Tag: Melvin Capital (Page 1 of 3)

Tiger Global Parts Ways with Partner Who Caused Massive Losses

Tiger Global Sam Harland
Market News: Tiger Global parts ways with Sam Harland

Tiger Global just parted ways with Sam Harland, the partner responsible for sinking the hedge fund when it betted on Carvana.

The hedge fund suffered 52% in losses this year through May.

Their average cost basis is $105.80, more than five times the $24.27 level the stock closed on Friday.

Both Harland and Tiger Global Management declined to comment on his departure according to Bloomberg.

Here’s the latest market news.

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Hedge funds struggle to stay afloat

Hedge funds seem to be stranded on a sinking ship as losses accumulate this year.

One hedge fund who betted against GameStop is closing this month.

Last year many hedge funds were forced to cut their losses and throw in the towel on losing bets.

Tiger Global Management closed 2021 with a 7% loss.

They reported a 52% loss this year through May.

Tiger Management Losses
Tiger Global Management losses (blue) | Tiger Global Management News

The hedge fund may be on track for its worst year yet.

Earlier this year we saw Citadel and other hedge funds faced default on Russian bonds from tech company Yandex.

Investors tried pulling out $250 million from Coatue Management but the hedge fund couldn’t meet investors demands.

Aside from the shorting of ‘meme stocks’, hedge funds are also getting burned from tech stocks falling.

The NASDAQ has fallen nearly -32% this year-to-date taking down every major tech company down with it.

Amazon (AMZN) is down more than -37% this year, Tesla (TSLA) -45%, and Apple (AAPL ) -27.72%.

Carvana is down nearly -90%, one of the heaviest held assets by Tiger Global Management.

Tiger Cubs ditch positions

The Tiger Cubs alliance consists of Tiger Global Management, Lone Pine Capital, Coatue Management, Maverick Capital, Viking Global Investors and D1 Capital.

According to Bloomberg, majority of the Tiger Cubs stock picks are in tech stocks.

Tiger Global exited 83 positions depicted in the chart below and entered only 2 new positions.

Tiger Cubs ditch positions
Tiger Cubs ditch positions

The Tiger Cubs have been known for piling into the same or similar stocks primarily because they all had the same mentor.

Below is a list of only some tech companies the Tiger Cubs have recently reduced from their positions.

Big name companies include Carvana, DoorDash, Netflix, and Shopify to name a few.

Tiger Cubs Losses
Tiger Cubs Losses | Tiger Global Management News

These companies might have been extremely convenient during the pandemic lockdowns, but the truth is people are going out now.

Now that gyms are open to the public, people have no need for Peloton.

Netflix couldn’t replace the movie theatres, and so on.

Some experiences are simply irreplaceable.

And it’s showing in tech company stock.

I’d love to hear your thoughts on the matter.

Join the discussion in the comment section of the blog down below.

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Hedge Fund Tiger Global on Brink of Shutting Down?

Hedge fund Tiger Global
Market News: Hedge Fund Tiger Global down more than 50% this year.

Hedge fund Tiger Global is on the brink of collapsing.

WSJ reports the hedge fund is lost 52% for the year up to May.

It was down 34% this year through March but the institution keeps sinking.

Melvin Capital threw in the towel after suffering several losses this year.

Is hedge fund Tiger Global the next one to go?

Let’s discuss it.

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Hedge fund empires crumble

Melvin Capital lost a staggering 20.6% the first quarter this year alone.

In 2021, they took a heavier hit with 50% in losses.

Now Gabe Plotkin’s Melvin Capital is shutting down end of June.

The Tiger Cubs, an alliance consisting of hedge fund Tiger Global Management, Lone Pine Capital, Coatue Management, Maverick Capital, Viking Global Investors and D1 Capital are facing massive losses this year too.

According to Bloomberg, majority of the Tiger Cubs stock picks are in tech stocks.

Which as we know, have been plummeting all year.

