Since entering 2021, U.S. stocks have fluctuated sharply, with U.S. stocks, bonds and Gold all falling at the same Time since the just-ended January, a very rare occurrence. Of course, the one that has received the most attention from investors, financial institutions and regulators is the short position fiasco of GameStop (GME), a US-listed video game retailer.
The Home base for this short-selling of GME, which saw the stock price rise nearly 100-fold in a year, was a U.S. stock posting, with millions of retail investors as participants and some large U.S. hedge funds as hostage to tens of billions of dollars in losses due to short-selling GME.
This multi-sided battle is often described as amateurs versus pros, and to some extent, it was, although other hedge funds were added to the mix during the matchup, allowing different professionals to appear to trade against each other.
2 hedge fund managers from New York have been buying shares of GME since last September, when the stock was trading at less than $10. They managed to rake in nearly $700 million in the historic showdown, making it one of the market’s legendary wealth creation stories in January, when the fund returned 38.4 percent after fees.
As the short-selling war in U.S. stocks around GME and other stocks draws to a close, some of the late high-flying retail investors have lost their money. Overall, who is better, retail investors or funds, varies depending on the individual and the fund, and cannot be overshadowed.
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