This one is kinda funny because it's so absurd, and also anyone with 32k to invest in the first place can't be doing that badly. However, it's fucked up how gambling on your phone, sports and crypto as well as stocks, has just been completely normalized over the last couple of years.
This also might be a glitch (the number looks suspiciously close to the 32 bit max). But in that case it's fucked up how people's live are so controlled by completely unaccountable tech companies who don't provide support unless you're a corporate customer with millions of dollars in monthly spending.
They aren't investing, they are trying to win the lottery by buying very risky tickets.
The only reason it's that high is that they need to sell their long shares. They'll still lose money but not $4M. Right now they're on the hook because an options contract is for 100 shares. They bought SPY options (S&P 500 index fund) which is around $400. Sounds like they bought around 100 contracts. The rest is the $10k they added to cover their loss and the odd dollar amount of the stock price.
When your options expire or become worth very little, the broker will exercise the contract on your behalf. If you buy 100 puts (short/sell/bet that it'll go down) and the stock goes up too much, they'll make you buy 100 shares per contract. That's what a margin call is. The person bought a bunch of options on margin, RH doesn't want to be on the hook for it (no broker would) and so they made the person buy the actual shares. If they sell at opening, that'll set them right. Well, as right as they can be. They'll still lose thousands.
Nobody starting out should touch options. They are dangerous. RH is predatory about them. They are very lax in their requirements for trading and will give you margin when they shouldn't. This is because RH makes money when you blow up your account. I wouldn't be surprised if we find out a lot of the meme stock craze was guerilla marketing by these shady fintech companies to drive users.
If you invest thirty flobits in to a package deal of a hand chosen market basket of charmions and then invert the dynamic Merovingian portfolio you can redress a number of turbo-regressive sublingual distension properties and double or even triple your hydrodynamic flow!
Exactly.
It's also why naked shorts is freaking dangerous compared to just buying a straight put from someone to sell (yes you increase your profit possibility with a naked put but also you have high loss risk as well).
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