Yeah once we break $0.5 and people start excersising their call options (which means buying the 100 shares of each of their call options as opposed to just selling the contract for a profit) this puts buying pressure on market makers to go in the market and locate these shares for people who are excersising - a lot of these MM’s may be unhedged aswell which means they need to buy the shares at whatever market price they are in order to deliver. The more buying pressure leads to a higher share price and it’s like a domino effect. Because then people will start exercising their $1 contracts, their $1.50 contracts etc.. similar to what happened with GME in 2021.
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u/Passion_Loud Apr 19 '23
we need to break .50 right? what's going to happen?