Melvin Capital Management, one of the hedge funds pilloried on social media message boards for its short-selling bets that GameStop shares would fall, lost 53 percent on its portfolio in January, a person familiar with the matter said.
A principal reason was the huge losses the firm suffered when small investors bid up the stock of GameStop. The Wall Street Journal first reported the amount of Melvin Capital’s loss.
Founded by Gabe Plotkin, a protégé of the hedge fund billionaire and New York Mets owner Steven A. Cohen, Melvin Capital had $8 billion in assets under management at the end of January. That amount included $2.75 billion that Mr. Cohen’s fund, Point72, and Citadel, another hedge fund, put into Melvin Capital, as well as fresh capital from new investors, the person said.
Hedge fund returns at Citadel fell 3 percent for the month, about a third of which was caused by a $2 billion investment it made in Melvin about a week ago, according two people briefed on Citadel’s results.
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