The hedge fund Melvin Capital Management is reportedly in trouble. According to the Wall Street Journal the hedge fund has lost around 30 percent of its capital since the beginning of the year. Even with Varta shares, the short seller has probably lost a lot of money with short positions.
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DER AKTIONÄR has already reported: Shares have been hailed for days via messenger apps, online forums and platforms such as Reddit – completely regardless of their business model. If the traders then encounter a high short rate, things can happen very quickly. The short sellers have to buy stocks to limit their losses and thus accelerate the price rise.
In focus: Melvin Capital Management. The hedge fund has apparently heavily speculated on short positions in GameStop and other US stocks. In order to save the company and prevent further losses through so-called margin calls, other hedge funds have the Wall Street Journal $ 2.75 billion in fresh capital provided.
According to the Federal Gazette, Melvin Capital also held a short position at Varta amounting to just over four percent of the outstanding shares. The price increase of 26 percent since the beginning of the year is likely to have resulted in significant losses for the hedge fund. If Melvin Capital dissolves its bets on falling prices at the battery manufacturer, this could further fuel the upward movement.
There is currently no fundamental news at Varta. There is also radio silence among the analysts. Thanks to the short sellers, the chances of the recent bullish move continuing are pretty good. Investors should take into account possible dynamic changes in direction and continue to realize (partial) profits.
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(With material from dpa-AFX)
