Benzinga | May 21, 2021 10:02AM EDT

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.

Read Next: GameStop Bet Nets The Church of Jesus Christ of Latter-day Saints 907% Gains In 3 Months

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