Melvin Backer Point72 Suffers 15% Loss Over GameStop Short Squeeze: NYT

Melvin Backer Point72 Suffers 15% Loss Over GameStop Short Squeeze: NYT

Point72 has suffered a loss amounting to nearly 15% this year — thanks to the sharp uptick in the shares of GameStop Corporation GME, a person familiar with the matter told the New York Times. 

What Happened: The hedge fund run by Steve Cohen — the owner of New York Mets — suffered the losses due to its investment in Melvin Capital, another fund that bet against the gaming retailer’s stock, the Times reported Wednesday.

See Also: How‌ ‌to‌ ‌Buy‌ ‌Gamestop‌ ‌(GME)‌ ‌Stock‌

Cohen was asked on Twitter if the losses would affect the Mets.

Why It Matters: On Monday, Point72 — which had already invested $1 billion in Melvin, as of 2019  — infused $750 million more into the beleaguered fund, while the hedge fund Citadel invested $2 billion.

Short sellers Melvin and Citron Research covered their shorts against a wave of retail investors spurred by the subreddit r/WallStreetbets.

See Also: GameStop Investor Michael Burry — Of 'The Big Short' Fame — Dubs Rally 'Unnatural, Insane, And Dangerous'

“People just want to buy the stock without even thinking about the business,” said Citron Research’s Andrew Left.

GameStop shares have spiked 685% so far this year. AMC Entertainment Holdings Inc  AMC, another share targeted by the Reddit investors, has shot up over 804%.

Price Action: GameStop shares closed almost 134.8% higher at $347.51 on Wednesday and fell 15.97% to $292 in the after-hours session.

Posted In: Andrew LeftCitron ResearchMelvin CapitalPoint72RedditShort SqueezeSteve CohenThe New York TimeswallstreetbetsNewsShort SellersHedge FundsEventsMediaGeneral