Hedge funds have lost an estimated $20 billion shorting GameStop in January.
GameStop is at the center of a battle between the little guy and the big guy. The retail investor versus the institutional investor. David versus Goliath.
As the drama continues to play out, I thought it would be prudent to include a timeline of all major events thus far.
August 28, 2020
RC Ventures LLC (led by Chewy Founder Ryan Cohen) purchases a 9% stake in GameStop. The share price begins to rise.
September 9, 2020
GameStop releases its quarterly results which show a $111.3 million quarterly loss and $277 million semi-annual loss.
October 16, 2020
Ryan Cohen writes a letter to GameStop’s Board of Directors demanding a change in direction and leadership.
January 11, 2021
GameStop appoints Ryan Cohen to the board of directors. This catches the attention of a forum on Reddit called r/wallstreetbets and members begin to buy shares.
Many members in the subreddit are inspired by u/DeepFuckingValue, a member who started investing in GameStop in June 2019 and has since posted pictures of his positions on a frequent basis.
January 21, 2021
Citron Research posts a now deleted video with five reasons for why GameStop stock will crash to $20 a share. This angers the members of r/wallstreetbets who embolden one another to keep buying shares.
January 22, 2021 – January 26, 2021
GameStop stock rises as members of r/wallstreetbets continue to buy shares.
Elon Musk, hater of short sellers, sends the stock soaring by more than 130% after this tweet.
January 25, 2021
Melvin Capital Management announces that Citadel LLC and Point72 Asset Management are investing $2.75 billion into the firm to shore up its finances.
Through the first three weeks of 2021, Melvin Capital lost 30% of its assets, around $3.75 billion, shorting stocks like GameStop.
January 28, 2021
Brokerages such as Robinhood, Webull, and E-Trade restrict users from purchasing GameStop shares citing significant market volatility. This causes the stock price to crater by more than 40%.
January 29, 2021
Brokerages lift restrictions, but place buy limits on the number of GameStop shares that can be purchased. GameStop stock rises by more than 60%.