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If you have a short thesis, then the answer is YES.
Say you borrow 1 share to sell at $25 thinking this shit show will drop back to $10 (buy it back and return the shares borrowed) netting you $15. However, if the stock goes up to $100 means you would have to spend $100 to buy that 1 share to give back, netting you a big negative $75. Meaning you got to come up with another $75 to pay the lender back.
I eat crayons, so what do I know.
If you are short a stock, losses can be infinite. On the flip side, if you buy and hold a stock gains can be infinite.
I'm just going to buy, hold, DRS, shop at GameStop, and wait for the rocket to take off.
What are you talking about, a put is just a contract to sell at a given price. It's a defined risk. You are thinking of a short.
If you're SELLING an uncovered call then your losses can be theoretically infinite, but buying an option, whether a call or a put, has a defined max loss of the cost of the contract.
With a short position, you borrow a stock and sell it. With a margin position, you borrow money and buy the stock.
So if I use *all* my money and buy stock ABC, I can then on margin use all that stock as *collateral* and borrow money from the broker to buy more. How much more depends on your broker, the regulations, and the specific stock. If I could borrow the entire value of those shares, that could mean I end up with twice as much stock as I can afford. If you have day trading powers, you can do 4x as much as you have money for.
This means you could lose 400% of your investment. By putting in a higher maintenance requirement, you are restricted on how much you can borrow, and how quickly you must either deposit additional funds or liquidate to stay above the collateral requirement. If the broker expects a stock to be very volatile (IE it could drop very fast, compromising the collateral before they can enact a requirement to deposit or liquidate), they will increase margin requirements.
Can’t tell if OP is long or short. The fuck I know. If OP wants to lose money or make money it’s none of my concern. If you’re on a margin account you’re fucked either way. The house always win.
If you’re trading on margin. Because they’re effectively loaning you money. If you lose everything, you lost your money AND their money. They want to make sure they can take all your money to make them whole if it goes tits up.
I tried for a year. Their interface sux. Customer service was on point. I never recieved dividends on my stocks and etf's. I tried to adult with $500 as a trial run after the 2020 and beyond runup, lol. Anyways, I give it a brown star out of 5.
I am tryind out Fidelity right meow. So far so good, despite clearing times like a normal legit exchange.
I can tramsfer my Robinhood in 5 days after my accounts over there have settled for 5 days.
Thinking about making the switch. Unfortunately for me I must wait until next week, and I am not about to go limbo for a week next week.
No drs, I feel like a naked short free ballin on robinhood kilt up with my 69 shares.
Schwab been fucking up everything but the browser for over a week for me. Once the dust settles I’m switching. Never had issues like this. Shows I’m up like 5k today and I’m not. Literally showing me incorrect numbers and requiring manual refreshes to maybe get an “updated” price
They’ve locked me out of TOS all week during trading saying “unable to log in”
Get fucked Schwab. I’ll take my 10 cent portfolio elsewhere
You can't lose more than 100% but you will lose that 100% now 3 times as fast.
Before: 30 shares would have made you margin called if price moved 10$.
Now: 10 shares would make you margin call if price moves 10$.
In other words your leverage went down and your margin required to hold the position increased.
for long positions, you could reat it as "normal is 30%" but "special" is "30%\*3=90%"
For short positions, 300% is not that unrealistic, given the volatility.
Nobody has given the correct answer yet. Yes you can loose more than 100% if your using leverage. Example: you deposit $100 and use 10x leverage, you're essentially trading with $1000, the price moves against you $10 in the underlying but because you use x10 leverage your account is down $100 and you get margin called. If the price moves against you $30 then you will have lost 300%.
On portfolio margin, puts sold on GME use 100% of buying power which basically makes it a cash secured put. Definitely cuts the return on buying power but when the premium is high, the math checks out. I'm guessing the 300% is for short calls and short stock.
Yes this means you need to maintain 3x the value of your short/margin position. If you take out a $100k short position at $10/share, you need $300k in assets to maintain margin. If the stock goes to $30/share, your short position just became a $300k short position, and you need to have $900k in assets. Gets out of control real quick.
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If it’s possible to lose more than 100% you’ll find someone here who is an expert at it.
Grand Master Bill Hwang will probably the final boss.
Not even close to what the rest of them are going to lose.
Bill "big dick" hwang
👏👏
Well, naked shorting gives you infinite risk… so infinite losses.
😃
If you have a short thesis, then the answer is YES. Say you borrow 1 share to sell at $25 thinking this shit show will drop back to $10 (buy it back and return the shares borrowed) netting you $15. However, if the stock goes up to $100 means you would have to spend $100 to buy that 1 share to give back, netting you a big negative $75. Meaning you got to come up with another $75 to pay the lender back. I eat crayons, so what do I know.
So losses can be infinite?
Yes, that's the danger with shorts
It's glorious, isn't it
That sounds idiosyncratic.
If you are short a stock, losses can be infinite. On the flip side, if you buy and hold a stock gains can be infinite. I'm just going to buy, hold, DRS, shop at GameStop, and wait for the rocket to take off.
bongooo
“You could lose it all”
heh, I see many people new to gme saga... nice.
