I read this commented here somewhere but haven't confirmed. It's totally realistic speculation though. The thought is that Citadel or Point72 who gave Melvin Capital (the shorters) a cash infusion may have a stake in some of these brokerages as well. If not, then some other investment firm could have a common interest.
So think about it, if theoretically I'm Citadel, I save Melvin Capital with some of my funds in exchange for a decent ownership interest in Melvin Capital at likely a bargain price. Then I go to Robinhood that I also have a big interest in and push them to limit trades to help the shorters limit their losses. So, I've helped my new ownership interest in Melvin Capital that I got at a bargain price not lose as much on top of that.
It's totally all speculation, and most likely illegal in the old government, but at least in my opinion it's not far fetched. A couple strategic contributions to the right women in the party and the legal issues vanish.
I read this commented here somewhere but haven't confirmed. It's totally realistic speculation though. The thought is that Citadel or Point72 who gave Melvin Capital (the shorters) a cash infusion may have a stake in some of these brokerages as well. If not, then some other investment firm could have a common interest.
So think about it, if theoretically I'm Citadel, I save Melvin Capital with some of my funds in exchange for a decent ownership interest in Melvin Capital at likely a bargain price. Then I go to Robinhood that I also have a big interest in and push them to limit trades to help the shorters limit their losses. So, I've helped my new ownership interest in Melvin Capital that I got at a bargain price not lose as much on top of that.
It's totally all speculation, and most likely illegal in the old government, but at least in my opinion it's not far fetched. A couple strategic contributions to the right women in the party and the legal issues vanish.