Category: Meme Stocks (Page 1 of 51)

“The Game is Rigged”, Says Ex-Citadel Data Scientist

Ex-Citadel employee Patrick McConlogue says the market is rigged.
Market News Daily: Ex-Citadel employee Patrick McConlogue says the market is rigged.

Patrick McConlogue, an ex-Citadel Data Scientist said during the ‘meme stock’ frenzy that the stock market is rigged, claiming he helped design it.

“The game is not fair and it never has been. Individual investors, even when operating in a swarm, are destined to lose. How do I know? I helped design the game.”

Not many investors know this, but Patrick actually breaks down how Citadel and other hedge funds were able to make billions back in only weeks from halts.

In this article, I’m going to share his words and knowledge in the industry directly with you.

Share this article to raise awareness of the market injustices ‘experts’ have claimed were never true.

Your voice matters.

Let’s get started.

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Ex-Citadel Employee Reveals Rigged Trading Game

Ex-Citadel employee Patrick McConlogue says the market is rigged.

Patrick McConlogue appeared on Fox Business during the ‘meme stock’ frenzy of 2021 when retail investors created one of the biggest scares in Wall Street history.

GameStop and AMC shareholders were able to create panic on Wall Street by heavily buying shares of the overleveraged shorted stocks.

As share prices soared, short sellers experienced massive losses.

GameStop was able to put Melvin Capital out of business, but Patrick McConlogue says other hedge funds were able to make back billions in losses during the halt.

The halts allowed hedge funds to enter AMC and GameStop knowing shares would plummet, allowing them to capitalize on the deflation of the price.

Patrick says the rules of the game also heavily favor hedge funds, something retail investors have urged SEC Chairman Gary Gensler for years to change.

“I respect many of my colleagues, the problem isn’t the people, it’s the rules of the game which heavily favor the funds.”

Below is ex-Citadel Data Scientist Patrick McConlogue’s story.

AMC Stock: The SEC Has Now Violated Threshold Rule

Patrick McConlogue Says the Stock Market is Rigged

Ex-Citadel employee Patrick McConlogue says the market is rigged.
Ex-Citadel employee Patrick McConlogue says the market is rigged.

“The game is not fair and it never has been. Individual investors, even when operating in a swarm, are destined to lose.

How do I know? I helped design the game.

A few years ago, I worked at the massive hedge fund Citadel. The multi-billion dollar fund was caught up in this week’s scandal for bailing out hedge fund Melvin Capital after everyday traders on Robinhood appeared close to liquidating the fund through mass buying of the GameStop stock $GME.

My role at Citadel was as an engineer in Long Term Quantitative Strategies. The entire department, filled with programmers and compliance officers, is dedicated to something called ‘alpha’ which determines the buying strategy of the fund.

I was responsible for innovative proprietary technology that capitalizes on public data faster than any other hedge fund. It’s a classic situation of machines against humans. I respect many of my colleagues, the problem isn’t the people, it’s the rules of the game which heavily favor the funds.

A group of traders on the r/WallStreetBets Reddit thread, now consisting of over 8.6M members, noticed that someone had overly “shorted” the GameStop $GME stock.

They decided it was the perfect time to buy. It was only around $18 per share and easily affordable for the common investor who kept buying, driving up the price of the stock.

As the buying frenzy continued the hedge funds who had taken the opposite position started to hemorrhage money.. BIG money.

The small investors celebrated their success online as news broke that the hedge fund Melvin Capital Management had lost so much on the $GME short position that they had to be bailed out by bigger hedge funds.

While the markets were closed Melvin Capital’s sinking battleship received an emergency infusion of $2.75 billion from Citadel and Point72.”

‘Meme Stock’ Halts

Ex-Citadel employee Patrick McConlogue says the market is rigged.

“On Thursday morning, Robinhood — the commission-free stock trading app used by small investors — suddenly shut down buys on $GME and a few other stocks that were under siege.

Only sell orders went through, reversing the trend, driving the stock prices back down and shoring up the hedge funds’ sinking ships. Remember, when the stock price goes down, the people who hold the “shorts” make money.

