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Why are hedge funds losing money on GameStop?
The hedge fund made the losses in this year’s first so-called meme-stock rally, in January, but later recovered much of that lost ground, the newspaper said. It said the decision to shut the fund resulted from a review of White Square’s business model, rather than from the GameStop rally.
How much will hedge funds lose on GameStop?
The hedge fund that lost more than 50\% on GameStop’s stock surge is facing 9 lawsuits from retail investors alleging conspiracy to restrict trading. Melvin Capital is facing nine lawsuits from retail investors who alleged a conspiracy to limit trading caused them to lose money.
How do hedge funds drive a stock down?
Hedge funds have an incredible supply of short shares available to borrow. This advantage has allowed them to manipulate a stock’s share price by initiating short-ladder attacks. While supply and demand are pushing a stock’s price up, hedge funds short the stock using an insane amount of leverage.
Who lost the most money on GameStop?
Two big hedge funds, Melvin Capital and Citron Research, are thought to have been the most exposed. The former is believed to have lost around 30\% of its $12.5 billion under management already this year on a series of shorts, which includes GameStop.
Did hedge funds lose money on GME?
Hedge fund Melvin Capital Management lost 53\% in January amid a record rally in GameStop, which the fund was betting against. The heavy losses comes as retail investors piled into popular hedge fund short targets, including the struggling video game retailer.
Did hedge funds buy GME?
Richard Mashaal and Brian Gonick started buying GameStop Corp. GME -0.51\% shares in September. They aren’t Reddit day traders or Discord users. They are hedge-fund managers in New York.
Is Melvin Capital losing money?
Melvin Capital Management, which lost more than $6 billion in January, is now down 46\% for the year through June, the fund recently told investors. Maplelane Capital is down 39\% for the period.
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