Tiger Global exited 83 positions depicted in the chart below and entered only 2 new positions.

Coatue Management is another hedge fund who has been struggling to keep its doors open this year.

Last year investors demanded to pull out $250 million from the hedge fund but Coatue was unable to meet demands.

Coatue said the money they could not deliver to their clients was being held in private companies, making it difficult to liquidate.

Today we see Coatue Management exited 35 stocks and only entered 12 so far.

The rest of the cubs aren’t doing so well with everyone exiting more positions than entering them.

Hence the reason why we’ve seen the market fall all year.

Will hedge fund Tiger Global close?

Tiger Global Hedge Fund

Although the hedge fund has wiped out more than $16 billion in assets under management, Tiger Global continues to hold on.

“We take very seriously that our recent performance does not live up to the standards we have set for ourselves over the last 21 years and that you rightfully expect. Our team remains maximally motivated to earn back recent losses,” the hedge fund wrote.

But even then, the hedge fund has struggled to find a winning strategy.

Tiger Global was down more than 34% the first quarter of 2022.

And instead of finding a solution, the hedge fund sank to a total of 52% halfway through Q2.

Things aren’t looking so good for the hedge fund.

What do you think?

Will hedge fund Tiger Global be the next institution to fall?

Leave your thoughts in the comment section of the blog down below.

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Related: Ken Griffin Attacks: "Pension Plans Destroyed by Retail Investors"

The Tiger Cubs Are on The Brink of Collapsing

Tiger Cubs Hedge Fund
Market News: Tiger Cubs face disturbing losses as tech stocks fall

(Bloomberg) Hedge fund managers known as Tiger Cubs are facing serious carnage in the market.

The alliance consists of Tiger Global Management, Lone Pine Capital, Coatue Management, Maverick Capital, Viking Global Investors and D1 Capital 

Billions were made in tech stocks, but gains have now evaporated.

Tech stocks have fallen the first quarter of 2022 and have bled into the second quarter this year.

Is it possible the Tiger Cubs are the next hedge fund managers to join Melvin Capital’s grand exit?

Let’s discuss it.

franknez.com

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NASDAQ plummets in 2022

The tech-heavy NASDAQ 100 has fallen more than 29% this year.

It’s down more than 11% from the S&P 500 (down 18.47% YTD).

According to Bloomberg, majority of the Tiger Cubs stock picks are in tech stocks.

Tiger Global exited 83 positions depicted in the chart below and entered only 2 new positions.

The hedge fund sank 34% the first quarter of 2022.

Tiger Cubs positions

Coatue Management is another hedge fund who has been struggling to keep its doors open this year.

Last year investors demanded to pull out $250 million from the hedge fund but Coatue was unable to meet demands.

Coatue said the money they could not deliver to their clients was being held in private companies, making it difficult to liquidate.

Today we see Coatue Management exited 35 stocks and only entered 12 so far.

The rest of the cubs aren’t doing so well with everyone exiting more positions than entering them.

Tiger Cubs cut their losses

Below you’ll find a chart showing the worst-performing stocks widely held by the Tiger Cubs.

Big name companies include Carvana, DoorDash, Netflix, and Shopify to name a few.

Tiger Cubs Losses
Source – Bloomberg

The Tiger Cubs have been known for piling into the same or similar stocks since they all had the same mentor.

These hedge funds are facing significant losses despite being in it together.

Melvin Capital saw a 50% loss in 2021 and another 20.6% during the first quarter of 2022 before throwing in the towel.

The hedge fund was destroyed by retail investors when it decided to bet against game retailer GameStop and other ‘meme stocks’.

Ken Griffin defended Gabe Plotkin’s Melvin Capital in a Bloomberg exclusive attacking retail investors.

The Citadel founders said retail investors wiped out teacher’s pension plans by bankrupting Melvin Capital.

And the retail community is biting back, speaking the truth.

CALPERS, the largest pension fund in America loaded up on AMC and GameStop and sold Netflix, though.

