The Reddit users were able to discover Melvin Capital’s short against GameStop because it was expressed in listed put options. “They are the stock version of insurrectionists.” “They made it their f- life mission to take him out,” said one hedge fund manager who is also a short seller and has been watching the Reddit forums on Melvin for months. “Here’s the next play after GameStop to f- Melvin Capital even more,” wrote a WallStreetBets user ten days ago, referring to the specialty retailer.

More Reddit posts and videos about Melvin Capital have been posted since then, and the Reddit users even started mentioning other stocks Melvin Capital was shorting, like Bed Bath and Beyond. The clip concluded with a photo of an explosion with the words “Melvin Capital” splashed across it. Cohen’s successor firm Point72 had more than $1 billion invested in Melvin’s fund, according to the Wall Street Journal.Ībout two months ago, a Reddit user called Stonksflyingup posted a video, with the title “GME Squeeze and the Demise of Melvin Capital” - with trial scenes from the miniseries “Chernobyl” superimposed with text asserting that “Melvin Capital got too greedy,” as well as an explanation of how a short squeeze can occur. These retail investors had taken aim at Melvin, a fund headed by Gabriel Plotkin, a former portfolio manager with Steve Cohen’s SAC Capital. They suspected someone was covering - well-known short sellers Jim Chanos and Andrew Left were known to be short GameStop and had tweeted about the company.īut it wasn’t either one of those men who had earned the most ire of a popular Reddit forum, WallStreetBets, whose description reads, “like 4Chan found a Bloomberg Terminal.” The effort to take down Melvin appears to have started late last year, and by mid-January, short sellers began noticing spikes in the price of GameStop. As of Friday, Melvin was down 30 percent this year, which comes to $3.75 billion of the $12.5 billion with which it started 2021, according to calculations using numbers reported in the Wall Street Journal, which first revealed that the hedge fund was getting the bailout. That’s not going to fill the entire hole.

For months, retail investors posting on a Reddit forum were broadcasting their intentions to take down a prominent, but reclusive, hedge fund called Melvin Capital - and doing so by buying call options on video game retailer GameStop, a stock in which Melvin had disclosed a big short bet.īut the effort appears to have failed, thanks to a $2.75 billion investment by Citadel and Point72 Asset Management, according to a statement from all three firms.

Next historical total war reddit