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Gamestop hedge fund8/3/2023 ![]() This story has been published from a wire agency feed without modifications to the text. A new wave of Reddit users has pushed the shares back up to their highest level since early February, closing at $132.35 on Thursday. GameStop closed as high as $347.51 in late January as frenetic buying created a short squeeze, then plunged to below $41 on Feb. during the fourth quarter, according to last month’s 13F filing. ![]() Meanwhile, the fund took a 1.4% position in Flagstar Bancorp Inc. and DSP Group Inc., according to Bloomberg data. Senvest has stakes in Tower Semiconductor Ltd. Steve Bruce, an outside spokesman for Senvest, declined to comment. The company’s New York-based money management unit was founded in 1997 and manages more than $3 billion in assets as of March 1, with a strategy of “contrarian, value-based" investing, according to its website. Richard Mashaal and his father Victor Mashaal collectively own about 55% of Senvest Capital, according to the latest filings. Senvest Capital’s Toronto-listed stock has risen over 76% this year to about C$307, trading near a record high. It is a sharp contrast to what is happening in our country where technology is being used to launch surveillance on the citizens, which stifles democracy and disempowers the people.Senvest Capital, which seeded fund manager Senvest Management and shares in the revenue from it, was used by some investors as another way to play the GameStop phenomenon. Meanwhile, the bad news on the economy continued. This drew strong criticism from across the political spectrum – I have never before seen Republican Senator Ted Cruz agree on any topic with Democratic Representative Alexandria Ocasio-Cortez, that too without any debate or discussion!įor me, this is a good example of how technology, when used effectively, can help take the power into the hands of the people – it can be leveraged to deepen democracy and people’s participation in decision-making. Day traders took on the hedge funds over GameStopand rattled the big guys, Wall Street and Congress. Ironically because Robinhood took from the rich and gave it to the poor! It seemed like the “free market” was suddenly too free for these platforms, and they wanted some self-regulation to reign in this ‘free for all’. Some have called this the David and Goliath story, others decided to have a laugh at the expense of the hedge fund moguls but one of the most popular trading apps, Robinhood, ironically decided to crash the party by blocking buying of GameStop stocks (and a few others). Free trading apps (like Robinhood) which are used by amateur investors for trading on the stock market. Reddit (specifically the chat room WallStreetBets) provided the forum for the retail investors to discuss and coordinate the action, so that together they had enough funds to match the deep pockets of the hedge funds. This was facilitated by two tech platforms in particular. Led by Keith Gill, they started buying the stock resulting in an increase in its value on the exchange, causing a short squeeze for the Hedge Funds and losses in billions of dollars.įor me, the main takeaway is how technology has allowed retail investors to do what hedge funds have been doing for years – legally manipulate the stocks to make millions of dollars at the expense of others. Members of a popular community on Reddit dedicated to the stock market for retail (individual) investors, called WallStreetBets, found out about this. A few Hedge Funds, including Citron Research and Melvin Capital, saw an opportunity and decided to short the company’s stock to make money. GameStop is a brick-and-mortar enterprise which was already losing market share to online stores and the pandemic hurt them further. Not least of all the wealthy who, some would say, are whining that this form of “free market” is against the wealthy!Ī simple search on the internet will provide multiple articles explaining what happened like this one by Huffpost. Now, Citadel is taking some of its money back. ![]() So when it did happen last week at the New York Stock Exchange, everyone sat up and took notice. The hedge fund Citadel pumped billions of dollars into Melvin Capital after that fund’s bet against GameStop went bad, leading to huge losses. How often do we read about middle income individuals appropriating the wealth from the super-rich using the very systems that they have created in order to become and stay wealthy? Not very. ![]()
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