Ray Dalio’s Bridgewater sold Tesla this Q1 and bought AMC stock for the first time and increased their stake in GameStop.

These are two examples where conventional wisdom doesn’t always make sense (i.e., investing in fundamental tech stocks).

And we can see hedge funds who do follow this ‘conventional wisdom’ are suffering because of it.

Which hedge fund will be next to fall?

Some of you said on Twitter Tiger Global could be the next hedge fund to fall.

Coatue Management has been in deep waters too.

I’m curious to know what you think about where hedge funds are currently headed.

Leave your thoughts in the comment section of the blog below.

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Related: Ken Griffin Attacks: "Pension Plans Destroyed by Retail Investors"

Ken Griffin Attacks: “Pension Plans Destroyed by Retail Investors”

Ken Griffin on Retail Investors
Market News: Ken Griffin on retail investors

Ken Griffin accused the retail community of destroying teacher’s pension plans by taking down Gabe Plotkin’s Melvin Capital.

Melvin Capital is a hedge fund that was short on ‘meme stocks’ holding a large position in GameStop.

The company is scheduled to shut down in June after it had suffered a 50% loss in 2021, and an additional 20.6% in the first quarter of 2022.

Sources say Melvin Capital has already begun to liquidate its positions to pay back investors in cash.

In this Bloomberg exclusive, Ken Griffin plays a role of the victim, defending Mr. Plotkin and the hedge fund whose mission it was to bankrupt GameStop.

Ken Griffin’s Citadel is also short on AMC Entertainment – the hedge fund lost billions last year betting against retail.

Let’s discuss it.

franknez.com

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CNBC mourns the loss of Melvin Capital

CNBC says Melvin was one of the biggest victims from the meme stock frenzy last year due to its large short position in GameStop.

They say Citadel and Point72 had to provide Melvin Capital with a lifeline to stay above the water.

The hedge funds combined provided Gabe Plotkin with $2.75 billion in capital last year.

However, as things went south quick for Melvin, both hedge funds demanded the capital back.

Something Ken Griffin and his affiliates fail to mention.

Mainstream media has also danced around the fact that hedge funds planned to wipe American companies by overleveraging their short positions during the pandemic.

Success in doing so would delist AMC, GameStop, and other meme stocks from the stock market.

Betting against companies with intention to bankrupt them to the ground is no charity work.

It’s un-American and a nefarious practice that has dragged out for too long.

Ken Griffin blames retail investors

In the video below, Ken Griffin gives his thoughts on retail investors and the entire ‘meme stock’ phenomena.

https://twitter.com/PKPlayerOne/status/1527323628291117056

Ken Griffin takes a jab at the retail community saying retail investors who aimed to bankrupt Melvin Capital also wiped-out pension funds from teachers.

But Ken, retail investors don’t get up in the morning and think to themselves, “let’s wipe out a multi-billion-dollar hedge fund.”

Melvin Capital lost because he went against retail – the first time in history the people fight back corruption in the stock market, and win.

Ken Griffin lost billions shorting AMC stock, the retail community is currently his biggest adversary.

AMC shareholders continue to buy and hold the stock until short sellers exit their positions, which will result in a short squeeze.

Today’s retail investors are armed with education, they understand what they hold and what it’s doing to hedge funds.

While Ken Griffin and affiliates might be pumping a narrative as victims, high profiles such as Elon Musk, Jon Stewart, and Ryan Cohen have stood up against short sellers.

For the first time in history, Wall Street is getting their a** kicked, and these hedge fund managers certainly do not like that.

Hedge funds should prepare for bigger losses

Institutions are about to lose a massive amount of collateral due to executive order 14032 in early June.

This presidential order is prohibiting Chinese securities to be used as collateral starting June 2nd, 2022.

It was responsible for initiating margin calls when AMC Entertainment stock rose to $20 per share in January, and $72 per share in June of last year.