This started a chain reaction. Other retail trading platforms like E*Trade and TD AmeriTrade began freezing the stock for individual investors. But hedge funds own supercomputers.

They have direct access to stock markets. While small investors were frozen the hedge funds traded massive positions and quickly earned back the billions in losses from the past few days.

The rules of the game had been exposed, in broad daylight no less.

Robinhood users, when signing up for the popular trading app that offered “free trading” were likely unaware of their role in the hedge funds’ ability to reap huge profits.

The system is broken.”

Patrick McConlogue left Citadel for decentralized finance and co-founded a new technology called Overline that takes the philosophy of DeFi to the extreme.

Not only is Overline unable to freeze any of your assets but it can’t even turn off the exchange; it’s not possible.

You can read Patrick’s full write-up here.

Related: Ken Griffin Thanks Redditors for ‘Meme Stocks’

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Market News Today - Ex-Citadel data scientist says the market is rigged.
Market News Today – Ex-Citadel Data Scientist says the market is rigged.

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Robinhood Now Wins Case Over Manipulative Meme Stock Halts

Market News Daily - Robinhood Now Wins Case Over Manipulative Meme Stock Halts.
Market News Daily – Robinhood Now Wins Case Over Manipulative Meme Stock Halts.

Robinhood has won a case over the manipulative ‘meme stock’ halts of 2021 which allowed hedge funds like Citadel to make their losses back.

The 11th U.S. Circuit Court of Appeals in Atlanta ruled 3-0 in its favor regarding the trading restriction of 13 meme stocks back in 2021.

These stocks included AMC Entertainment (NYSE:AMC), GameStop (NYSE:GME) and Bed Bath & Beyond (OTCMKTS:BBBYQ), among others.

In a proposed class action, shareholders of the 13 stocks alleged that they suffered damages because they were restricted from trading.

“When Robinhood restricted its customers’ ability to buy meme stocks, it took a sizable — and perhaps justifiable — hit in the court of public opinion,” wrote Circuit Judge Britt Grant.

“But in this court, Robinhood is only accountable for specific legal duties.”

“The court’s decision echoed a ruling by Chief Judge Cecilia Altonaga in November 2021. On top of that, the Atlanta court also dismissed claims that alleged Robinhood was negligent in protecting its customers from losing money and that it unsuccessfully ensured that its “mission critical systems” worked accordingly,” reports IP.

In May, AMC CEO Adam Aron said the company was seeking to sue Robinhood after the platform had reported the movie theatre chain had filed for bankruptcy.

“What the DUCK !!!!! I am getting multiple reports that Robinhood briefly posted today that AMC filed for bankruptcy.

How can companies like Robinhood do this?

So ludicrous, so wrong, so irresponsible.

On Friday, we report Q1 earnings, and will announce our sizable cash position,” said AMC CEO Adam Aron in a statement on social media at the time.

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Conflicts of Interest Keep Wall Street Safe

Market News Daily - Robinhood Now Wins Case Over Manipulative Meme Stock Halts.
Market News Daily – Robinhood Now Wins Case Over Manipulative Meme Stock Halts.

Patrick McConlogue, an ex-Citadel data scientist appeared on Fox Business during the ‘meme stock’ frenzy of 2021 when retail investors created one of the biggest scares in Wall Street history.

GameStop and AMC shareholders were able to create panic on Wall Street by heavily buying shares of the overleveraged shorted stocks.

As share prices soared, short sellers experienced massive losses.

GameStop was able to put Melvin Capital out of business, but Patrick McConlogue says other hedge funds were able to make back billions in losses during the halt.

The halts allowed hedge funds to enter AMC and GameStop knowing shares would plummet, allowing them to capitalize on the deflation of the price.

Patrick says the rules of the game also heavily favor hedge funds, something retail investors have urged SEC Chairman Gary Gensler for years to change.

“The game is not fair and it never has been. Individual investors, even when operating in a swarm, are destined to lose. How do I know? I helped design the game.”

Retail investors are viewing Robinhood’s case win as an act of oppression in the financial markets.

