they will definitely not do this because this would be highly illegal market manipulation. I think that Porsche will be in big trouble anyway because of all this. Lots of hedge funds could sue them and will sue them.
I thought people buying / holding on to longs in FRE and FNM in July and August was crazy. Yet I think the action in VW today wins the prize for craziness. I agree with Steve S on CNBC - this takes away from the integrity of the stockmarket. I know "integrity of the stockmarket" is a dubious notion in itself, but this is the kind of short squeeze you would expect with a <$1 billion biotech company, not a carmaker with a market cap of roughly 200 billion EUR, which was worth more than Exxon Mobil earlier today.
Niedersachsen / Lower Saxony could sell its stake, as you mentioned in an earlier post. 20% * 291 million shares = 58.2 million shares. This would be significant given the low float.
I am still short. Although it's tough watching it rally from low 600s to high 700s, I am making a small amount of change on the side from my long Porsche position. One of the many crazy things about this silly situation is that Porsche's 30% stake in VW has risen by over 50 billion Euros since last Friday, yet the market cap for Porsche has only gone up by <1 billion EUR. Patricia S on CNBC Europe said that she spoke to someone at the Frankfurt Stock Exchange about the situation, and the spokesperson said that this was just 'demand and supply'. My question is - do German securities laws contain anything related to the concept of market manipulation? Or maybe this is a situation of market manipulation only being enforced when a stock is going down. Maybe I should cover the VW short and just short the DAX instead? I'm still not over how crazy this all is.
well, it's not manipulation imho. and porsche does not have to go up, because if they start selling (which is unlikely, cause then the whole thing looks like manipulation), the price will soon collapse back down to 200 and lower. it really is supply and demand... i wonder what happens when US hedge funds manager come back to work this afternoon, yesterday the real big squeeze happened much later in the day..
I agree that Porsche does not have to go up, however as I mentioned previously, the company's stake in VW has increased in "value" by more than 50 billion EUR since last Friday. Yet the market cap has increased by less than 1 billion EUR.
yes, if you value it at current VOW share price, but i'd rather take the underlying company to determine the value of this stake. Because even if Porsche would, due to the market manipulation laws and so on, they could not sell right now. and if they start selling they might be able to sell 0.1-1% around current prices but market will pick up and go nose diving..
German regulators are as incompetent as german politicians. The whole Xetra-stock / Eurex-options trading (and regulation) is pure bullshit compared to US trading facilities. There have been numerous totally irregular situations like this one before with Xetra. Just remember Altana or Mobilcom. Such strange things happen ONLY IN FKing Germany. (Speaking of high volume/cap stocks) The whole thing needs to be re-engineered. Get a damn real market.
agree, i know situations were there was a reverse split, and brokers didn't adjust... but trading went on for several days although it was obvious market conditions are irregular (some were naked short huge volumes because they sold the initial amount of shares of the split one, ie. someone had 1000 after split 100 but since their broker didn't realise or got the notification too late, they sold 1000, and now were short 900)... after couple of days they finally realised something's wrong and reversed all the trades.. and all those scam stocks, worse than us otc, and people are still stupid enough to buy based on a spam e-mail