Gamestop Revisited

Because my broker disallowed purchases in GameStop stock after the run up, I decided they were not trustworthy. I transferred almost all my funds out into my bank account. Then I went back to my very first broker (which happened to also be my late father's broker). This all took a few weeks.

Lately, Gamestop stock has hovered around $200 a share. I think it is worth around $20 a share, maybe $30 tops if they have a turnaround. I doubt there will be any such turn around of selling physical games. So I did a small short term purchase of stock options betting against the stock. Pretty much lost all my money on that trade.

Well the earnings for the quarter were today. To prepare, I bought a bunch of options betting against the stock. This time around, I spent most of my money on options were either in the money, or just shy of in the money. These options cost a lot of money, especially when the expiration was far in the future.

Gamestop earnings and the subsequent call were nothing special. They did not beat analysts' estimates. However there was no announcement that they will issue more shares to dilute the value of the stock. So who knows where this thing will go. I hope the share value goes down and my puts go up.