E-trader, Joe Campbell, decided to go $35,000 short KBIO and now owes $ETFC a wonderful $106K.
His GoFundMe page: https://www.gofundme.com/jwctrek
Lol
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He raised $2k already. How did Etrade not pull the plug on this sooner? Dude should just roll everything into his 401k and declare bankruptcy.
This is why you buy puts and why I never short stocks.
or at least have some stop orders in place
Lol. Dude's in over his head
This may be the worst luck ever. The stock has traded below 4 the whole year, and it went to like 18 today. But it's back at 10. It will probably crash down. Hopefully he hasn't been able to close his position because he doesn't have the money.
Sucks because the stock was around $10 in trading today, would have been out only like $72,000 then... That sucks so bad!
Is this real? I don't know much about trading, but judging from the comments on GoFundMe, it looks like this guy might be making this up.
O_O
That sucks, bro. He said he cashed out of the position but DAMN I hope he didn't.
wow...just...wow
Can someone explain this as one would to a child? I thought I understood shorting and the risk involved, but from the comments on the Go Fund Me it appears I only understand it in an very elementary sense. Are the commenters correct in that this guy was just a moron? Is the guy correct in that E-Trade shouldn't have let it get that far without notification? What's your take?
The real problem was the stock went up too quickly.
Yesterday during regular trading hours the price didn't go crazy. Then Martin Shkreli announces he took a controlling stake in the company. This sparked a rally after hours that continued into pre market today.
It looks like his broker doesn't pay attention to after/pre markets so they didn't cover his position due to a Margin Call.
This guy claims that "At the close of the bell I saw the quote montage clear out and figured today there was no action after hours in the stock." Which means he didn't wait more than 5 minutes to check the quotes.
He either shorted before Martin started buying and didn't cover or during. Either way you can see clear as day in the 1 month chart that someone is buying out the company. Why would there me 100% price increase on high volume on the 16th and 17th when the company announced they were closing on the 13th.
Martin Shkreli is just shafting everybody! The man is unstoppable.
I'm sure you understand that the max profit is the dollar price of the share but losses are in theory unlimited. in practice, most brokerages will have limits on margin losses (usually as a % of the account) and then they will sell you out, but to my knowledge, there's no law dictating what this dollar amount is. the reason losses got to where they are has been mentioned: it happened so fast it caught him by surprise.
but yes, he is an idiot for shorting. it's not eTrade's fault to minimize his losses, it's his job to keep track of his positions. I hope he learned his lesson.
Next time I gamble $100k at the casino and lose, I know how I'll be raising money.
This is why shorting is best done with other people's money.
GoFundMe has put a kink in Darwinism.
As for shorting, there is nothing wrong with it if you A) actually know what you are doing B) don't make short trades in a bull market with out stops C) don't go crying to the internet after you tanked your entire life savings by not follow the previous two rules.
He should have thought ahead enough to straddle this one. At least have a stop. Unbelievable that people are donating to his GoFundME though.
Looks like it was taken down.
I honestly, have no clue how you could ever go short after the price action and volume that in-sued on nov 16th.
I read about this story and this guy was really new to trading and clearly had no idea what he was doing. If he actually looked at the chart he would have never shorted this after nov 16.....
Still gotta feel bad for him, Martin Shkreli, pumped this thing and made millions, if I was him, I would foot this guys bill with my millions in profits... He definitely manipulated it
That's a fun way to wake up. Reminds me of the surprise rate cut days.
Now KaloBios declared bankruptcy... lol guy had a good thesis apparently, but left himself exposed to too much risk overnight... Martin Shkreli did just enough to screw this trader over!
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