GameStop shares surged nearly 75%, causing shorts to lose a lot of money. According to S3 Partners, shorting GameStop’s Hedging fund lost $838 million on the day at mark-to-market prices. The share price spike was attributed in part to internet personality Roaring Kitty, who had previously encouraged retail investors to buy GameStop stock in 2021, leading to a historic shorter squeeze. Currently, more than 24% of GameStop’s outstanding shares are shorted, and shorters have lost $1.24 billion since May. Other meme stocks such as AMC and Reddit have also seen price pumps. S3 Partners’ Ihor Dusaniwsky warned that the market is “bumpy and bloody” for shorts, with new shorts expected to enter the market at around $30.
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