A number of high-profile hedge funds have already lost more than $5 billion so far this month, according to data from the financial-analytics firm S3 Partners. A US hedge fund that made 700m from betting on consoles retailer GameStop has continued its strong run through well-timed positions in soaring energy and technology stocks. The higher the stock went, the greater the losses incurred by those that had previously bet against any price rises, as they were then forced to buy those shares back, whatever the cost. Hedge fund that won on GameStop extends gains to 1. Members have spent the past three weeks bidding up GameStop, which has sent the shares skyrocketed more than 1,200% since Wall Street Bets first piled in on January 11. GameStop's shares have hit record highs and the swarm of retail investors behind the rally have cheered each other on, primarily within the popular Reddit forum Wall Street Bets, which by Thursday, had around 3.5 million members. In the week following GameStop’s reaching its peak share price, around 36 billion of value was wiped off of its. Candlestick Capital Management A trader reacts as he works on the. On the 29 th, data from fintech company S3 Partners showed that short-selling hedge funds had suffered a year-to-date market-to-market loss in GameStop of 19.75 billion. The 3.5 billion hedge fund had bet against GameStop using put options contracts which let investors bet a stock price will fall. White House press secretary Jen Psaki said Wednesday. Michael Burry, the hedge fund investor who built a massive position in GameStop before it became a meme stock on Reddit and skyrocketed, sold his entire stake in late 2020. This fund from Dallas, Texas has 3.8 billion of assets under management and started to bet against GameStop stock as recently as Q3 of the current year. (NYSE:GME) At Q2's end, a total of 27 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 0 from one quarter earlier. “To have a healthy stock market, you’ve got to have a cop on the beat.Video-game retailer GameStop has dominated the headlines this week after its shares trebled in value in just three days this week, in a buying frenzy fueled by individual traders that have forced some of Wall Street's prominent hedge funds to close their bearish bets against the company with hefty losses. For those short-selling hedge funds, the losses mounted up. On Wednesday alone, investors who took short positions in GameStop lost an estimated 14.3 billion. How are hedge funds trading GameStop Corp. Elizabeth Warren, D-Mass., told CNBC Wednesday. Melvin Capital, the hedge fund run by Gabe Plotkin that struggled with heavy losses last year as it reeled from wrong-way bets on GameStop, is shutting down, according to a letter sent. “We need an SEC that has clear rules about market manipulation and then has the backbone to get in and enforce those rules,” Sen. The meteoric rise in GameStop’s shares has prompted some lawmakers to call on regulatory bodies to intervene. Melvin Capital, which met the ire of retail traders due to a publicly disclosed put position on the video-game retailer, posted losses of 39 percent in 2021, according to a person with knowledge. But GameStop had 140 per cent of its freeflow shorted from a hedge fund point of view, that’s not very smart. Generally speaking, hedge funds have been long TMTs and short consumer. Robinhood said in a blog post that the central Wall Street clearinghouse mandated a tenfold increase in the firm’s deposit requirements on the week in order to ensure smooth settlement in trades involving the securities experiencing unprecedented volatility. Anecdotally, hedge funds’ positioning has become ever more concentrated in recent years, the manager told Hedgeweek.
The forum has seen its members more than triple in just a week to north of 7 million.Īmid the short squeeze, Robinhood and other brokerages restricted trading in some of the most volatile names, sparking frustration for users who were unable to trade at will. Last week’s activity in GameStop extended to other popular short targets, including Bed Bath & Beyond and AMC Entertainment, with retail investors turning to Reddit’s WallStreetBets forum to discuss various trades. The Wall Street Journal first reported Melvin’s January losses. economy closes out 2020 with lower than expected 4% gain
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