The insane and dramatic chaos of GameStop’s actions may have cost NBA legend Michael Jordan half a billion dollars, reducing his net worth significantly.
NBA legend Michael Jordan may have lost half a billion dollars in the great GameStop saga. The iconic former Chicago Bulls player doesn’t have to worry about money thanks to his brand partnerships, a successful basketball career and more, but losing $ 500 million thanks to bets against GameStop is not something you can get rid of easily. .
The GameStop saga was a high-risk saga for almost everyone involved. While it potentially saved GameStop from bankruptcy, volatility was deadly for any investor. GameStop’s stock skyrocketed from a mere $ 20 in early 2021 to nearly $ 500 at its historic peak, a record for the struggling retailer. The sudden jump from two digits to three digits high was triggered when Reddit users noticed that GameStop was one of the best-selling stocks, meaning that hedge funds were betting on his death. The Reddit army, along with many other ordinary people with some money to burn, realized that they could cause the stock to skyrocket by investing heavily in it, all until hedge funds covered their sales, which would cause them to increase even more.
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GameStop’s shares eventually collapsed, but it still took some casualties, potentially the great Michael Jordan among them (via Chicago Sun Times) Jordan’s net worth was previously valued at $ 2.1 billion in April 2020, but Forbes is reporting that its net worth has dropped to $ 1.6 billion. The basketball icon now owns the Charlotte Hornets and, two years ago, sold a minority stake to Gabe Plotkin, founder of Melvin Capital. Melvin Capital was one of the hedge funds that sold GameStop and was seriously injured, demanding billions in cash for the consequences. It has not been confirmed that this is the cause of the huge drop in Jordan’s equity, but it is widely speculated as a factor.
Michael Jordan is still a billionaire, so he’ll be fine, but a $ 500 million loss is nothing to scoff at. GameStop plans to transition to an e-commerce business model and these new plans have caused the retailer’s stock to skyrocket again. Whether this will pay off or not, in the long run, has yet to be seen. Regardless, retail investors are likely to continue to defend hedge funds against fire for a while.
GameStop he is expected to live to fight another day while Chewy.com founder Ryan Cohen helps lead the charge in a new era for the retailer. Unfortunately, this meant the loss of key board members, like Reggie Fils-Aime, in the process, but it is a loss that may need to occur to keep the game retailer afloat. Only time will tell how successful it can be and whether it can go toe-to-toe with other e-commerce platforms like Amazon. For the time being, however, it appears to have pulled a piece of a giant out of the wood.
Source: Chicago Sun Times, Forbes