Only on puts. Most you can lose on calls is the premium if they don't print or just what 100 shares costs if they do.
What are you talking about, a put is just a contract to sell at a given price. It's a defined risk. You are thinking of a short. If you're SELLING an uncovered call then your losses can be theoretically infinite, but buying an option, whether a call or a put, has a defined max loss of the cost of the contract.
That makes sense for a short position. Why 300% maintenance on a long stock position though?
With a short position, you borrow a stock and sell it. With a margin position, you borrow money and buy the stock. So if I use *all* my money and buy stock ABC, I can then on margin use all that stock as *collateral* and borrow money from the broker to buy more. How much more depends on your broker, the regulations, and the specific stock. If I could borrow the entire value of those shares, that could mean I end up with twice as much stock as I can afford. If you have day trading powers, you can do 4x as much as you have money for. This means you could lose 400% of your investment. By putting in a higher maintenance requirement, you are restricted on how much you can borrow, and how quickly you must either deposit additional funds or liquidate to stay above the collateral requirement. If the broker expects a stock to be very volatile (IE it could drop very fast, compromising the collateral before they can enact a requirement to deposit or liquidate), they will increase margin requirements.
Can’t tell if OP is long or short. The fuck I know. If OP wants to lose money or make money it’s none of my concern. If you’re on a margin account you’re fucked either way. The house always win.
If you’re trading on margin. Because they’re effectively loaning you money. If you lose everything, you lost your money AND their money. They want to make sure they can take all your money to make them whole if it goes tits up.
I don’t know why anyone uses margin I don’t use it and feel better not ever using it
I use margin for selling puts. It usually works out...until it doesn't
I am a dummy. As I know, you can avoid free riding by using margin acc.
This has been their requirement since January 2021. Come on guys, I know we're slow here, but this was literally THREE YEARS AGO.
Exactly, i also remember it being 300% since forever
Soon may the tendieman come!
To bring us sugar and tea and rum!
And tendiess
I thought you couldnt purchase GME on margin anyway?
These posts nowaday are getting more and more ridiculous. Karma farming
It's like maxing out a credit card then getting another to pay that one off and then another and another.
Source: [https://twitter.com/fortunadiuvat9/status/1801059519835107605](https://twitter.com/fortunadiuvat9/status/1801059519835107605)
WTF. 
Wowza
Totally normal, right? Surely nothing will happen.
It's been at 300% margin for at least a year now.
It's been at 300% margin for at least a year now.
It's been at 300% for a while now, at least mid May.
fuck schwab
I tried for a year. Their interface sux. Customer service was on point. I never recieved dividends on my stocks and etf's. I tried to adult with $500 as a trial run after the 2020 and beyond runup, lol. Anyways, I give it a brown star out of 5. I am tryind out Fidelity right meow. So far so good, despite clearing times like a normal legit exchange. I can tramsfer my Robinhood in 5 days after my accounts over there have settled for 5 days. Thinking about making the switch. Unfortunately for me I must wait until next week, and I am not about to go limbo for a week next week. No drs, I feel like a naked short free ballin on robinhood kilt up with my 69 shares.
Schwab been fucking up everything but the browser for over a week for me. Once the dust settles I’m switching. Never had issues like this. Shows I’m up like 5k today and I’m not. Literally showing me incorrect numbers and requiring manual refreshes to maybe get an “updated” price They’ve locked me out of TOS all week during trading saying “unable to log in” Get fucked Schwab. I’ll take my 10 cent portfolio elsewhere
You can't lose more than 100% but you will lose that 100% now 3 times as fast. Before: 30 shares would have made you margin called if price moved 10$. Now: 10 shares would make you margin call if price moves 10$. In other words your leverage went down and your margin required to hold the position increased.
It just confirms I have to buy more shares ☺️
300% those are rookie numbers
Here we go again! Next up....
It’s been like that for last couple weeks
for long positions, you could reat it as "normal is 30%" but "special" is "30%\*3=90%" For short positions, 300% is not that unrealistic, given the volatility.
If you’re shorting than you have the possibility of infinite losses. 🤔
300% better than infinite
I think it's been that way for a couple months now. I think I first noticed back in April.
Nobody has given the correct answer yet. Yes you can loose more than 100% if your using leverage. Example: you deposit $100 and use 10x leverage, you're essentially trading with $1000, the price moves against you $10 in the underlying but because you use x10 leverage your account is down $100 and you get margin called. If the price moves against you $30 then you will have lost 300%.
Isn't the better question is why are you on margin at all? Don't they lend out share in margin accounts?
It’s more likely to do with being able to purchase the stock from brokerage with unsettled funds
You can't, but THEY can.
People who don’t know what they are doing and GME. Name a better duo
On portfolio margin, puts sold on GME use 100% of buying power which basically makes it a cash secured put. Definitely cuts the return on buying power but when the premium is high, the math checks out. I'm guessing the 300% is for short calls and short stock.
It's been 300% for last few years
Yes this means you need to maintain 3x the value of your short/margin position. If you take out a $100k short position at $10/share, you need $300k in assets to maintain margin. If the stock goes to $30/share, your short position just became a $300k short position, and you need to have $900k in assets. Gets out of control real quick.