Am I doing GME right? Seems too easy.

Since March 2025, GameStop has issued two rounds of Convertible Senior Notes due 2030, totaling $2.3 billion—both with a 0% interest rate.

These bonds let holders convert debt into GME shares at key thresholds: • March bonds: Convert at $29.85 • June bonds: Convert at $28.91

Why does this matter? It’s a hidden weapon in the GME saga. Let’s break it down.

The Arbitrage Mechanism: A Hedge Fund’s Dream Play

Convertible arbitrage is a strategy hedge funds love: 1. Buy the bond (low-risk debt with conversion upside) 2. Short the stock (hedge against downside) 3. Pocket the spread from short decay and bond premiums

This creates a synthetic short with built-in protection—but it’s fragile.

⸻

VWAP Triggers and the Volatility Trap

The bonds tie into VWAP (Volume Weighted Average Price) thresholds.

If GME’s VWAP spikes above the strikes ($28.91 and $29.85) for ~20 trading days, funds face a tough choice: • Convert bonds → Now they hold shares instead of bonds • Buy back shorts → Cover exposure and unwind the hedge • Hold and risk it → Face massive dilution if the stock runs

While GME stays pinned below $28–29: • Implied Volatility (IV) drops • Call options become extremely cheap • Shorts reload downside bets with ease • Retail traders are lulled into complacency

This is the trapdoor.

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The Reversal: When the Trap Springs Shut

Once GME crosses both thresholds, everything flips: • Put volume evaporates • Call volume surges, triggering gamma ramps • Market makers scramble to delta hedge upward • Synthetic shorts begin to unwind rapidly

The hedge becomes rocket fuel for a rally. No more suppression—only forced buying.

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Watch the Timing: Q3 2025 Is Prime Time

Based on issuance dates and mechanics: • Q3 2025 is the hotspot for a potential flip • Sustained VWAP above strikes = dominoes fall • DRS (Direct Registration) pressure removes borrowable shares • Shorts scramble to close or convert

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The Key Players: Point72, Convertible Funds, and Ryan Cohen • Point72 (Steve Cohen): Holds 1.3 million GME puts vs. just 50,000 calls (Q1 2025 13F) • At first glance, this appears to be a bearish position • But this is classic synthetic short coverage — a common structure for convertible bond buyers • These puts hedge the bond’s equity exposure until VWAP thresholds are met

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Why Point72 May Be Bullish — Quietly

While the position looks bearish on paper, Point72’s strategy could flip aggressively once the VWAP triggers activate. Here’s how: • Their bond position gives them first-in-line access to discounted equity • If GME crosses the conversion threshold, Point72 can convert bonds into stock, immediately flipping from short to long • Their puts protect them on the downside, but become expendable if the upside unlocks • By covering their short and converting, Point72 can participate in the upside — without slippage — and dump puts into rising IV for profit

This is the real play: absorb volatility early, flip sentiment late, and ride the upside after retail does the legwork. Quiet accumulation until the ignition point.

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Scenario Simulation: The Flip and the Fuel

Imagine GME blasts past $30: • IV skyrockets • Call volume crushes puts (3:1 ratio or more) • Funds must: Buy back shorts, convert bonds, or exit entirely

Each action triggers more upside pressure. This isn’t a rally—it’s a reversal of structure. Synthetic shorts become long exposure.

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Conclusion: A Weaponized Balance Sheet

GameStop’s 0% convertibles aren’t just a way to raise cash. They’re strategic weapons: • Lure in arbitrage shorts • Amplify pressure via DRS and M&A catalysts • Build time bombs around VWAP levels • Let volatility and trapped liquidity ignite the reversal

Point72 isn’t just hedging. They’re waiting. And if the setup plays out, what starts as protection becomes opportunity.

GME #ConvertibleBonds #Point72 #SyntheticShort #VWAP #RyanCohen

Doubled down before the next move up. Couldn’t stay on the sidelines with all the institutional FOMO building.

Picked up 100 more GME shares and added more Oct 17 $25 calls.

Total shares: 1,101
Total calls: 11x $25 Oct 17s

Let’s see what RC has planned

Current channel we've been in since the obnoxious drop happens to align with GME's mean trend lines going back to 2003. Has anybody else noticed this? Seems like the perfect launchpad for the next move upwards.

SOURCE: https://www.linkedin.com/posts/larrycheng_there-are-two-types-of-deals-in-growth-equity-activity-7366807733414576128-3Q2a

TRANSCRIPT:

”

There are some companies that all the growth equity firms know about and all the venture firms know about, and everyone's competing, and it's in the hottest sector, and that's going to be priced really high.

But then there's definitely companies on the other end of the spectrum where we're the first investor they've ever talked to and they've ever met.