Rules are bent however and whenever deemed necessary to keep the ball in Wall Street’s court.

But I’m curious to know your thoughts on this.

Leave a comment down below.

Also Read: Congress Now Says Not All Naked Shorts Are Illegal

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Market News Today - JPMorgan to Pay $290 Billion in New Epstein Case.
Market News Today – Robinhood Now Wins Case Over Manipulative Meme Stock Halts.

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AMC Has Now Risen More Than +45% in The Past Month

Market News Daily - AMC Has Now Risen More Than +45% in The Past Month.
Market News Daily – AMC Has Now Risen More Than +45% in The Past Month.

AMC Entertainment (NYSE:AMC) stock has now risen more than +45% in the past trading month and nearly 50% this year-to-date.

The movie theatre chain broke a new weekend high record this past weekend as “Barbenheimer” produced results bigger than anticipated.

“Barbie” ended up with $162 million in its first weekend of release, above Sunday’s already record-breaking estimate of $155 million. The Warner Bros. film, starring Margot Robbie declined just 9% from Saturday to bring in $43.7 million on Sunday.

“Oppenheimer,” also beat expectations with $82.4 million, slightly higher than Sunday’s huge $80.5 million projection.

At the international box office, Oppenheimer added $98 million for a global tally of $180 million.

“The box office powered to its fourth-biggest weekend in history with over $300 million industrywide,” says Variety.

Shares soared higher than +87% last Friday on the announcement that Vice Chancellor Morgan T. Zurn rejected a nine-figure settlement that would have let the conversion proceed while handing out extra stock to mitigate the impact on ordinary shareholders. 

“Accordingly, given the absolute imperative to be able to raise equity capital going forward, we take seriously the Court’s Friday ruling.

In response, yesterday we along with the plaintiffs filed with the Delaware Court, a modification of the legal release surrounding the settlement of the Delaware litigation in an effort to address the Court’s voiced concern.

If the Court agrees, it would be our hope to implement as soon as possible the plan approved in the AMC stockholders election in March,” said Adam Aron in a new letter to shareholders.

[stock_market_widget type=”chart” template=”basic” color=”#5679FF” assets=”AMC” range=”1mo” interval=”1d” axes=”true” cursor=”true” range_selector=”true” display_currency_symbol=”true” api=”yf”]

Is AMC Entertainment Out of The Woods Yet?

Market News Daily - AMC Has Now Risen More Than +45% in The Past Month.
Market News Daily – AMC Has Now Risen More Than +45% in The Past Month.

AMC Entertainment has demonstrated big progress in the past few years ever since retail investors were able to resuscitate the company from near bankruptcy.

The company has beat earnings expectations ever since 2021 as the movie theatre industry as a whole has begun to recover post-pandemic.

However, according to CEO Adam Aron, AMC Entertainment is not out of the woods just yet, although it has made substantial progress.

The key here is raising enough capital to keep the movie theatre company moving forward before running out of money.

“AMC must be in a position to raise equity capital. I repeat, to protect AMC’s shareholder value over the long term, we MUST be able to raise equity capital.

That is especially the case now with the added uncertainty caused by the writers and actors strikes, which could delay the release of movies currently scheduled for 2024 and 2025.

If we are unable to raise equity capital, the risk materially increases of AMC conceivably running out of cash in 2024 or 2025, or of AMC being unable to satisfactorily refinance and stretch out the maturity of some of our debt (which is required of us beginning as early as 2024.)

The risk of financial collapse is not whimsical. Cineworld/Regal, the second largest movie theatre chain in the world, fell into bankruptcy and their equity holders were essentially wiped out. Bed, Bath and Beyond which was viewed as the third most watched meme stock, also fell into bankruptcy and their equity holders also were essentially wiped out.

Fortunately, at AMC, we have been much smarter, much more agile and much more skillful. We have risen to every Covid challenge heretofore, and I have every confidence in our continued ability to successfully navigate through these complicated times,” Adam Aron said in his latest statement.

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Market News Today - AMC Has Now Risen More Than +45% in The Past Month.
Market News Today – AMC Has Now Risen More Than +45% in The Past Month.

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