RE: Short Covering before the US open27 Jan 2021 12:34
Hi MoreThanMe,
it will not be long before all the hedgefunds will need to bail each other out as their profits dry up.
Tik.. Tok.. CineWorld is going to do a PacMan job out of those outstanding Cines shorters.
[[[ Market chatter about Melvin Capital Management ]]]
Evotec, Varta shares jump again as Melvin Capital unwinds shorts
MILAN, Jan 27 - 08:36(Reuters) – Melvin Capital Management has being forced to unwind its short positions after some of its investments turned sour further boosted shares in German stocks Evotec and Varta.
A German based trader said the spike was linked to speculation on online forum Reddit about troubles at the hedge fund. Melvin is likely to have lost millions of dollars on its bearish bets on GameStop after the U.S. videogame retailer jumped seven-fold since mid January.
Shares in Evotec , a drugmaker in which the U.S. hedge fund holds a short position of 6.2%, rallied 30% in early deals, while battery maker Varta , in which it has a 4.35% bearish bet, gained 10%.
Short sellers typically bet against stocks of companies that they view as outdated in their business models or otherwise overvalued.
Both Evotec and Varta have already surged sharply on Tuesday on speculation about Melvin, which has agreed to receive a $2.75 billion investment from Citadel and Point72 in a move that is expected to help stabilise the hedge fund