(Originally posted on January 29th. Updated on 4.10.21 – Updates after original post)
Yesterday, January 28th is one that will go down in history and the history making will continue for a while. In short, the internet just discovered that by banding together common individuals can beat evil Wall Street hedge funds at their own game! You can read the details in the news and so for this post I’m just going to relate my own experience as I am fortunate enough to be part of this!
I’ve been a member of r/wallstreetbets for some time. Their memes and general culture make me laugh and I also get some great stock picks to boot! It was in this Reddit sub where I learned about the stock FSTLY and decided to invest. Luckily for me, and also in thanks to COVID-19, the stock went from $17 to currently $110. A nice profit was made but contrary to the YOLO culture of r/wallstreetbets I’m still somewhat cautious so instead of tens of thousands of dollars it was in the high four digit profit category.
A quick note on my investing strategy is that I have many different buckets for my investments. One of them is my “risky bucket” where I as the name implies, take risks. By staying in this bucket I don’t get too excited and go overboard when emotion decides to creep in. These buckets are with a major, well known investment firm. I also decided to set up one more area where I could be “risky” and that was with Robinhood. Although it was intended to be another “risky” bucket it became my go to app to just have a quick look at how my investment strategy was working. I purchased only one or two shares of the main stocks I owned with the major investment firm because I liked Robinhood’s interface better and of course the no-fee trades! (The major investment firm got rid of their trading fees later). I look at my Robinhood app probably 15 times a day so I really keep a pulse on how my investments are going without having to look the boring interface of the main investment firm’s app. (I call it “main investment firm” as I’m skittish about putting too much info on the internet.)
Anywho, that is how I had everything set up. Now, let’s get to the excitement. On January 15th I saw something was going on in r/wallstreetbets with Gamestop and decided to purchase around $161.96 in shares (around $40 a stock). However, to my eternal shame and embarrassment I got nervous and quickly sold for a $7 loss.
I thought this was just internet chatter that wouldn’t go anywhere and I should risk even $160 on this chatter as it would probably just blow over. Little did I know GME was about to blow up the financial system and shine a huge light on the blatant corruption in our financial industry!
Over the next week GME has an unprecedented surge all driven by r/wallstreetbets. I kick myself for missing the beginning but know it is not over and I wanna play! However, now GME is too expensive for me so I’ve gone with one of the other targeted stocks and bought AMC. This is another one the hedge funds have shorted and has room for some explosive growth due to the internet fury at Wall Street right now.
I bought 55 AMC shares on Robinhood on January 27th. Then on the 28th is when the top blew off this whole thing and is the date which will live in infamy! One of the main evil Wall Street companies is called Citadel and they have a major relationship with Robinhood. Citadel is the one standing to lose billions if the GME / AMC and other stock prices go up so you know what happened? On January 28th Robinhood investors could no longer purchase shares of GME/AMC and others! I tested this myself and it was true! These stocks no longer showed up in search and I could only sell but not buy! What is this? It is illegal market manipulation by Citadel/Robinhood! They were protecting Citadel’s positions by not letting investors buy stocks which would hurt Citadel’s short positions.
This blatant, illegal activity in favor of protecting the ultra-rich at the expense of the common man lit an absolute fire under the r/wallstreetbets users which is still playing out and will for quite a while. In fact, this act in response by the internet realizing their power has shaken the entire financial world.
As for me I was livid at the injustice of it all. Americans cannot agree on many things these days but one underlying core value is that everyone should be allowed to make money. Well, the ultra-rich just gave the common man a (illegal) middle finger! Now this is no longer just about money but is a movement in itself.
Rich: “The poor should invest their money!”
Poor: Start to invest
Rich: “Wait, stop!”
I hadn’t planned on buying more AMC but due to Robinhoods actions I wanted to see if my main investment firm would do the same. It turns out they weren’t restricting anything. And so I went to my risky bucket, sold all my FSTLY and put it all in AMC. So far it looks like I put it in at the bottom too for $8/share, so we’ll see what happens. After that I looked at r/wallstreetbets and saw the fire continue to grow about Robinhood. Now famous people, politicians, the SEC, Elon Musk, everyone was commenting at the injustice of it all. Robinhood/Citadel are in major trouble and so I thought that perhaps I should get my holdings out of there.
