LogFAQs > #949995687

metallica846 posted...

What is the endgame of shorting a dying company like GameStop that these hedge funds were doing? What happens to their positions when the stock hits zero?

not too sure about stock hitting "zero" i think they'd be delisted before then

at some point they let their shorts expire and move on

the semi legitimate complaint is that short selling puts downward pressure on a stock, which could be abused
but it's generally going to be legitimate downward pressure. people go into short positions because they're confident the stock will go down* - which in GME is a legitimate stance because it's falling apart.
the ridiculous amount of shorts out on GME could be either a lot of legitimately negative outlook on the company, or nefarious coordination to push the price down. idk. if it's the latter that's obviously not ok, but is also not really relevant to whether pumping the price is ok either.

*and other hedging reasons
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