<p>When I first entered the stock market, I had the same naive thoughts as you. In reality, institutions don't lose money because they hedge using options for protection. The ones who lose are the naive investors. In such cases, the lower and faster the price is pushed, the more beneficial it is for the institutions, as the value of the options increases. Therefore, once the short interest is covered, the price is violently and directly driven up, while the institutions pick up the chips handed over by naive investors at low prices.</p>

<p>When I first entered the stock market, I had the same naive thoughts as you. In reality, institutions don't lose money because they hedge using options. The ones who lose are retail investors. In such cases, the lower and faster the price is pushed, the more beneficial it is for institutions, as the value of the options increases. So when short positions are covered, the price often surges violently, and institutions pick up the chips handed over by retail investors at low prices.</p>

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