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formvoltron | on: SpaceX bond worth 10% less than issue price – heading for junk bond status
nah the very worst thing about the spacex ipo is that schwab won't allow me to short it. has nothing to do with the recency of the issue. today i shorted some skhy when i realized it's trading about 30% over the Korean share price (I could be wrong about that)
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chasd00 | parent | next
> nah the very worst thing about the spacex ipo is that schwab won't allow me to short it.

there are easier ways to make money than betting against Elon Musk. See Tesla and how well it worked out for short sellers there.

I like SpaceX as a company (especially Starlink) but it's over valued in my opinion. In about a year when there's a little bit of public financial history and the dilution is over i'll probably buy in.

mlinhares | root | parent
The illusion isn't over for Tesla, not a chance it will be over for SpaceX in a year.
runarberg | parent | next
I for one am glad that you were not allowed to short SpaceX. People gaming the market for their own profits are the worst kind of exploiters and swindlers. You contribute absolutely nothing while siphoning the profits that workers make, lowering the salaries of everyone that actually works for a living.

Note this has nothing to do with my feelings about SpaceX. I am Elon hater nr. 1 and hope SpaceX burns to dust, I only hope speculative investors burn down with it.

EDIT/CLARIFICATION: This post is fundamentally anti-capitalist. You may feel like I am mis-informed or misunderstanding. I am both of theses things if and only if Capitalism truly is self-evident.

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rurp | root | parent | next
What a weird misunderstanding. Shorting reduces fraud in the market, and making it harder to short increases it. There's a reason shady managers had shorts, it increases the chances their bad behavior will be uncovered and punished financially.
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tyre | parent
I'm not an investor in SpaceX but I don't think shorting stocks at IPO should be allowed. The market should be given time to settle on a price, and it's unlikely that anyone needs to short it on day 1 for hedging. It's purely price speculation.

Yeah, I know why people _want to_ (betting), but it doesn't serve a broader economic purpose.

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tclancy | root | parent | next
Betting is what everyone who jumped into retail investing and meme stocks does with it, but shorts are a valuable tool in the economy for hedging risk. It also is a good indicator for fraud too.
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shermantanktop | root | parent | next
“Broader economic purpose”?

It’s all betting.

If someone wants to dress it up in jargon or talk about beneficial second order effects, they can. But if putting money on an outcome you can’t control isn’t gambling, I don’t know what is.

names_are_hard | root | parent | next
Is buying insurance gambling? Is giving your second cousin 100k some money so he can open up is restaurant gambling if you expect a percent of the profits but won't actively be involved in advising him on running the business?
KellyCriterion | root | parent | next
Mh.... is there a difference between "betting" and "gambling" from wording here?
quickthrowman | root | parent
Gambling is placing a wager with a negative expected value. If you can gain an edge and have positive EV, it’s not gambling. That’s the distinction between poker and slots. A skilled poker player can take advantage of positive EV positions while slots are programmed to have negative EV. There are traders that have positive EV bets.
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toomuchtodo | root | parent | next
Why is line go up price discovery acceptable, but line go down price discovery not? If the shares are trading, you should be able to short, it’s arbitrary to disallow it. It is quite literally a part of the market settling on a price.

(under the assumption your broker is managing their risk if your losses from a short position potentially exceeds capital available for liquidation if the trade moves against you)

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somenameforme | root | parent
Because lines tend to trend up over time. You're betting on lines going down, and paying rent while doing so as shorting requires you to rent/borrow shares from somebody else. It's an extremely high risk activity that can easily result in an investor losing a very large amount of money.

Elon Musk is politicized so you're going to have people wanting to short against him, for reasons other than it being seen as a rational and sound investment strategy. This is one reason brokers tend to restrict this activity to certain types of investors who are more able to appreciate the risks, to say nothing of baseline necessities like needing a margin account to cover potential losses. Shorting is just very different than buying a stock.

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