Hedge funds Citadel, Point72 putting $2.75B in Melvin Capital, hit by GameStop short
Jan. 25, 2021 3:26 PM ET GameStop Corp. (GME) By: Kim Khan, SA News Editor 112 Comments
Ken Griffin's Citadel and Steve Cohen's Point72 Asset Management are investing $2.75B into Melvin Capital to help stabilize the fund that has ben hammered by bad short bets this year, The Wall Street Journal reports.
Melvin Capital's short positions, including against GameStop ( GME, +14.4%), have contributed to losses of 30% through Friday, the Journal says.
GameStop has soared as retail investors, and particularly Reddit users, have piled into the stock to take on the shorts, including Citron. The stock, which has short interest of 150%, was up as much 144% today, but also saw periods in the red.
Citadel is investing $2B and Point72, which already has $1B in Melvin, is investing $750M, both for non-controlling revenue shares.
GameStop has also had on outsize influence on ETFs that, before the rally, had relatively small allocations in the stock. |
