It’s public. You can hedge the loan with puts.
by EricCartman (2024-03-25 22:17:49)

In reply to: The key words being "on paper"  posted by sprack

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I bet that someone will lend against that turd. The only question is who will do it.

Check out the put prices. Ouch
by gregmorrissey  (2024-03-26 10:16:50)     cannot delete  |  Edit  |  Return to Board  |  Ignore Poster   |   Highlight Poster  |   Cannot reply

9/20/2024 $70 strike asking price: $45.80
1/17/2025 $75 strike asking price: $56.00 (no $70 strike option listed)
1/16/2026 $70 strike asking price: $54.50


I'm not an options expert, but those prices indicate to me a lack of confidence in the current stock price.

It’s a very difficult stock to short
by DBCooper  (2024-03-26 16:04:48)     cannot delete  |  Edit  |  Return to Board  |  Ignore Poster   |   Highlight Poster  |   Cannot reply

Not many shares out there to borrow in order to short. And obviously short interest is heavy, so people are running to the put options to express that negativity. Hence the puts are expensive.

Trump owns 60%. There is no way that he is lending out...
by EricCartman  (2024-03-26 19:24:55)     cannot delete  |  Edit  |  Return to Board  |  Ignore Poster   |   Highlight Poster  |   Cannot reply

shares so that people can short this thing.

I wonder if he is legally allowed to sell deep ITM calls that expire in six months. That could be one way to raise his bond money...
Shouldn't there be zero for 30 days post IPO?
by AIRBORNEIRISH  (2024-03-26 18:35:54)     cannot delete  |  Edit  |  Return to Board  |  Ignore Poster   |   Highlight Poster  |   Cannot reply

You think the underwriter is lending out shares to short while acting as underwriter? I'm a bit out of my depth but feel fairly certain that should not be happening.
Only underwriters can’t lend for 30 days
by DBCooper  (2024-03-26 20:30:36)     cannot delete  |  Edit  |  Return to Board  |  Ignore Poster   |   Highlight Poster  |   Cannot reply

institutional and retail accts can lend out their shares for shorting.

IPOs always have a limited amount of shares to borrow in the beginning, but this stock has an exceptionally low number vs the average. It being a SPAC makes it even more difficult to borrow in the beginning. Alot of the normal institutional investors don’t get involved in SPACs
Back to EC's point though - DJT owns the vast majority
by AIRBORNEIRISH  (2024-03-28 11:43:24)     cannot delete  |  Edit  |  Return to Board  |  Ignore Poster   |   Highlight Poster  |   Cannot reply

of shares, the underwriters have some, and there aren't really any institutions involved in normal scale. So it seems like there shouldn't be many shares to short. Is naked shorting still a problem? Yes I've been out of the game that long.

This is very interesting stuff.
by airborneirish  (2024-03-26 20:54:54)     cannot delete  |  Edit  |  Return to Board  |  Ignore Poster   |   Highlight Poster  |   Cannot reply

The game has passed me by long ago and I don’t do anything that touches momentum type thinking.

I’ve learned many a time you can be right longer than you can be short. I wouldn’t want to be on the other side of this trade.
That said hahaha - not a single bruiser brand company has such shit financials. Fuck you Donald you fraud.

For DJT?
by EricCartman  (2024-03-26 10:25:46)     cannot delete  |  Edit  |  Return to Board  |  Ignore Poster   |   Highlight Poster  |   Cannot reply

I don't see any options trading today on E*Trade.

The IV was extremely high for DWAC, which is why the puts are expensive.
Pulled from Yahoo Finance
by gregmorrissey  (2024-03-26 10:30:25)     cannot delete  |  Edit  |  Return to Board  |  Ignore Poster   |   Highlight Poster  |   Cannot reply

It's possible that they are a carryover of the DWAC options as I'm not seeing DJT options on Schwab either.

I refreshed and the option chains appeared.
by EricCartman  (2024-03-26 11:07:23)     cannot delete  |  Edit  |  Return to Board  |  Ignore Poster   |   Highlight Poster  |   Cannot reply

The IV is wild. It is around 400% for this week, dropping to 124% for Jan-26.

The LT vol is reasonable, the ST vol is insane. That is what happens when a stock explodes.

My earlier point is that someone can loan to Trump while also hedging their position. It is a bit different than loaning against a private asset, which does not allow for the ability to hedge easily (maybe someone would enter into a private put contract. I've never heard of it, but that doesn't mean that it doesn't exist or isn't possible).
How could they hedge at those prices?
by gregmorrissey  (2024-03-26 11:32:48)     cannot delete  |  Edit  |  Return to Board  |  Ignore Poster   |   Highlight Poster  |   Cannot reply

Admittedly, as you pointed out, the volatility is wild. Assuming it settles down, maybe it becomes more feasible. I also suppose anyone lending would lend against his entire DJT position as collateral which makes hedging more reasonable.

Agreed on your point about pubic vs. private though I'm sure someone offers private asset option contracts --- not sure they'd be willing to offer them in a Trump-related transaction though.


Related, but off topic, I think it's ironic that the key to Trump's bond issue for a case where he claimed outlandish property values could end up being a stock that is actually trading at an outlandish value.

I never said the hedge was cheap. *
by EricCartman  (2024-03-26 15:51:42)     cannot delete  |  Edit  |  Return to Board  |  Ignore Poster   |   Highlight Poster  |   Cannot reply