Quote:
Originally Posted by Hog's Gone Fishin
Pulled from stocktwits:
#Citadel has been shorting companies like AMC/GME and others. Hedge funds like Citadel suffered massive losses in the hundreds of millions . The company is said to even have taken action against it asking the broker to suspend trading. During a testimony Citadel CEO Griffin admitted the short positions were now closed. A search of Bloomberg however revealed that Citadel not only have failed to cover the short positions from January, but those have actually grown exponentially.
Citadel can use Chinese commercial paper and bonds as collateral. Once Evergrande is declared bankrupt and has a D status, the hedge funds can no longer use the Chinese paper and bonds as collateral. As a result, they are unable to meet multi-billion dollar margin requirements and must sell shares to cover margins or close short positions. In doing so, hedge funds must buy AMC/GME at any price. Even if the market collapses, AMC and GME shares will soar. Apes ... you are going to be filthy rich.
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Right, so maybe I'm misreading this, but if the short positions are closed, aren't the margin requirements now gone?
At least with my hedging account, margin requirements have to be covered before the close of day. CBOT seats have been lost because of failure to cover.
I have a hard time believing NYSE will allow multi-month failure to maintain margin requirements.