Thread by @don_palme

To all the #COKE stockholders,

The reason you lost money today is abusive short selling on ETF's containing the S&P Small Cap 600.

The ETF's were used to indirectly short another company in this index, so the short sellers bought all other stocks in the ETF including $COKE...

So when $COKE left the index today, the short sellers had to get rid of these additional stakes in $COKE at all cost.

This created the massive sellof you experienced.

By the way: $COKE was replaced by $GRBK Green Brick Partners in the index, which rose about 9% today...

This means abusive short selling of S&P Small Cap 600 ETF's led to the massive manipulation of #COKEstock price.

Please complain about this to @SECGov and @USDOJ_Intl

If you wonder which stock was sold short indirectly using these ETF's visit r/superstonk on reddit.

#GameStop

For clarification:

If you want to indirectly short a hard to borrow stock, you can just short an ETF containing it. You then buy stakes in all the other underlying securities in this ETF.

This makes you net short only the one stock you did not buy a stake in.

This is also the explaination for ETFs having a short interest of sometimes 100+% (e.g. $XRT)

You can rinse and repeat this process to short as long as you want.

At some points the overall held shares of these ETFs will exceed the outstanding, which should be impossible.

Fun fact:

If a trading firm would use this practise, their books would look something like this: