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GMGMQ.PK - Why Is It So Good Now...As a Stock?

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June 09, 2009 – Comments (8) | RELATED TICKERS: GM

This 3rd entry in my blogs is more of a question than actual statement.  I don't get it.  Anyone know what is going on?

Being the most profitable stock in the last week going from the $0.30 range to $1.50+ today, the penny stock of GM has become a 5-bagger.  But does anyone know why? 

They say it is speculators rising it up.

They say it is short-sellers protecting themselves.

They say the limit is unknown as to how high the stock is going.

They say take your profits now and sell because in the end the shares will be worth nothing.

 

I say, what do you all say? :)

8 Comments – Post Your Own

#1) On June 09, 2009 at 10:22 AM, goldminingXpert (29.46) wrote:

I say it is so I can reload a red thumb on GM and make not one but two accurate picks... the second with a much better cost basis (1.70 and rising...) rather than the 1.51 I had before.

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#2) On June 09, 2009 at 10:52 AM, ChrisGraley (29.75) wrote:

The government is going to allow the new GM to write off the $87 bil in losses of the old GM. (Illegal, but does that ever stop this administration?)

That's why there is a pop in the stock now, but I wouldn't count on it lasting.

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#3) On June 09, 2009 at 11:23 AM, devoish (98.26) wrote:

I was going to close it yesterday with about 20 points and a plus five rating, and now I don't even get accuracy. 2 more points and it is in the red for me and I'll just have to wait it out.

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#4) On June 09, 2009 at 11:34 AM, goldminingXpert (29.46) wrote:

Closed at 1.51 +6 points, reopen at 1.64. Life is beautiful.

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#5) On June 09, 2009 at 11:38 AM, mikecart1 (98.87) wrote:

Did the same GMX ^.   :D

Life isn't beautiful though LOL.  I should of scooped up a 1000 shares at $1 and sold them off at $1.50.  Should of known that is what would of happened with the market the way it is nowadays.

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#6) On June 09, 2009 at 12:03 PM, 119862913 wrote:

I can't believe I just limited out of GM @ $1.74! Nobody said the game was fair (or rational). And why I'm saying this to you people, who are all painfully aware of this market factoid already, is beyond me (perhaps irrational).

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#7) On June 09, 2009 at 12:13 PM, ByrneShill (74.33) wrote:

Ever since it's on the pink sheets, it can't be shorted, so the market for gmgmq is distorted.

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#8) On June 13, 2009 at 2:39 PM, StoicAthos (< 20) wrote:

My theory is that GMGMQ is going through an options modified "pump and dump" by market traders- which consists of these steps:

 

1) buy up several thousand $1 June calls forpennies, 

 

2) buy tens of millions of GMGMQ strategically to cause a rally and make the price go over $1.50. It can't be shorted, so this can actually work.

 

3) buy up $1 June puts for $0.25 or less whichare frantically being sold back 

 

4) exercise or sell call options for a large profit, 

 

5) sell underlying GMGMQ which will drive theprice down, but the average sell price will be about even with the average buyprice

 

6) exercise put options for a large profit, orjust allow them to exercise on expiration.

 

The options are no longer tradeable for the average investor - who are just permitted to hold or sell their current positions, and I think that no new contracts may be written, but Wall Street CBOE insiders can still trade the existing contracts. 

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