With liquidity drying up in global markets, it’s going to be quite difficult for hedge funds to keep up with margin requirements on heavily shorted ‘meme stocks’.

Massive selloffs in the market have proved just how distressed financial institutions are.

We’re seeing for the first-time hedge funds begin to shut down as they take the lead in liquidity burn.

Retail investors have been the majority of buyers in today’s markets according to Bank of America.

Hedge funds are headed towards a larger train-wreck of disaster they cannot get off of.

As they continue to tank the markets, margin requirements go up thanks to DTCC B16845-22.

Hedge funds have lost control.

But I’m curious to know what you think.

Leave your thoughts in the comment section of the blog below.

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Hedge Fund Melvin Capital Is Shutting Down End of June

Stock Market News - A City Councilor Is Now Sentenced 6 Years Prison For Stock Manipulation
GameStop short seller Melvin Capital is closing its doors this summer

Hedge fund Melvin Capital, notoriously known by the retail community for betting against GameStop is now closing its doors.

2022 marks the second year in a row the short seller underperforms.

Melvin Capital lost a staggering 20.6% the first quarter this year alone.

In 2021, they took a heavier hit with 50% in losses.

Now the hedge fund tells CNBC they will be shutting down by the end of June and starting a new company.

Let’s dive deeper.

franknez.com

Welcome to Franknez.com – if you haven’t joined the newsletter, be sure to do that below. I’m publishing market news and updates daily.

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The apes were right

In March, I published a tweet asking the community whether Melvin Capital would be the next hedge fund to default.

We all saw this coming, but 90% of you voted YES.

Forward a month later and now the hedge fund is announcing it is closing this summer.

Earlier in March we saw another notorious hedge fund known for shorting GameStop pull $2 billion from Gabe Plotkin’s Melvin Capital.

That hedge fund was Citadel.

Citadel also lost billions last year shorting so called ‘meme stocks’, so it comes as no surprise as to why they pulled out from Gabe Plotkin’s Melvin Capital.

Ken Griffin’s Citadel also imposed tight restrictions on its clients leading into the new year.

Customers were given an ultimatum to either stay with the firm otherwise coming back would prove to be difficult.

Steve Cohen’s Point72 redeemed $750 million from Melvin Capital around the same time.

Ken Griffin received a $1.2 billion lifeline from partners Sequoia and Paradigm in January of this year.

This was the first time Citadel had ever received private funding.

Don’t bet against the apes

Mainstream media doesn’t give retail investors enough credit for shedding light on market injustices.

The ‘ape’ community has grown since last year as retail investors discover the short interest data that points towards a bigger AMC runup than that of January and May of last year.

In this video I go over patterns that are similar to those from last year’s runup and what we should keep a close eye out on.

The apes were right about naked shorting, dark pools, and the dangers of betting against retail.

Now hedge funds are dealing with the consequences of betting against the people.

Majority of the community continues to buy and hold ‘meme stocks’ such as AMC and GameStop in efforts to create a massive short squeeze.

Retail has said it many times, a short squeeze is inevitable.

While the SEC might be proposing rules that could wash naked short selling, yet avoid them in the future, it would take years to enforce if passed.

Will hedge funds survive?

Hedge funds are currently facing deep scrutiny from both retail investors and regulators.

The DOJ is taking Morgan Stanley, Goldman Sachs, and numerous other hedge funds to court.

Citadel is one of the short sellers currently being investigated by the Department of Justice according to a Bloomberg report.

The SEC and DOJ are looking into the following:

  • Communication between banks and hedge funds
  • Proof of ‘Bear Raids’
  • Spoofing
  • And several other market manipulation tactics

Hedge fund Muddy Waters was already raided by the FBI earlier this year for flooding the market with fake orders to drive stock prices down.

Melvin Capital is only one of many hedge funds that has closed down in the past year due to overleveraged short selling, and bad bets.

What are your thoughts on the Melvin Capital news?

Did you see it coming?

Leave a comment below.

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