;s wrong with ordinary traders taking advantage of the flaws in dealers and big money bots? Aren&#x27;t they (dealers and such) the ones who have been doing it forever?

I can&#x27;t even scroll the page on my computer using Safari. It just freezes immediately. Is a Core i5-6500 already too old for Web browsing?

A very prescient XKCD (which as afar as I can tell, was released before the article was published):<p><a href="https:&#x2F;&#x2F;xkcd.com&#x2F;2270&#x2F;" rel="nofollow">https:&#x2F;&#x2F;xkcd.com&#x2F;2270&#x2F;</a>

How is anything WSB does worse than say, high-frequency trading?

Can anyone explain the strategy it&#x27;s talking about?

Wall Street will catch on and come around to set a trap

what if it&#x27;s just HFT with some natural language AIs posting on reddit?

Oh my God they&#x27;re using swears?

Paywalled site, T$DR.

OK, Boomerberg.

So subreddits are either echo chambers or hopelessly conflicted? I&#x27;m not defending WSB but isn&#x27;t the entire point of internet forums &#x2F; reddit discussion to argue about things? I absolutely hate any subreddit where only one train of thought is allowed and everything else downvoted.

document.getElementById(&#x27;graphics-paywall-overlay&#x27;).remove();document.body.style = &#x27;overflow: auto;&#x27;

tl;dr the wallstreetbets hive mind has the purchasing power of a mid size hedge fund<p>if there’s roughly 1000 upvotes on a piece of content, and assuming only 1% of lurkers ever up vote; that means there are roughly 100,000 people taking investment info from this sub.<p>let’s say they have an average portfolio size of $10k, then 100,000 users * $10,000 = $1 billion dollars.<p>assuming they split the portfolio by meme %, so like 1&#x2F;3 TSLA, 1&#x2F;3 SPCE, 1&#x2F;3 AMD; then we’re looking at like $330 million in trading volume going into SPCE.<p>when you look at the last couple days of trading volume on SPCE, about 30million shares traded daily, was previously around $10 a share , it about equals out, that like $300million dollars of meme money did a pump and dump on SPCE