Hedge fund management firm Melvin Capital Management experienced such a drastic loss of capital last year that it has announced it will no longer pursue short-biased strategies.Melvin Capital had been betting against GameStop since 2014, motivated by the eroding fundamentals of its outdated business model. And it had been winning — by 2020, the hedge fund had made over 30% returns by betting against GME.
But due to the "meme" stock frenzy that saw investors buying shares of GameStop in a short squeeze back in January 2021, Melvin had negative returns of 39% last year.Regulatory data shows that the hedge fund lost almost $7 billion by betting against stocks like GameStop.Struggling with compounding losses, Melvin Capital has now announced that it will create a new long-only fund. Now it disclosed its13F, let's see what hapend.
Melvin Capital Management doubled down on bets that benefit from the economic reopening.Melvin Capital Management took a new stake in $Uber(UBER)$ with 7.8M common shares, according to the fund's latest 13-F filing.The hedge fund also added to its already big bets on travel-related companies $Hilton(HLT)$ and $Expedia(EXPE)$. $Bath & Body Works Inc.(BBWI)$ was another choices for getting a boost from the economic reopening
Melvin Capital Management exited $MasterCard(MA)$ from 2M shares in the previous period; $Activision Blizzard(ATVI)$ from 1M, $McDonald's(MCD)$ from 1.07M and $Block(SQ)$ from 1.30M. It also trimmed stake in $Amazon.com(AMZN)$ to 50K shares from 70K, and $Snap Inc(SNAP)$ to 3.50M from 8.50M.
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