Melvin Capital is giving the Reddit crowd something to cheer on Friday.
The hedge fund, which is seen as the testament to Wall Street’s worst for a group of individual investors, fell 49% in the first quarter, according to a report from Bloomberg News on Friday.
Melvin Capital has been at the center of a closely watched competition between professional investors and amateur traders gathered on social networking forums like Reddit’s r / WallStreetBets.
The hedge fund, run by Gabe Plotkin, the former chief investment officer of investment giant Steve Cohen, has burdened the burden of losses due to the proliferation of missing “meme” stocks as much as retailers. GameStop video game
and the film series AMC Entertainment Holdings
and it seems that Melvin’s narrow inner wounds have not healed, perhaps to Plotkin’s disappointment and the delight of the army of amateurs who are determined to align it with benefits. general.
“51% left!” posted a user on r / WallStreetBets in response to Melvin’s reported losses.
A spokesperson for Melvin Capital declined to comment on the Bloomberg report to MarketWatch. However, a person familiar with Melvin’s record confirmed the magnitude of the quarterly loss.
Reports of deeper pain for Plotkin come after his fund plummeted 53% in January. thanks to an unprecedented short squeeze designed by retail traders who have targeted the fund using social media like Reddit and Discord and free trading platforms fees like Robinhood to increase share value in GameStop and AMC.
However, Plotkin managed to return 22% to investors in February but Bloomberg reported that the fund fell 7% last month.
Melvin Capital is said to be holding a large short position in GameStop, helping to drive the retail crowd’s original strategy. Some Redditors accuse hedge fund investors, such as Plotkin and Co., of benefiting from financial markets that some consider fraudulent.
Melvin’s loss is being hailed by others as “pornography of the ultimate loss”, on some topics, with “loss pornography” representing a way of depicting disdain of the Reddit crowd.
Several users on Reddit have speculated, with no evidence, of the possibility that Melvin is still trapped in the GameStop control game. However, recent reports suggest that is unlikely.
A fund spokesperson stated that Plotkin introduced his GameStop short on January 26, the day after the fund received the much-needed $ 3 billion from Plotkin’s mentor, Point72’s Steve Cohen, and his former boss, Ken Griffin of the Citadel.
Shares of GameStop fell 7% on Friday and lost more than 17%. However, as of now, the stock of this video game retailer has increased by more than 740%. For comparison, the Dow Jones industrial average
has risen more than 10% so far in 2021, the S&P 500 index
There was also a similar increase in the price of bitcoin
increase more than 100% over the same period.
However, the retail group seems pleased with the hedge fund investor’s grief, with one arguing that investing in Melvin “seems like a great way to turn a million dollars into hundreds of thousands. dollars ”.