Point72 suffered a loss of almost 15% this year – thanks to the sharp increase in the company’s shares GameStop Corporation (NYSE: GME), a person familiar with the matter told the New York Times.
What happened: The hedge fund managed by Steve Cohen – the owner of the New York Mets – suffered losses due to its investment in Melvin Capital, another fund that bets against the shares of the game retailer, the Times reported on Wednesday.
Cohen was asked on Twitter whether the losses would affect the Mets.
Why would one have something to do with the other
– Steven Cohen (@ StevenACohen2) January 27, 2021
Why it matters: On Monday, Point72 – which had already invested $ 1 billion in Melvin by 2019 – injected $ 750 million more into the besieged fund, while the Citadel hedge fund invested $ 2 billion.
Short sellers Melvin and Citron Research covered their short sales against a wave of retail investors spurred on by the subreddit r / WallStreetbets.
See too: GameStop Investor Michael Burry – ‘The Big Short’ Fame – Dubs Rally ‘Unnatural, Insane, And Dangerous’
“People just want to buy the stock, without even thinking about the deal,” said Andrew Left of Citron Research.
GameStop’s shares have increased 685% so far this year. AMC Entertainment Holdings Inc (NYSE: AMC), another action targeted by Reddit investors, soared more than 804%.
Price action: GameStop shares closed almost 134.8% higher at $ 347.51 on Wednesday and fell 15.97% to $ 292 in the after-hours session.
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