The GameStop Saga Takes Down Another Hedge Fund – CNET
Amateur traders rocked Wall Street when they united on Reddit and sent out the worth of GameStop shares to the moon That was more than a year back, however the fallout isn’t rather over right now.
Melvin Capital Management, a hedge fund led by Gabe Plotkin, is closing its doors. The fund was supposedly not able to recuperate from the damage it took throughout the 2021 GameStop brief capture. Plotkin’s choice was revealed to customers on Wednesday in a letter, according to Bloomberg. Melvin Capital decreased to comment.
Plotkin’s hedge fund was among the biggest victim’s of the GameStop and AMC meme stock mania. (A meme stock is any stock that’s gone “viral” on social networks, and whose worth increases as an outcome). The fund began 2021 in a strong position with more than $12 billion in money in January, it published a 53% lost that very same month following the subreddit r/wallstreetbets’s attack.
” The past 17 months has actually been an exceptionally attempting time for the company and you, our financiers,” Plotkin composed in the letter to his customers, according to Bloomberg. “I have actually provided whatever I could, however more just recently that has actually not sufficed to provide the returns you need to anticipate. I now acknowledge that I require to step far from handling external capital.”