NorthWest Biotherapeutics Inc (NWBO)

[Chiugray]

Barnstormer, Thanks for sharing that info. I just want to clarify something the AI said.

True: an institutional/hedge fund’s leverage is not “unlimited” and the market maker has a hard limit on leverage depending on the counterparty risk.

But: For a retail investor who thinks of leverage in terms of a standard 2:1 margin / leverage, that is an understatement. Technically "limited" could mean a practical leverage of 10X or 50X. We don’t know because it is a black box, where the actual leverage and margin deposit is a private negotiation between the client and the Market Maker.

My gut tells me that any hard limits are countered by a MMs risk appetite. But apparently generating derivative/synthetic contracts are very profitable. MMs make money on the creation of the synthetic contract (a set of put and call options) and a lot more money by assuming the risk by being on the other side of these contracts.

If using GME as an analogy: the exposure started off practically “unlimited” and becomes “limited” during the short squeeze by margin calls and collateral constraint mechanisms.