Must Asset Management, which held a 4.7% stake in GameStop Corp. GME until April last year at least, is turning less bullish on the stock in light of the latest confounding rally.
What Happened: Must Asset Management CEO Kim Doo-yong told Bloomberg on Monday that the South Korean hedge fund had turned “less bullish” and “more neutral” on GameStop.
According to Kim, GME “stock will continue to be very volatile and unpredictable in the short term.”
The 4.7% stake made Must Asset Management one of the largest GameStop investors, as per Bloomberg. Whether the hedge fund has maintained its stake isn’t clear and Kim refused to comment to Bloomberg.
Kim said the fund is still positive on the management changes at the video game retailer and believes Chewy Inc. CHWY co-founder Ryan Cohen can repeat the success seen at the online pet food retailer.
Why It Matters: GameStop shares surged 51% on Friday to close at $65.01.
The massive surge is said to be particularly driven by online communities of speculative traders, in particular Reddit’s WallStreetBets subreddit.
The WallStreetBets Reddit community likely resorted to a “pump-and-dump” trading scheme in the aftermath of Citron Research’s Andrew Left, a notorious short seller, giving a $20 price target on GME and explaining his bear case.
Price Action: GameStop rally continued in the pre-market session on Monday, with shares trading 46% higher at $95 at press time.
Photo courtesy: EPIC via Wikimedia
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