Kenny West
Veteran
Im checking the charts for the Credit Susse holdings after their margin call. Im ready to call this early: they got margin called because of GME.
Look at Viacom and Discovery's year/3m charts. The media blames those stocks that were dumped during their margin call, but how? You look prior to the MC, all of those stocks have been on massive bull runs since January. By mid March, both of them were +100% gains, discovery was like +300% . What long gets margin called sitting on 100+% gains on their biggest holdings?
Now exhibit B: https://archive.is/iKrGX
Peep the first chart they post. The Archegos fund accounts were using normal, responsible trading margins literally up until the end of Jan/Beginning of February, then they begin trading on 5: 1 leverage portfolios. What changed in late January to cause these funds to start using such dangerously leveraged margins all of a sudden? GME's 400$ run & buying restrictions were placed Jan 29th.
Then in February they calmed down until around late in the month (when GME went from 40- 100 in a day) and all of a sudden they go even harder on the leverage.
So shortly after GME spikes and starts putting HFs near margin calls, Archegos puts their accounts on dangerously high margins? Why would they need so much cash immediately?
And 2 months later after their longs GAINED over 100% & 300% respectively, they get rekt'd???
No. The full story isnt being told yet. They must have had a position that had them underwater in January to force them into such desperation. The stories in the media painted dude as some sort of leverage gambler, but up until late January the funds were trading on normal margins.
Keep in mind that the new DTCC rules that were enacted BECAUSE of GME were the reason Archegos was investigated and popped in the first place.
I'm gonna wait for the real story to come out on this one
Look at Viacom and Discovery's year/3m charts. The media blames those stocks that were dumped during their margin call, but how? You look prior to the MC, all of those stocks have been on massive bull runs since January. By mid March, both of them were +100% gains, discovery was like +300% . What long gets margin called sitting on 100+% gains on their biggest holdings?
Now exhibit B: https://archive.is/iKrGX
Peep the first chart they post. The Archegos fund accounts were using normal, responsible trading margins literally up until the end of Jan/Beginning of February, then they begin trading on 5: 1 leverage portfolios. What changed in late January to cause these funds to start using such dangerously leveraged margins all of a sudden? GME's 400$ run & buying restrictions were placed Jan 29th.
Then in February they calmed down until around late in the month (when GME went from 40- 100 in a day) and all of a sudden they go even harder on the leverage.
So shortly after GME spikes and starts putting HFs near margin calls, Archegos puts their accounts on dangerously high margins? Why would they need so much cash immediately?
And 2 months later after their longs GAINED over 100% & 300% respectively, they get rekt'd???
No. The full story isnt being told yet. They must have had a position that had them underwater in January to force them into such desperation. The stories in the media painted dude as some sort of leverage gambler, but up until late January the funds were trading on normal margins.
Keep in mind that the new DTCC rules that were enacted BECAUSE of GME were the reason Archegos was investigated and popped in the first place.
I'm gonna wait for the real story to come out on this one