I went to my major investment firm account and immediately set up a request to transfer everything out of Robinhood to the major firm. I also wrote a nasty 1-star review on the Google Play store. Today I’ve heard that Google removed around 100,000 of those newly created 1-star reviews but I see mine is still there. Robinhood was supposed to be for the common man and by restricting trading for their hedge fund masters they have turned their back on the people of Sherwood forest at one call from the Sheriff of Nottingham. Disgraceful
As of 10:42 AM on Jan 29th I’m watching my AMC shares as well as eagerly waiting for the transfer of my holdings on Robinhood to transfer to the major investment firm.
But before I go I want to say a word about crypto. r/cryptocurrency wants to replicate the GME experience but with DOGEcoin. I thought it would be fun to hold some of this coin and it has greatly increased! My main lesson in all of this is it is impossible to know what the future holds. Fate and the future twists and turns: thanks to technology I think the future becomes less predictable every single day! As for my prediction, I think Blockchain and crypto is the future. Our current system, both financial and political is completely corrupted. Time to computer code make the decisions.
More updates to come:
The GMC/AMC adventure is over for me. Let’s begin with proof of my stock purchases.
I never found the rhythm with GME. As I mentioned above I bought then immediately sold and missed out on the $400 spike. I did however buy back in when the price hit $114 and hung on for about a month before finally selling somewhere around $180 a share for around an $800 profit or so. I just never felt in tune with GME and although everyone else likes the stock I really did not. I buy what I like and GameStop has never been a store I particularly liked. The only reason we ever went into the store is because there was a GameStop right next to Momiji Ramen in Colma. My boys and I would often get ramen after karate practice and there was often a line. So we would bide our time by playing the games on display at GameStop but would rarely buy anything. I did try trading in a game once but the amount offered was so low it never seemed worth it. I also never went for the membership program because it costs money and I never bought anything other than the occasional toy from the store.
So as for the stock, I’m glad Reddit caused those predatory hedge funds quite a bit of monetary pain but the squeeze has yet to materialize. Perhaps it will and the true “diamond hands” will make a fortune. I just don’t see it but wish them well.
As for AMC I thought there would be more potential. All in I had close to $3K in AMC and was willing to let that ride a bit longer. I bought some at $18 and then “tripled down” at $8. I thought that perhaps since they were given a lifeline AMC would reinvent themselves or at least give us investors a glimmer of hope that AMC will improve themselves. Where is the Ryan Cohen of AMC? Now I may have fallen prey to disinformation campaigns but my gut told me to sell at approx $10.90. It was a literal gut feeling because I sold whilst on the toilet.
Their CEO Adam Aron is no Ryan Cohen and Adam took his millions in bonuses after we retail investors just saved his ass. Furthermore, they are looking at distributing more shares which will dilute the price of the stock. And on top of that I’m getting the feeling that AMC will not be doing anything spectacular but instead stick with the same boring business model of selling overpriced shitty food to customers paying a premium on tickets to watch a show in a dirty theater. I really never liked AMC and hadn’t been to the theaters in years, so why else did I think they had potential?
Well, I think everyone wants to get out of the house and going to the movies is something I think everyone will want to do simply because they can and miss the experience. As for me, I would go monthly if we had one of those theaters that sold good food, alcohol and had a nice ambiance. I had hoped that perhaps given a lifeline they might hint at possible improvements. Well, we haven’t heard squat from the CEO, or at least it hasn’t made any waves on Reddit or I would have read it. I was also promised somewhat of a squeeze which isn’t going to happen. Enough with the “paperhands bitch,” insults and “to the moon” nonsense mindlessly posted by who knows. As always it was fun to be part of an internet army but at the end of the day the internet is not concerned about my financial well being.
I could have held on longer even given all of the above but the main reason I pulled the trigger is I could use that money somewhere else and that is in crypto. I believe crypto does have the ability to have face melting gains both in the short term and over the long term as those gains combine with gut wrenching drops. Crypto is much more compelling to me than either GMC or AMC and so as a somewhat seasoned investor I go with my gut and my gut has been telling me to buy more crypto.
*Footnote – It seems selling FSTLY was a good decision as it has now dropped by half. However, I only sold my risk bucket FSTLY, I still hold it in other buckets as I like the stock.