And maybe they're in a sector or a geography that or business model that is not hot, but they built a really nice business.

And you know, we're not looking to check every single box. We're willing to take some risk on certain things and be contrarian within our focus area.

And sometimes that leads us to less competitive opportunities where at this stage we would value them usually on some sort of revenue multiple. 👀🌶️🥩🎱#1

" [End Transcript]

POST BODY:

"

There are two types of deals in growth equity right now.

The first type: every firm knows about them, everyone's bidding, and the valuations are insane.

The second type: we're literally the first investor they've ever talked to.

And if there's something I've learned in my 25+ years as an investor, it's that you've got to be a little bit contrarian to spot the best opportunities… 👀🌶️🥩🎱#2

”

$GME FTW

got that tingly feeling in my weenie. Bought in today and might scale some out just before ER if we get a run up. I think the rise in BTC and the release of the switch 2 eill help. Or it wont and im fucked. GME

Anyone else wanna join me on their weekly GME update of positions? Im only able to add a couple of shares a week. Im hoping to get to atleast 1k before it hits 5000000 a share. How about everyone else??

GME and Ryan Cohen have played a master chess game and for any shorts, possibly even shorted legally. I don’t feel bad for them if they can’t see through everything that is out there to understand what they’ve gotten themselves into.

Gme gme gme gme gme gme gme gme gme gme gme gme gme gme gme gme gme fuck the shorts gme gme gme gme gme gme gme gme gme gme gme gme gme daddy cohen gme gme gme gme gme gme gme kitty roaring gme gme gme gme gme gme gme gme gme

Over the last quarter or so, we are told institutions have "doubled" the number of shares they hold. Where do these shares come from? Yea, I understand life gets in the way sometimes and a few people have paper hands, but 20 percent increase is over 80,000,000 shares! Insiders and Ryan Cohen haven't sold (except to cover taxes) and apes just keep buying! So where do these shares come from? Synthetic or borrowed? I'm pretty smooth but doesn't this indicate shorts are f*ucked?

Gamestop 🚀. House price go zoom during COVID, now go crash back. Big up, now big down. All gain gone, back to start. Housing chart do full round trip. Sound like rocket ship to me, whoooosh! 🚀 I like chicken tenddies.

Posted 8 mins ago.... Invesco Ltd. increased its stake in GameStop Corp. by 12.3%, owning 657,703 shares valued at approximately $14.68 million. Several institutional investors have significantly increased their holdings in GameStop, with D. E. Shaw & Co. Inc. raising its stake by 606.7% in the last quarter. GameStop received a "strong sell" rating from Wedbush, with analysts giving it a consensus rating of "Sell" and an average price target of $13.50.

So let me get this straight:

GameStop has a current Market Cap of $9.98 Billion.

To see what Wall Street "believes" the core operating value (not EV or book value) of the underlying business is, we’ll subtract GameStop's cash, cash equivalents, and proceeds raised from the 0% interest senior convertible notes:

🔮🔮🔮🔮🔮🔮🔮

$9.98 Billion Market Cap

-

$6.42 Billion Cash & Cash Equivalents

-

$3.53 Billion Funds from Senior Convertible Notes

=

$30 Million Core Operating Value

🔮🔮🔮🔮🔮🔮🔮

$30. Million. Dollars.

And this is all while GameStop is AVERAGING a net profit of $52 Million per quarter for the last 4 CONSECUTIVE quarters, Q2 2024-Q1 2025.

A certain Ken Griffin quote comes to mind: "Markets are efficient because of active managers setting the prices of securities. Firms like Citadel, firms like Fidelity, firms like Viking Global, Capital Research. We're all running large teams of people that are engaged in fundamental research trying to drive the value of companies towards where we think they should be valued."

When we say the price of $GME could not be more fake, what we mean is: The Price Is Wrong, BITCH.

TIME AND PRESSURE

P.S. If they're being honest (they aren't), even the most anti-GameStop shills should blush at this insanity (they won't).

🫡

So we all know the price is fake. The liquidity is low and the crime is high. Now forget the SI from January 21, the hidden swaps, offshore accounts in Brazil, darkpool etc.

Gamestop isn't fair valued so from everything you know dear ape, where would you value a company like Gamestop (or in this case Gamestop just with another name) with the share price?

I think imo if the company wasn't GME but another small/big company being profitable with this much potential it would be at least valued at 80-150$ per share. What do you think?

GameStop has changed their earnings date to 9-9-25 and this could only mean one thing. We got 99 problems but revenue ain’t one. They are estimating.17 cents a share. We will nearly double that if past trends prove true. I’m calling it .33 per share. Added 62 more at end of day. Nice dip!