Hedge fund made $700 million on GameStop (pro-tip: this is what HFs are supposed to do)

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Hedge fund made $700 million on GameStop (pro-tip: this is what HFs are supposed to do)

Senvest Management began buying stock in GME in September 2020, not getting caught up in the short-selling mania in the company.

Their work included:

  • speaking with management
  • assessed competitors 
  • noted the involvement of activists in the stock
  • By the end of October, Senvest owned more than 5% of the company, paying under $10 a share for the bulk of the stock.
  • They thought that if GameStop could hold on until the next generation of videogame consoles came out and stoked demand for games and accessories, the company would get a boost. And they reasoned that if Mr. Cohen could help transform GameStop from a largely bricks-and-mortar operation into an online gaming destination, the company could be worth far more.


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