Activate Super-Duper, FREE MONEY Cheat Code!!!! May 12, 2021 Edition
So the saga continues! If you want to know what this is all about, why it's so fucked up, and how this possibly (even probably, at this point) relates to $GME, please check out my post from yesterday: https://www.reddit.com/r/Superstonk/comments/n9y4ke/more_super_hot_cheat_code_action/?utm_source=share&utm_medium=web2x&context=3
First let me preface by saying this is not financial advice, and purchasing OTM options are generally a terrible, terrible investment. For anyone thinking there is "free money" here, there is not. This is about false carry values, and how this phenomenon has the potential to make an insolvent account look solvent. There is no real value to these puts, which is the problem I'm trying to highlight.
Now a short recap of the action ...
For several weeks now I have been seeing wildly incorrect carry values on deep out of the money $BKNG Puts. The carry values should reflect the midpoint between the bid/ask. Options contract prices are multiplied by 100 since they cover 100 shares. So an option with a bid/ask of $.40/$.80 should have a carry value of $60.
The problem with incorrect carry values on options is an account could look solvent when it is, in fact, very much insolvent, necessitating a margin call. Citadel and other major players in the GME saga happen to carry a bunch of these Puts ($BKNG specifically, and many others generally). You can see the details here for yourself (https://whalewisdom.com/stock/pcln). You'll find Citadel's holdings on page 13. Whether or not Citadel still carries a bunch of $BKNG Puts, and whether or not those Puts are affected by this "glitch," I do not know. One thing I do know is everyone needs to be aware of this, and this "glitch" needs to get fixed ASAP.
Now on to today's $BKGN Put carry value super-duper, free money cheat code fuckery ... below is a screengrab of my portfolio, and below that are screen grabs of the bid/ask of each Put at the time I made the screengrab of my portfolio.
For you wrinkle-brained apes, I don't need to explain why this is so fucked up and how badly this could/can be abused.
For you smooth-brained apes, this could (I don't know that it is, but it could) be used by the bad guys to avoid a margin call and delay our long-awaited trip to the moon (and beyond).
Edit #1: What is also weird is the timestamps ... I took the three bid/ask images above at roughly the same time (around 11:10 AM ET) ... only the last of the three was showing an accurate timestamp.
I just revisted these, and the price is now correct for the May 14, '21 $1400P, but the May 21, '21 $1430P is still giving off this:
I hate to say this, but I am curious if this same carry value would show in a broker other than Etrade (which I'm on). It would cost someone $20 to test this out. And yeah, it's going to be a wasted $20 in all likelihood ... very, very doubtful $BKNG will be getting under $1430 by end of next week. I regret including this ... not only does the value jump around too unpredictably, but I think this is giving people the wrong impression that I am somehow saying there is money to be made here. There is not (so far as I know).
Edit #2: For what it's worth, someone else found some funny business with these same puts in a different broker app:
Posted May 12, 2021, 3:36 PM UTC · edited