/biz/ - Business & Finance

>>30135052
Ja toch, hoeren neuken nooit meer werken

>>27580798
>Poli works for me
>t.ausfag

Thanks. wtf it ls saying poli takes a day? Im an ausfag too. Was it instant for you?

Educational copypasta from a previous thread, just so everyone understands the terminology here

Shorts DO NOT expire
Someone can short a stock as long as they want, no matter what the price goes to. The difficulty is that they have to pay interest fees AND put up collateral. The higher the market price goes, the higher the fees get AND the more collateral they need, thus the harder it becomes to maintain the short. They might even need to sell other positions if they wan to continue shorting. If instead, a shorter decides to exit, then that is when they need to buy shares at the higher market price. This can push the price even higher, making it even worse for anyone else still shorting, and start a feedback loop called a Short Squeeze. As more shorters give up and buy shares to exit, the price goes higher...

Days to Cover IS NOT an expiration date
It's just a calculation of how many shares are shorted divided by the average number of shares traded each day. A Days to Cover of 1.5 means it would take 1.5 days for every short to exit IF every single trade during that time was someone buying to exit a short position.

Options Contracts DO expire
For example, if you buy a "Call Option for 100 shares at $10, expiring Feb 5", then you have the right to buy 100 shares for $10 (strike price), any time before EOD Feb 5, regardless of what the market price is. The other party in the contract MUST have 100 shares to sell you for $10 or buy them at market price. If the price goes to $15, then they made a bad bet and need to buy shares at $15 to sell to you at $10. Often, if the market price goes above the strike price, they will buy some shares as a precaution. (It's better to buy at $15 and lose $5 than it is to wait and need to buy at $20 and lose $10, or worse...) This precautionary buying can push the price even higher making it worse for other option sellers who don't own shares yet, and start a feedback loop called a Gamma Squeeze.

Can you even come up with a reason Rabbihood would cap limit sells that isn't fear?