Short sellers are constantly targeting GameStop shares. Here are the top three hedge funds betting against GME.
After a painful drop since their peak on November 22, GameStop GME shares have finally found their way up again, trading 13% higher in the past week. Still, as GME shareholders -- AKA the "Ape Army" -- hold on for bigger gains, some hedge funds continue to short the stock.
Read on as we count down three large hedge funds currently battling the Ape Army over GameStop shares.
#3: Hound Partners LLC
This New York-based hedge fund currently manages around $3.2 billion in assets for 13 clients.The fund has 209,100 put options on GME shares, which accounts for nearly 2% of the Hound Partners portfolio.
Since entering its GME position in the first quarter of 2021 -- right after the stock's huge rally -- the fund has liquidated 28,800 put options from its original position (237,900 put options). The hedge fund’s biggest positions are currently Vanguard S&P 500 ETF VOO and Microsoft MSFT, which account for 15% and 7% of the portfolio, respectively.
#2. Twin Tree Management LP
This fund from Dallas, Texas has $3.8 billion of assets under management and started to bet against GameStop stock as recently as Q3 of the current year.The fund has 253,700 put options on GME, at a market value of $44.5 million. This figure represents a small portion of less than 1% of Twin Tree’s assets.
Interesting to note, nearly 20% of the portfolio's AUM are placed on a bet against the SPDR S&P 500 ETF Trust via put options — although the fund also has 7% allocated to SPY calls.
#1. Prelude Capital Management LLC
Based in New York, Prelude Capital currently has nine clients and $8.1 billion in assets under management. The hedge fund has a short-selling bias, and the top three positions in its portfolio are Chesapeake Energy CHK puts (10%), SPDR S&P 500 ETF Trust SPY puts (9%), and Tesla TSLA puts (6%).
Prelude Capital has 2% of its portfolio in GameStop puts. This accounts for 469,700 put options at a market value north of $82 million. The company has liquidated 308,200 GME put options since it first opened the position in the second quarter of 2019.