Oh no!
Anyway…
19 years old. Life savings. 🙄
Boomers keep telling me I should have put $20 in my savings account with every paycheck starting at age 18 and I’d be able to retire at 65. Dude was not going to be able to retire at 65 apparently.
He had $400 left in his account before the margin call. The trouble with options is that they can be very highly leveraged, meaning you’re trading on credit, and you can lose a lot of money really fast (and likewise, gain a lot of money really fast). Most brokerages don’t even let you trade on options until you can prove you have knowledge of how the market works. So the kid is probably smart, but like many smart 19 year olds, not smart enough.
This guy owes the brokerage $56k.
19 year old doesn’t have a lot of personal savings anyway not a big deal Time to start saving again. ¯_(ツ)_/¯
If I understand correctly, they can sell the shares they were forced to buy and get back most of the $56,000 they owe.
When you short a stock, you borrow a stock, then sell it, then you buy it back at a (ideally) lower price. Then, you have to give back the stock plus interest. This person can’t sell the stock because they have to give it back. It wasn’t theirs to begin with. They were just borrowing it.
$400 left.Who knows how much he started with initially.
E: started with about $7k
Where the hell is a teenager finding 7k? That takes some bootstraps pulling.
The problem with options trading is you can lose more money than you invest.
link to original if anyone is interested.
i wouldn’t outright call it fake,
at worst its misleading.
he misunderstood his account info and didn’t loose as much as he thinks.
wouldnt be the first make that mistake.
Oh shit, that reminded me of that guy who thought he owed something like 90k and killed himself only for the account to be settled the next day and he had earned money.
That’s about what I’d expect from wsb. Delusions of grandeur combined with complete failure to understand the modern world.