Did melvin close shorts

His tweet garnered some 26,000 likes.

Shares soared by nearly 140% in after-hours trading. The stock opened on Jan. 27 at a whopping $354.83 a share.

Jan. 27, 2021: Major short sellers close — at a significant loss

Citron Capital and Melvin Capital, two firms shorting GameStop stock that were referenced heavily in the r/wallstreetbets forum, said on Tuesday that they were closing their positions.

Left of Citron Research made the announcement in a YouTube video, saying Citron Capital let go of the majority of their bets that GameStop stock would fall and took a “100%” loss in doing so.

“This has captured the attention of America and every trader and non-trader alike,” Left said.

Did melvin close shorts

As the pandemic forced people to stay home and trading apps that let users enter the market without the need of brokers or money managers rose in popularity, the forum garnered hordes of new followers during the March 2020 stock market dip and subsequent rally. On Jan. 27, the group had some 3 million members. By Feb.

3, it had more than 8 million.

Here is a timeline of how the GameStop saga unfolded.

Dec. 8, 2020: GameStop reports dismal earnings, stock takes a tumble

In early December, GameStop reported that net sales plummeted in the third quarter of its fiscal year 2020, down more than 30% compared to the same time period in 2019.

Did melvin close their short position

Ted Cruz, R-Texas, said that he agreed with her — though they didn’t end up agreeing to work together.

Jan. 29, 2021: SEC weighs in, trading platforms re-allow most GME transactions

The U.S. Securities and Exchange Commission on Jan. 29 issued a statement saying it is “closely monitoring and evaluating the extreme price volatility of certain stocks’ trading prices over the past several days.”

The SEC’s statement, however, did not mention any stocks, social media platforms or trading platforms by name, but said the agency “will act to protect retail investors when the facts demonstrate abusive or manipulative trading activity that is prohibited by the federal securities laws.”

“Market participants should be careful to avoid such activity,” the statement added.

Did melvin capital close their shorts

Grube was the formerly the chief financial officer at Chewy, among other executive roles in the e-commerce space.

“We are excited to bring our customer-obsessed mindset and technology experience to GameStop and its strategic assets,” Cohen said in a statement at the time. “We believe the Company can enhance stockholder value by expanding the ways in which it delights customers and by becoming the ultimate destination for gamers. Alan, Jim and I are committed to working alongside our fellow directors and the management team to continue to transform GameStop.”

The announcement sparked some initial chatter on the Reddit page r/wallstreetbets.

Jan 13, 2021: Stock surges more than 50%

Some retail traders jumped on GameStop’s announcement, and in just a few days the stock closed at $31.40 a share on Jan.
13 — a spike of more than 50% since the Jan.

Gill and other members of the forum also cited the bullish GameStop stance of Michael Burry, the legendary trader who was portrayed by Christian Bale in the 2015 film “The Big Short,” as fuel for their investment choices.

Gill did not immediately respond to ABC News’ request for comment, though he told the Wall Street Journal last week that he “didn’t expect this.”

Ciamac Moallemi, a professor at Columbia University’s business school, told ABC News that Burry and Cohen fueled a “small” but growing group that “believed the market was discounting GameStop too much, and that there was some underlying value there and that the business could be turned around.”

“That was part of the driver,” Moallemi said of GameStop’s stock’s meteoric rise.

Closing out those puts during the quarter may have been unfortunate timing, as two of those put options were on stocks that collapsed during the late March liquidation of positions held by Bill Hwang’s Archegos Capital Management.

Two of the most notable Archegos liquidations were of GSX Techedu and ViacomCBS, which fell 67 percent and 30 percent in March, respectively.

Both had soared during the January Reddit frenzy, and during the quarter, Melvin sold all of its puts in both names. Melvin sold puts on 750,000 shares of GSX and those on 3.26 million ViacomCBS shares.

Melvin reportedly lost 7 percent in March, and was down 49 percent during the first quarter.
It fell 54.4 percent in January, according to a letter to investors seen by Institutional Investor.

“It was not because we wanted to stop people from buying these stocks,” Robinhood wrote in a company blogpost. “We did this because the required amount we had to deposit with the clearinghouse was so large — with individual volatile securities accounting for hundreds of millions of dollars in deposit requirements — that we had to take steps to limit buying in those volatile securities to ensure we could comfortably meet our requirements.”

The move sparked immediate backlash and also triggered an extremely volatile trading day — that saw shares reach their intraday peak of $483.00 — before plunging down to $112.25 by the time markets closed.

Lawmakers and political figures on both sides of the aisle soon weighed in. Rep. Alexandria Ocasio-Cortez, D-N.Y., called the restrictions on GameStop “unacceptable” in a tweet.

GameStop stock opened some 50% down at $140.76 a share.

Vanderbilt professor White told ABC News that this “David versus Goliath” saga “reflects a lot in our society” amid a pandemic that has exacerbated income inequality.

Still, he expressed worry about what comes next — and how GameStop falling will ultimately impact these individual investors and faith in the stock market at large.

“We expect that eventually GameStop stock price will come down and some people will lose money when that happens for sure,” he said. “And my fear is that they’ll view the stock market as being rigged and not being fair, and that they won’t invest in the stock market.”

Feb. 4, 2021: Janet Yellen meets with regulators

Treasury Secretary Janet Yellen publicly addressed the saga during an interview with “Good Morning America” on Feb.

Many link the initial push in r/wallstreetbets toward GameStop to an individual investor identified by the Wall Street Journal as Keith Gill, but known on Reddit by his screen name “DeepF***ingValue” or “DFV” for short.

Gill publicly touted GameStop stock long before it caught the eyes of Wall Street and the world. In a July 27, 2020, YouTube video posted to his channel, Gill said, “Some people won’t even tune into the stream right now when they hear I’m bullish on GameStop, at the current price point it’s traded at about four bucks right now.”

Gill also posted screenshots of his GameStop portfolio on r/wallstreetbets as far back as 2019.

He added that he respects the market and has “respect for the people on the Wall Street Bets and on Reddit message boards.”

The manager of hedge fund Melvin Capital also on Wednesday admitted to CNBC that the fund was letting go of its GameStop shorts. Sources familiar with Melvin Capital confirmed to ABC News that the hedge fund lost 53% of its total investments in January.

28, 2021: Robinhood and other platforms restrict transactions for GME, lawmakers react

The saga took an unexpected turn on Jan. 28 when retail trading platforms including Robinhood and TD Ameritrade abruptly restricted most transactions involving GameStop stock. TD Ameritrade said this was “in the interest of mitigating risk”.

Leave a Reply

Your email address will not be published.