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[Boston / Londres, 31 de Reuters]- There is speculation that the US stock market may continue to fluctuate this week.
Individual investors eagerly bought stocks like GameStop, which sells video games, and AMC Entertainment Holdings, a major theater chain, last week, but there are signs that individual investors will broaden their horizons even further.
Some hedge funds, which had established a large number of short sales, posted a large loss from individual purchases. Hedge fund Melvin Capital, which was at the mercy of the GameStop stock surge, posted a negative investment of 53% in January.
At the end of January, Melvin had more than $ 8 billion in assets under management. It was $ 12.5 billion at the beginning of the year.
Melvin expects GameStop’s share price, which has been sluggish, to fall. GameStop shares were trading at less than $ 5 a share five months ago.
However, the stock was up 1625% in January, closing at $ 325 last weekend, after a retail investor who saw the Reddit post launched a purchase through Robinfoot, an online brokerage firm.
Melvin closed his position in GameStop stock, raising $ 2.75 billion from the hedge fund Point 72 Asset Management and Citadel, posting a significant loss.
Investors and fund managers have speculated that some of the funds could be forced to go out of business after reports that many hedge funds have lost money. It is believed that the funds that have achieved results so far will be able to overcome this loss.
Citron Research, a US investment intelligence company that specializes in short sales, also announced on the 29th that it will not release a short sales report in the future. Andrew Left, who runs Citron, reiterated that GameStop’s business model is dead and share prices will plummet in the future.
Sanil Krishanan, director of multi-asset funds at Aviva Investors, said: “A new investor base has shown strength. It not only determines the fate of individual stocks, but also the fate of the entire large market segment, including the Index. Russell 2000. Has the power to influence “.
Goldman Sachs Group’s analysis shows that stocks bought and sold by US hedge funds last week were the highest since the financial crisis about 10 years ago, as stock prices fluctuated. The move to rewind the short position and eliminate the long position has been extended.
However, hedge funds’ exposure to equities is still nearing all-time highs and there is a risk that position-adjusted selling will continue.
Among retail investors who moved the market last week, there are signs that they are looking not only at US stocks but other markets as well.
Silver prices soared in the market last week 28-29. Silver prices have risen around 10% since SNS (exchange site) Reddit began spreading messages asking individual investors to buy silver. Gold prices have also risen.
Market players are noticing that the presence of individual investors is increasing in financial markets, where institutional investors have traditionally been the main players.
“It is an unexpected phenomenon that has been happening for months now that a large number of retail investors are beginning to change the landscape of the market,” said Paul O’Connor, director of multiple asset management at Janus Henderson.
“If you look at the data from a few months ago, you can see that the movement has started, apart from individual investors that started last week.”
