Not Just GameStop, WallStreetBets' Target Melvin Capital Closed All Public Bearish Positions In Q1

Hedge fund Melvin Capital Management LP, which was at the heart of the GameStop Corp. (NYSE: GME) short squeeze frenzy earlier this year, closed out of all its public bearish positions in the first quarter.

What Happened: Melvin Capital exited all of its listed put options during the first quarter, according to a filing with the Securities and Exchange Commission.

These include such positions in GameStop and New York-based entertainment company AMC Networks Inc. (NASDAQ: AMCX), not to be confused with a similarly-named movie theater chain that was a short squeeze target earlier this year.

The company also closed its put options in several other companies including Viatris Inc. (NASDAQ: VTRS), Invesco Solar ETF (NYSE: TAN) and Cryoport Inc. (NASDAQ: CYRX), during the quarter.

Melvin had acknowledged in late January that it closed out of its GameStop short position.

See Also: Are GameStop, AMC On The Verge Of Another Short Squeeze?

Why It Matters: Amateur traders belonging to the Reddit Investor forum r/WallStreetBets bid up heavily shorted stocks such as GameStop and Kansas-based movie theater chain AMC Entertainment Inc. (NYSE: AMC) to create a short squeeze earlier this year. This forced bearish investors, including Melvin Capital and other hedge funds, to unwind their bets against the stocks, sparking a rally in January.

It was reported at the time that Melvin Capital lost 53% on its investments in January. The company ended the month with more than $8 billion in assets under management, after starting the year with roughly $12.5 billion.

Losses at Melvin Capital got so bad that the hedge fund received $2.75 billion in investments from hedge funds Citadel LLC and Cohen’s Point72 Asset Management.

Retail investors are continuing to put short sellers in losses, which are estimated to have lost almost $930 million recently over five trading days following the latest surge in GameStop and AMC Entertainment, according to data from analytics firm Ortex.

See also: How‌ ‌to‌ ‌Buy‌ ‌GameStop‌ ‌(GME)‌ ‌Stock‌

Price Action: GameStop shares closed 6.6% lower in Wednesday’s trading session at $168.83 and further declined almost 0.5% in the after-hours session to $168.00.

AMC Entertainment shares closed 9.9% lower in the regular trading session at $12.64 and further declined 1.1% in the after-hours session to $12.50.

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